Shelby County Mayor Joe Ford and the Shelby County Commission may have come up with a way to keep the doors open to the Emergency Department of the Regional Medical Center at Memphis (The MED), which were slated to close this month.

 

“We’ve had some great meetings and made great progress,” said Ford, chairman of the 23-member task force appointed in November to come up with solutions to The MED’s revenue crisis. “Every member has had input. Every member has taken this task to heart. We’re going to keep meeting until we solve this problem.”

 

The MED Board of Directors voted in October to recommend closing the Emergency Department of the county-owned hospital if it could not secure $32 million in additional funds by Feb. 1. Immediately following the board’s vote, The MED turned over the matter to the Shelby County Commission.

 

At the task force’s first meeting on Dec. 3, Shelby County Commissioner Mike Ritz pointed to Tennessee as the primary culprit for failing to pay its share to The MED. Even though The MED generates more than $80 million in federal funding for the state, it receives less than half that.

 

“We’d like to get a bigger piece of that pie,” said Ford. “If we were getting the money that should be coming to us, we’d have enough to cover the budget shortfall and begin construction of a new hospital. But right now, the state uses the formula that divides the money between the poor counties throughout Tennessee.”

 

The task force studied the federal funding formula and considered an initiative being proposed for a hospital bed tax in Tennessee that would reimburse hospitals burdened by the costs of uncompensated care. Leaders at Methodist Le Bonheur Healthcare Inc. and Baptist Memorial Health Care Corp. have expressed disappointment with the proposal, which excludes St. Jude’s Children's Research Hospital.

 

Even though talk of a lawsuit emerged as a possible remedy to The MED’s financial crisis, task force members agreed that legal action wouldn’t provide the required immediate fix. “Commissioner Ruiz brought that up,” said Ford, “and it’s still something we’re considering.”

 

Looking to Arkansas and Mississippi for additional monetary support was not a high priority, said Ruiz, who views the two neighboring states “as the last two ornaments on the Christmas tree.”

 

Even so, The MED received an early Christmas gift from Arkansas. State Rep. Keith Ingram (Crittenden County) presented a $500,000 check from the state’s tobacco fund, with a similar guarantee through 2011. Also, state lawmakers approved $2.5 million a year for The MED.

 

“That works out to about $3 million a year over the next three years,” said Ford.

 

Concerning Mississippi’s financial support, “We haven’t heard anything in a while,” said Ford.

 

Jim Craig, director of health protection for the Mississippi State Department of Health, said The MED has and continues to participate as a Level 1 Trauma Center through the Delta Trauma Care Region in the Mississippi Trauma Care System. 

 

“As such, funding has and continues to be provided to The MED from the Mississippi Trauma Care System,” he said. “Most recently, in December 2009, $1,850,282 in Trauma Care Trust funds were dispersed to the Delta Trauma Care Region for hospitals providing services from Jan. 1 to June 30, 2009. For this time period, The MED cared for 355 Mississippi Trauma patients and should be receiving $732,544.”

 

Complicating matters for The MED, its contract ends March 1 with FTI Cambio, a consulting firm providing interim management of The MED and proposing cost-cutting strategies during the hospital’s fiscal crisis. The firm’s $10.4 million, 18-month contract inked in 2008 ties $3.2 million to performance specifications that would save The MED $25 million a year. Board member Steve Priddy calls the savings—$11.2 million in labor, $7 million in improved revenue cycles, $3 million in human resources benefit changes, $2.1 million from spinning off the clinics, and $1.5 million in supply chain—“evergreen savings” that would “roll forward for many, many years.” The savings would also go a long way toward construction of a $350 million, eight-story hospital bed tower on The MED's campus, which was recommended in a recently released “white paper” on long-term goals to better serve the Memphis-area population. The target date for construction to begin is 2014.

 

“Some of the equipment at The MED is in pretty bad shape,” said Ford. “The new hospital would take care of a couple of problems at once.”

 

Board chairman Gene Holcomb said The MED is already taking steps to appoint a new executive team, with Reginald Coopwood, MD, CEO of Metropolitan Nashville Hospital Authority, mentioned as the leading candidate for the top leadership post.

 

On Dec. 7, following an FTI Cambio recommendation, the commission approved spinning off The MED’s Health Loop clinics to Memphis Health Center, a federally qualified health clinic that can receive reimbursements for caring for the uninsured that the county-owned hospital could not. If approved by the hospital board and federal officials, Shelby County would provide $2 million to help cover transition costs, which includes new equipment. Memphis Health Services has agreed to continue operating the clinics at their current locations for three years, unless there is a change in federal funding. The MED has already closed four of its 10 clinics.

 

Under the proposal originally submitted by The MED board, services at the hospital’s emergency room would be greatly reduced because of rapidly escalating costs of treating the uninsured and the trend of insured patients seeking treatment elsewhere. Even though it isn’t built to seismic codes, the hospital’s Level 1 trauma center would remain open.

 

“Remember that hospitals cannot turn anyone away,” said Ford. “The trauma center will remain open and it’s our goal not to close the emergency room. That was one of the options laid out on the table. Do we close the trauma center? The burn center? The emergency room? The emergency room was thrown out on the table. It’s not etched in stone. It requires the final approval of the county commission. And I don’t see the county commission closing the emergency room. Instead, we’ll try to find the funding to keep the doors open.”