The Territorial Hospital Board began talking about finding ways for the two hospitals – Schneider Regional Medical Center on St. Thomas, and Gov. Juan F. Luis Memorial Hospital on St. Croix – can save money and provide better service by sharing resources, possibly personnel, and perhaps even administrative officers.
The discussion took place Saturday at the board’s quarterly meeting. The meeting had been scheduled to take place on St. John, but had to be rescheduled due to weather that made travel difficult. It was held instead in the SRMC board room.
Also at the meeting, the territorial board approved the nomination of SRMC Chief Operations Officer Angela Rennalls-Atkinson to serve as interim chief executive officer starting Jan. 1. She will step in for outgoing CEO Alice Taylor, who submitted her resignation in October.
The two hospitals have already been discussing money-saving joint moves.
A report from Jeff Nelson, CEO of the hospital on St. Croix, noted the two hospitals "continue to work together on implementing a joint group purchasing program. An outline of the opportunities for the two hospitals to work together was presented to the chairperson of the SRMC earlier in the month."
Larger group purchasing can save the institutions money on both supplies and pharmaceuticals through bulk purchasing, he said.
However, Lynn Millin-Maduro, chairperson of the territorial board, encouraged board members to think more broadly. She wants a subcommittee of the board to look at staffing, look at where the hospitals overlap services and where there are holes, and how the two institutions can work more closely together.
One possible solution could include recommending changes in the way the two institutions are administered. Under the Virgin Islands Code, the territory’s health care institutions are divided into two districts –St. Croix and St. Thomas/St. John, each with its own hospital, and each with a board and administrators.
It may be time to ask, Millin-Maduro said, whether that arrangement still serves the best interest of the territory.
"We have to look to see if that still makes sense, if that’s still a good idea," she said.
Kye Walker, chairwoman of the JFL board, said in an exit interview with auditors Friday, that the visiting officials had suggested the hospital was overstaffed, and specifically questioned why each hospital needed its own district board, overseen by yet another body – the territorial hospital board.
She pointed out that the auditors did not understand that the system was codified in the Virgin Islands Code and would require a major overhaul by the legislature to change it. Nelson said the comparison is to hospitals from more populous areas with higher populations from which to draw patients. JFL averages more than five full-time equivalent – or FTE – employees, while the national average is about 3.7, and JFL, at times, goes as high as 8 FTEs.
While the board did not take official action to form such a committee Saturday, several members voiced interest in serving.
During a break in the meeting Millin-Maduro spoke further on the concept, pointing out that the world is a very different place than it was when the system was set up decades ago.
"It’s two districts separated by, what, a 20-minute flight?" she said. Instantaneous communication and computer networks bind the institutions even closer together.
She said she wants the discussion to be completed by the end of the fiscal year, September 2012.
"We need to start the new fiscal year with some concrete measures in place," she said.
Any more far-reaching recommendations could be passed on to the new legislature in January 2013.
In approving the nomination of Rennalls-Atkinson to interim CEO of Schneider, the territorial board accepted the recommendation of SRMC’s board.
SRMC Chairman Cornel Williams said the hospital will soon form a search committee dedicated to finding a permanent CEO. He added that the firm that led the search that resulted in Taylor’s hiring 18 months ago had a two-year-guarantee in the contract, so the new search will not cost the hospital much.
After a brief executive session, the board also approved an annual salary for Rennalls-Atkinson of $225,000.
Rennalls-Atkinson started working for SRMC in 2003 as vice president of nursing and patient care services. Prior to that, she had held leadership positions at Bronx-Lebanon Hospital in New York. She has a bachelor’s degree in nursing from City College of New York, a master’s degree in community health Long Island University, and a master’s in business administration in management from Long Island University.
In 2007, SRMC promoted Rennalls-Atkinson to the position of chief operations officer. Since January, she has also been chief nursing officer.
The need for cost-cutting measures, such as those urged by Millin-Maduro, was brought home by the administrator reports of Nelson from JFL and the outgoing SRMC CEO Taylor.
Even with the Senate last week overriding the governor’s veto and passing a measure relieving the two hospitals of some $80 million in debt owed to the government, the hospital’s are still in the red.
Nelson said the forgiveness on JFL’s $50 million debt to the government still leaves the hospital in $28 million in debt to various vendors. While the flow of red ink has been stemmed by a series of system improvements, cost-cutting moves and attempts to increase revenue, JFL is not at the moment in position to begin paying back what it owes.
Similarly, SRMC’s budget projected a loss for the current fiscal year, which began Oct. 1, of about $5 million. But that figure was arrived at before the Office of Management and Budget called for all departments to reduce their projected revenues, creating an additional $2.5 million deficit.
Both hospitals also face significant capital improvement projects without the capital to pay for them, meaning old equipment will get older and outdated facilities will have to last a little longer.
