ETMC stands on record in effort to stay in race for hospital lease
Houston County Courier
By Lynda Jones Editor-in-Chief East Texas Medical Center (ETMC) stood on its record of service as Vice President Mike Thomas told the Houston County Hospital District Board of Directors Tuesday, Feb. 26, "ETMC would like to continue to be your partner. We think we're the best choice for that." Thomas prefaced his 15-minute powerpoint presentation by saying, "I was here in 1994 when you all were going through the same kind of process and did a presentation, and you began to look for a strategic partner in '94, and you reviewed proposals from numerous hospitals, and you chose ETMC to be your partner, and after several months of negotiation, on May 5 of '95, we signed a comprehensive 20-year agreement." Thomas said that in preparation for Tuesday's presentation, he reviewed that agreement. He said it was a 45-page agreement that included over 150 specific line items that ETMC had to meet. "I think you guys probably did a better due diligence of any place we've ever gone because you were very specific and held our feet to the fire as to what you expected, and how healthcare would be delivered in this county and how you think it should be. I think it also created a true strategic partnership and we've done some great things together," Thomas said. Thomas summarized what he described as the main areas that the lease required: •Maintain a financially viable, operationally strong hospital organization in full compliance with all relevant state and federal regulations. •Significant investment of capital through an inflation adjusted rent, assumption of HCHD bond indebtedness, construction of an ambulatory diagnostic center and medical office building, initial upgrades in equipment, machinery and fixtures in the existing hospital and ongoing upgrades as required. •Assumption of a majority of HCHD's state mandated indigent care responsibilities. •Maintain a comprehensive mix of market appropriate health services in the county. "We have successfully met all of those criteria or exceeded, and I think we've shown that we do what we say we're going to do," Thomas said. In regards to maintaining an operationally strong hospital, Thomas quoted some statistics he feels are important. "There's all kinds of services and you get all kinds of different statistics, but I just aggregated all interactions with patients by the facilities here, and they're up 133% since 1995 in all areas," Thomas explained. He said he feels it is important to note that Houston County residents seeking in-patient care outside the county is down 10.8% since 2000. "One I think is very interesting and very important to this community is that residents of counties that are outside of Houston County, that are seeking care from ETMC Crockett facility, is up 266% since 2000," Thomas said. Emergency visits from residents outside the county are up 181%, in-patient stays from those people are up 160% and out-patient visits are up 422% according to Thomas. Thomas said the increases are "a tremendous economic benefit to Houston County and really made possible by some of our integrated systems services and moving patients from Trinity to here and other activities that we've had." He said further, "We assumed the indigent care responsibilities for the county, some of which belonged to the Houston County Hospital District, but they have to met in some way, shape or form. Since '95 we've provided $38.4 million in indigent care and $46 million in uncompensated care, and as you all know, the definition of who is an indigent fluctuates but all of our uncompensated care is people who cannot afford to pay for their care." Thomas said he feels an advantage of the strategic partnership between ETMC and the HCHD as he described it, is that the hospital district was not responsible for indigent health care or operational hospital expenses, allowing the hospital district to direct its resources into other activities and reducing the overall tax burden of the citizens of the HCHD. He said another advantage of the partnership is that the HCHD partnered with ETMC in numerous capital investments and improved the quality of health care for residents. Since 1995, ETMC has invested $31 million in capital improvements, Thomas said, adding that the HCHD was in need of capital infusion when ETMC came into the picture. He said the list of capital improvements included more than 100 line items. He noted the ambulatory care system, the medical office building, patient room remodeling, the college education center, birthing center were highlights that contributed to the development of ETMC Crockett as a state-of-the art facility. "We were required to make a comprehensive mix of market appropriate services, which we believe that we've done," Thomas said. "This is a full service community hospital and has been for the entire time, and in addition to this, we have provided Houston County residents with emergency medical transportation through our EMS and Air One transport, with no city or county subsidy that we get from many other communities that we're in, and this is despite a $200,000 annual loss. Thomas also commented on the uncertainty of the future of healthcare in the United States. "We've been actively involved in trying to develop a forward thinking strategic plan . . .what things we need to focus on in the future . . . quality of care. . . . Cost transformation is critical. Reimbursements are declining dramatically and we're going to have to figure out how to deliver the same level of service at lower and lower costs. "We still stay mission-driven on maintaining access to the people of East Texas to healthcare. There's so much emphasis now on centralization. We're going to continue our mission to keep things close to home," Thomas said. He also said ETMC wants to expand services and get into managing health populations. "We think we would be a good partner going forward because we have proven that we can deliver a stable and dynamic and financially viable hospital. . . . We believe we've provided this community the only period of time in which you've had a stable and viable hospital," he said. "We have been doing these kinds of relationships, these kinds of partnerships, in communities all across East Texas since the early '80s. They've all been successful. We've done what we said we were going to do. We are the dominant health provider in this region. . . . We have shown our ability to compete, which is important to any community hospital. . . . We, over the years, specific to East Texas in healthcare management, we've proven our expertise in how to make small hospitals succeed."