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PeaceHealth offers 50-year contract;
final contract will be available for public to review
posted 01/20/2009
PeaceHealth is willing to enter into a 50-year contract with San Juan County Hospital District in which the healthcare company would purchase land for, build, operate and maintain a new medical facility on San Juan Island. The hospital district would subsidize the operations of the new Integrated Medical Center at an amount not to exceed the current Inter Island Medical Center tax levies.
"We've made considerable progress," said board chair Lenore Bayuk. "And we're very excited about where we're at...We are not going to carry a general obligation bond....There are no new taxes needed."
The progress on the contract negotiations were discussed at the January 20, 2009 hospital district board meeting. More details are still to be worked through. When a final draft is completed, it will be available to the public for review for at least two weeks and most likely a month prior to the board vote. The A sign-up sheet will be available for community members to request copies.
Proposed Contract Highlights:
- Initial term of the contract: 50 years, renewable by mutual agreement.
- Funding:
- Philanthropy will provide $10 millin toward construction costs.
- PeaceHealth will fund the remaining $20 million for the land, facility construction and equipment. This major change since the Letter of Intent responds to community concerns about taxpayers financing the new facility.
- PeaceHealth will fund the operations of the new Integrated Medical Center (IMC). SJCPHD#1 will subsidize PeaceHealth for contracted services, including 24-hour emergency room services, capped at an amount not to exceed the current IIMC tax levies. No new IIMC taxes will be needed. The addditional levy that expires in 2016 does not have to be extended.
- Ownership:
PeaceHealth will own the land, facility and the equipment with full responsibility for operation and maintenance.
- Governance: The new IMC will be governed by a Community Board, with a majority membership of island residents. The Community Board will be responsible for oversight of the IMC's quality, safety and operating performance and will have powers delegated by the PeaceHealth Board. The IMC will provide regular reports on services, quality measures and outcomes to the Hospital District Board.
- Quality of Care: High quality of care, meeting both PeaceHealth's and the Joint Commission's National Standards will be maintained. PeaceHealth has a long-standing national reputation for outstanding patient care and safety.
- Termination by PeaceHealth: This is a 50-year contract, with PeaceHealth holding the responsibility for $20 million in financing for the new facility. PeaceHealth will be highly motivated to continue operations at the IMC since their debt obligation will continue whether the IMC is open or closed.
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PeaceHealth may not terminate operations during the first 10 years.
- After 10 years, in the unlikely event that PeaceHealth should not be able to continue operations, it may terminate then, but PeaceHealth will continue to be responsible for the remaining debt on the new facility.
- If PeaceHealth were to terminate operations, the Hospital District
- would receive at least three years notice
- would have first right to purchase the land, facility and equipment at the then appraised fair market value
- would be appropriately credited in any purchase agreement for initial philanthropic funds provided by the community.
A brochure outlining the proposed contract will appear in islanders's mailboxes in the next few days. San Juan Community Hospital committee members will be available to answer questions at MarketPlace grocery store periodically during the next few weeks. Other outreach sessions are being organized. For additional information visit www.sjcommunity hospital.org
Hospital District Board approves letter of intent
posted 06/25/2008
The Hospital District Board unanimously approved a non-binding letter of intent to move forward on the proposed expanded Inter Island medical center project with PeaceHealth June 25, 2008.
The agreement is in effect for 180 days and may be extended for an additional 90 days. It goes into effect after the PeaceHealth Board signs.
The proposed facility would cost $22.8 million to build, be staffed by 44 F.T.E. (full-time-equivalents), be filled with $7 million of equipment provided by PeaceHealth and would not require an increase in taxes.
Statement of Intent
The Hospital District and PeaceHealth are executing this Letter of Intent to formally set forth their mutual intent to accomplish the following tasks in a timely manner.
3.1 PeaceHealth shall prepare and circulate in a timely manner the first draft of an Agreement for review by the Hospital District, pursuant to which:
3.1.1. PeaceHealth will agree, subject to the Hospital District's compliance with items 3.1.2.4 below, to:
3.1.1.1 Invest in all equipment, information technology and furnishings necessary to accomplish the objectives identified by the District for the integrated medical center; with such potential investment not to exceed $7 million.
