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Bitter pill to swallow
Olympic Medical Center’s Board of Commissioners is spending $8.4 million to expand and improve Olympic Memorial Hospital’s emergency department.
First, the good news: The expansion will result in better, faster service for the hospital’s growing number of emergency patients.
And now the bad: With district revenues in decline, the expansion will make the district’s difficult financial situation just that much harder.
Borrowing and spending
At their mid-June meeting, board members voted to borrow $10 million to cover the cost of the expansion. This week they took the first step in spending those dollars by approving a $744,000 contract to pay for the architectural and engineering design work that will be required. The board awarded the contract to Scherer Associates, an Olympia-based planning and design firm that specializes in hospitals.
Lorraine Wall, chief nursing officer for OMC, said the staff has developed “a good, solid plan” for the expansion. She also described the current emergency department as “woefully undersized.”
“Rarely does a day go by that we don’t use our hallway beds,” she said.
To make room for the expansion, the annex west of the hospital will be removed. It currently houses OMC’s human resources department, a portion of the finance department and the payroll staff.
Finding a way
The board members unanimously agree the expansion is necessary. They also agree that in OMC’s current financial straits, it’s money they can ill afford to spend.
Board member John Nutter, a former finance director for the center and a current member of the board’s budget committee, said, “I really don’t like spending money on something that won’t produce revenues but it’s a core service of what we do.”
He pointed out the current emergency department was built to accommodate 25 to 30 patients a day, but is now dealing with an average of 75.
“It’s almost become a quality of care issue,” he said.
Board member Jim Leskinovitch noted that government sources of funding — which constitute the hospital’s primary source of revenue — are continuing to decline.
“I’m really uncertain about approving this, but we have no choice,” he said.
By law, all emergency rooms must provide medical services to all who request such services, whether they can pay or not. That means many of the uninsured and underinsured members of the American public now utilize emergency rooms as their sole source of medical care.
Five percent of the care provided by OMC is uncompensated and that figure is growing.
Nutter pointed out that new rules have been proposed that would reduce the number of emergency room visits funded through Medicaid to three a year. “The payments would stop,” he said, “but the visits wouldn’t.”
For the defense
Scott Kennedy, OMC’s chief medical officer, said, “We’ve already outgrown our capacity.” He said despite the fiscal pain, it’s necessary to “catch up with where we are ... and plan for growth.”
Nutter said the $10 million loan will be paid out of the hospital’s operating budget.
He noted that four years ago the board went to voters asking for additional funding and said it’s probably too early to ask again. “The community expects us to live within our means,” he said.
Reach Mark Couhig at firstname.lastname@example.org.