By CRISTINA JANNEY
Hays Post
The HaysMed CEO and director of nursing responded to criticisms from current and former employees on Thursday, explaining the hospital has restructured to deal with financial challenges.
HaysMed had an annual loss of $5.6 million as of June 2023, according to a report on the American Hospital Directory. CEO Edward Herrman would not release any further information about the financial status of the hospital except to say the hospital is facing financial challenges.
The hospital said it does not distribute an annual report.
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Herrman said in an interview on Thursday the hospital has used funds from investments and cash reserves to deal with some of the hospital's financial issues over the last 18 months.
Hospital employees told the Hays Post that staff had been cut from departments.
Herrman said the hospital did not have staff reductions. He said the resources were reorganized, but staff members were given the opportunity to apply for other vacancies within the hospital.
Employees expressed concerns about hours being cut.
The hospital said in an email Friday, "When we looked at departmental efficiencies, some areas did reduce hours. All impacted associates were offered the opportunity to offset those hours in other areas.
"Staff received orientation and training if transitioning to a new or unfamiliar area, which is the customary practice for new employees to our organization. We have many staff that are cross trained for different departments in the hospital. This is especially common with nursing departments."
Hospital departments and clinics were also asked to see more patients in less time, cutting the time allotted for clinic visits from 30 minutes to 15 minutes. Staff members expressed concerns about how the changes were affecting patient care.
"We're always trying to make sure that we are being as efficient as possible and maximizing access for patients," Herrman said, "the ability to get patients in [to be seen] in a timely fashion in the clinics or in for anything like X-rays, MRI or CT."
Later in the interview, he added, "Quality care of the patients is the No. 1 thing that we do. Do we look for efficiencies so we can see as many patients as possible so we can increase access for people in western Kansas? You bet. We absolutely do.
"But because every patient has a different need, are there times they can see a patient quicker, and when you see a new patient, they are scheduled to be in there longer? We vary based on the types of patients they are caring for."
Staff members interviewed by Hays Post said the extra time needed to account for patients who needed longer appointments was not figured into the schedule, which resulted in long wait times for some patients.
Herrman said the hospital looks at national standards to help establish guidelines for the average number of visits a department or clinic should be able to see. He said the hospital tries to stay at the median of those national averages.
HaysMed partners with clinics in other communities in western Kansas. Herrman said that although none of those partnerships have been dissolved, HaysMed staff has been busy enough in Hays that they have had to cut back on clinic time outside of the local hospital.
Some hospital staff members expressed concerns about the use of traveling nurses and locum tenens, which are temporary medical staff.
Terry Siek, director of nursing and vice president of patient care, said agency nurses are not used in place of native staff members but are used when the hospital has an opening that is not being filled.
He said about 10 percent of HaysMed's nursing workforce are agency nurses.
According to HaysMed, the current national average of registered nurse turnover in hospitals is 15%. HaysMed’s registered nurse turnover rate is 10.6%, which places HaysMed in the top 10% of all hospitals nationwide with low turnover.
Hays Post asked for HaysMed's patient-to-nurse ratios. Siek said the ratios are based on national standards and the patient's acuity.
"We strive to hit those national standards," he said. "At times, very infrequently, we may not hit that national standard."
Herrman said the hospital has been working to meet all quality metrics on Blue Cross Blue Shield scorecards to maximize its reimbursement.
He said the hospital has also sought to decrease the cost of goods used in the hospital by millions of dollars.
Some staff members have complained about pay on social media and in interviews with the Hays Post.
The hospital's current and former leadership earned more than $2 million in 2022, according to its 990 forms filed with the IRS. Herrman earned $726,311 in 2022, according to the 990 form.
The Hays Post asked if the hospital leadership had received any pay raises or bonuses since the pandemic, considering the hospital's recent financial struggles.
Herrman said he would not discuss individual compensation.
"The board actually determines the compensation for myself," Herrman said. "The board reviews those leadership roles. They are compared to national standards, national benchmarks and averages, and that is how those things are determined."
