Taking one step in a three-year multimillion-dollar electronic records upgrade, Schneider Regional Medical Center’s governing board voted Wednesday to spend $168,000 of hospital operating revenues for software while it seeks out federal grant funding to pay the full cost of the federally-mandated work.
The $168k expenditure is just a tiny portion of what the hospital will ultimately need to pay; more than 90 percent of that sum will be used to purchase software modules for hospital quality and risk management and patient care and safety.
The Centers for Medicare and Medicaid Services, which certifies the hospital and determines if it is reimbursed for Medicare and Medicaid care it provides, is mandating hospitals nationwide upgrade their computer health record systems, explained Board Chairman Cornel Williams at the board’s regular meeting Wednesday evening.
A team from OmniSystems, the hospital’s IT consultants, outlined the scope of the overhaul during the meeting, saying $1.7 million will need to be spent by 2014 to meet CMS benchmarks requiring hospitals achieve "meaningful use" of enhanced, coordinated record keeping.
Computer hardware consumes about a million dollars of that total, with software accounting for the rest, according to Terence Thomas, technical director at OmniSystems. The $1.7 million price tag is just to meet CMS requirements for achieving meaningful use, he said. To overhaul the hospital’s entire network will cost another $4.8 million or so, according to figures provided by Thomas.
A $700,000 U.S. Interior Department grant is paying for some of the work right now. The hospital hopes to get more grant funding, but cannot count on getting it, Schneider Chief Executive Officer Alice Taylor said. With tight cash constraints and budget cuts this year, the hospital anticipates a budget deficit of over $4 million next year, Taylor said.
Paying for the work will be "a juggling act," but "to be honest with you, I don’t think we have a choice," she said. If it is not done in time, CMS will start reducing reimbursements in 2015, and if it is not done by 2021, CMS will stop reimbursements, Taylor said. Even if the hospital absorbs the cost through its operating revenues at first, it ultimately needs to find a way to recoup the cost, she said.
"I think we are really banking on some support, some grant funding to at least pay ourselves back," or possibly some funding from a coordinated territorial grant proposal, Taylor said.
In other business, Board Chairman Cornel Williams reported the board has found a "viable interim CEO candidate" to replace Taylor. Taylor submitted her resignation in October, but has said she will continue to work while an interim replacement is found.
The candidate, who Williams declined to name, will be presented to the Territorial Board of the Virgin Islands Hospital and Health Facilities Corporation, the joint board of Gov. Juan F. Luis and Schneider hospitals, at its regular meeting this Saturday on St. John.
The board also approved a set of increases to hospital room rates aimed at bringing charges more in line with those found elsewhere in the nation. Details of the new rates will be made public in the next day or two, but Taylor and Williams asked the board not to release the rate tables they distributed among themselves because they contained information on the specific discounts various insurers have negotiated with the hospital.
Board members present were: Williams, Maria Tankenson–Hodge, Judith Richardson, Vincent Samuel, Greta Hart-Hyndman, Aldria Wade, and Miles Stair.