3.1.1.2 Assume full operational and financial responsibility for providing all management, clerical and clinical support personnel and physicians necessary to operate the integrated medical center;
3.1.1.3 Extend offers of employment to IIMC staff and physicians (assuming their skills are needed and they meet PeaceHealth's standard employment and medical center facility shall become operational;
3.1.1.4 Establish a PeaceHealth governing board for the integrated medical center pursuant to delegated powers from the PeaceHealth and Whatcom Region boards of directors, a majority of the members of which shall be residents of the Hospital District;
3.1.1.5 Exercise due diligence to secure federal critical access designation for the hospital portion of the integrated medical center;
3.1.2 The Hospital District will agree to:
3.1.2.1 Work with local philanthropic organization to secure donation pledges in the amount of not less than $10 million for partial funding of the new integrated medical center;
3.1.2.2 Cooperate fully with PeaceHealth to perform comprehensive due diligence on the quality, services, records and practices of IIMC;
Contribute throughout the term of its agreement all regular property taxes available, after payment of the Hospital District's reasonable internal expenses, for paying part of the cost of developing the new integrated medical center, and for payment for provision of uncompensated and charity care rendered to residents of the Hospital District at the integrated medical center.
3.1.3 PeaceHealth and the Hospital District shall jointly:
3.1.3.1 Investigate the acquisition and financing of a site for the integrated medical center. Such site shall allow for the co-location of the integrated medical center and the EMS, as well as providing for future expansion to meet the needs of a growing population.
3.1.3.2 Work together for PeaceHealth to secure a Certificate of Need from the Department of Health for the hospital portion of the integrated medical center.
3.2 PeaceHealth and the Hospital District shall negotiate diligently and in good faith to finalize the terms of the document described in section 3.1, shall submit it for approval be their respective boards and shall thereafter execute the same.
Hospital District Board to make decision tonight
posted 06/25/2008
The Hospital District Board meets tonight at 5:30 p.m. (June 25) in the EMS building to decide if they will a sign a non-binding letter to move forward on the proposed expanded Inter Island medical center project with PeaceHealth.
The proposed facility would cost $22.8 million to build, be staffed by 44 F.T.E. (full-time-equivalents), be filled with $7 million of equipment provided by PeaceHealth and would not require an increase in taxes.
At an informational meeting with community members on June 11, questions were raised about population projections. It turned out there was an error on the summary page but not in the actual report. The calculations used project a total increase of 7.7 percent by 2012 when the facility would open.
The comments could be divided between those who thought the plan was too large for the island and those who thought it was time to expand to cover changing needs.
Among those who didn't believe the figures was Roni Metcalfe who works for Island Hospital in Anacortes, asked a detailed question about how a MRI machine could be transported to the island. It can't be taken on the ferry and would have to be barged, she said. It would then have to be recalibrated at the center making it unworkable she believed.
Chuck McCarty , a San Juan County Dispatcher, noting how fast EMTs left the meeting to respond to a call and said the present system of flying patients off-island worked just fine.
Others spoke in favor of the project, saying it was time to expand to serve the needs of the island. Reasons given included: The aging population, the use of $1.4 million of tax money each year to subsidize the current clinic, the time islanders spend going off island for routine procedures.
One man said, "So many comments tonight underscore the difficulties of retaining physicians in an island practice...continuing to do what we have been doing doesn't work...the solution is to change the model. Recruiting and retaining physicians in a larger integrated model is what will work...We need to take a hard look at this,".
Cable: "Financial analysis - it works"
posted 05/28/2008
The proposed expanded medical center would cost $22.8 million to build, be staffed by 44 F.T.E. (full-time-equivalents), be filled with $7 million of equipment provided by PeaceHealth and would not require an increase in taxes. Tom Cable of the San Juan Community Hospital Committee said we did the financials and "It works."
Cable explained the two-year planning process the committee went through to analyze what was needed. The population has doubled since the 34-year-old current medical center was built. "We're planning for the next 25 years," he said.
Committee member Charlie Anderson said the integrated medical center would include an expanded clinic for family practice and visiting medical specialists,
increased laboratory and imaging facilities, 10 hospital beds, a 24/7 emergency department co-located with the Emergency Medical Services (EMS). PeaceHealth would operate the facility. The hospital district would own the facility.
The presentation of the Report of Initial Findings of the Feasibility Assessment about providing enhanced access to healthcare services to the Hospital District Board drew a crowd of 100 islanders. The initial presentation will be followed by a special meeting at 5:30 p.m. June 11 in the Mullis Center for community members to comment on the report to the hospital board.