Herrman also addressed HaysMed use of noncompete clauses in its contracts, noting that he also has a noncompete clause in his own contract.
"It's a very standard practice within health care," he said.
Multiple providers have recently left the hospital and taken their practices out of state. Some of these include. Dr. Wallace Michael Curry, OBGYNs Drs. Lee Hodny and Joel Fort, and Dr. Anthony Acursso, oncologist.
Herrman added, "When someone first comes on, they are typically not embedded in the area, so you are spending the first couple of years just trying to build their practice for them if they are provider or an advance practice provider."
He said a hospital opens doors for those providers.
He said providers also may have intimate knowledge of the hospital's business strategies.
"That's part of the noncompete, which is to protect that strategic knowledge that an individual gains through their employment," he said.
Herrman said the landscape of health care has changed dramatically since the pandemic.
"You've got much lower reimbursement as we continue to see cuts from Medicare and Medicaid through sequestration and other legislation from the Affordable Care Act," Herrman said.
Herrman said the financial challenges for rural hospitals are more significant in Kansas because the Kansas Legislature has chosen not to expand Medicaid.
That means about $1.3 million in care that the hospital does not receive for because people would qualify for Medicaid, Herrman said.
Herrman said Kansas hospitals also receive lower reimbursement rates from private insurance than surrounding states, including Colorado and Nebraska.
Rural hospitals are reimbursed at a lower rate than metropolitan hospitals.
"That's why it continues to be difficult for rural facilities when you are trying to fight off inflation, still continue to give raises to your employees and providers—the people who are here taking care of patients, as well as ancillary departments that are supporting them when they are doing that," Herrman said.
"When you are faced with rising costs and reimbursements that are not keeping up with that, you're faced with a couple of choices," he said. "Drive your revenues and decrease costs. Usually, what we have done is a combination of the two. You're trying to be fiscally responsible."
HaysMed is the only level-three trauma center in this portion of the state.
"We know the decisions that we make provide the highest quality of care, but yet in a fiscally responsible way that allows us to be here for the future generations for people here in Ellis County and throughout western Kansas," Herrman said.
Siek said he was proud of the Hays Med staff members, who have offered quality care despite the hospital's challenges.
Herrman and Siek discussed opportunities for HaysMed staff to give feedback to the administration.
Herrman said the hospital offers quarterly input sessions with staff, clinics and outreach clinics in other communities.
He said he has monthly breakfasts with staff members, regular drop-in chat sessions, and quarterly provider meetings. The hospital also surveys its staff members.
"We view what the results are with our staff and develop plans to make HaysMed an environment where people want to work. We try to improve that as much as we can," Herrman said.
Siek said the administrative team, directors and supervisors round regularly with the staff. He said he meets with charge nurses. Units and clinic committees have meetings where feedback can be given
"We take all that feedback to determine what we need to work on and what we need to change or how we can respond to that particular issue because usually if it is an issue in one place, it's an issue in more places," Siek said.
"We are always getting feedback and working on changes that need to be made," he said.
Herrman said he thought morale among hospital staff was improving.
"We know as much change as we have had in the last 18 months, we know morale is not at the peak of what it was prior to COVID," Herrman said.
"I'm not trying to say everything is perfect and sunny and a perfect world here, by no means," Herrman said. "But we have always had a really great open relationship with our providers to be able to sit down and work through what those challenges are and how do we continue to get better.
"I think if you go and look back at what the CMS star rating has been for this facility in the past to where we are now, I think you can see we have continuously raised the bar and the level of the quality of care we provide here."
HaysMed recently announced a five-star rating from CMS.
"Has the financial aspect made it more difficult to navigate? You bet 100%," Herrman said.
He urged residents to discuss Medicaid expansion and private insurance reimbursement with their legislators.
HaysMed also does not qualify for the 340B drug discount program, because it does not see enough Medicaid patients. Those discounts would be another way to assist the hospital financially, Herrman said.