At their next regular hospital board meeting on June 25 the board will decide if they will sign a non-binding letter of agreement with PeaceHealth to continue studying the proposal.
Copies of the material presented will be available online Thursday morning at www.sjcommunityhospital.org. Anyone wanting the complete 28-page report and 40-page appendices should call 360.378.5152..
Community Hospital Committee, PeaceHealth
recommend
further study for expanding Island
healthcare services
posted 05/28/2008
PRESS RELEASE: A feasibility assessment presented today to San Juan County
Public Hospital District #1 Commissioners recommends that the Hospital District and
PeaceHealth, a Northwest-based not-for-profit healthcare system, sign a non-binding
letter of intent that would enable further exploration of expanding healthcare services to
residents of San Juan Island and surrounding islands.
The recommendation follows a comprehensive, four-month assessment of the feasibility
of creating a new $29.8 million integrated medical center on San Juan Island that would
include an expanded community clinic as well as additional outpatient services and
limited inpatient services. The assessment process was jointly led by the San Juan
San Juan Community Hospital Committee Community Hospital Committee, members of the Inter Island Medical Center (IIMC) staff, the Hospital District Board, and representatives from PeaceHealth. The group was
also supported by independent consultants.
"From the beginning, this has been a community-led effort to provide for the long-term
healthcare needs of our island residents," said Tom Cable, co-chair of the San Juan
Community Hospital Committee, a group of 14 island residents, including physicians,
allied health professionals, and business and philanthropic leaders. "This assessment
provides our community with comprehensive data that will allow us to objectively decide
how to provide for our future healthcare needs."
The community's current facility -- Inter Island Medical Center -- offers basic diagnostic
equipment and family practice services, but must send many patients off-Island for
additional diagnosis, testing and procedures. On-island services are provided in a 34-year-old facility with a diminishing ability to serve a rapidly growing population and no
additional capacity for expansion or in-patient care.
PeaceHealth was invited into the process after the Hospital Committee concluded that the island's future needs could best be served by a healthcare provider with deep experience in operating both small, critical
access hospitals as well as larger, urban medical centers. PeaceHealth has been serving
the islanders for more than 120 years, providing an array of outpatient and inpatient
services from Bellingham.
"PeaceHealth was honored to be invited into the process to consider expanding our
service to the island community. An expanded collaboration with the San Juan Island
community would be fully aligned with our mission, vision and values," said Peter Adler,
PeaceHealth's Senior Vice President for Strategy, Innovation and Development. "We
work in service to our communities, and strive to deliver safe, evidence-based,
compassionate care to every patient; every time, every touch."
The initial feasibility assessment presented to the Commissioners found that building and
operating the proposed new integrated medical center could be fully financed without
increasing taxes for Hospital District residents.
The Hospital District Commissioners will seek community input and discussion
regarding the recommendation before making a final decision on whether to sign a nonbinding
letter of intent with PeaceHealth. A special meeting of the Hospital District
Board is scheduled for 5:30 p.m. June 11 in the Mullis Center, to allow for extensive, fully informed discussion
with the community. The Commissioners, and members of the Assessment Team,
including Islanders, consultants and PeaceHealth staff, will be present to answer
questions, listen to feedback and participate in the discussion.
If approved and signed by the Hospital District and PeaceHealth Boards, the letter of
intent would allow the two organizations to further explore financial, operational and
implementation details related to building the proposed new integrated medical center.
Hospital District and PeaceHealth Board consideration and decisions are expected in late
June and July, respectively. A final decision to build and operate the proposed facility
would require an additional approvals from both the Hospital District and PeaceHealth
Boards.
The proposed new integrated medical center would house, under one roof, an expanded
clinic, a variety of outpatient services (e.g., procedures, imaging, lab), a 10-bed limited
acute care facility -- certified as a Critical Access Hospital -- and an emergency
department operating 24 hours a day, seven days a week.
The proposed facility would be staffed by 44.5 full-time equivalents (FTEs) staff, including physicians, RNs, imaging
and technical personnel, other levels of direct caregivers, and administrative support (the
current Inter Island Medical Center facility employs 25 full-time equivalent staff.) This
increased staff size would present new education and employment opportunities for
Islanders.
Visiting specialists would provide outpatient consultations and procedures. The new
medical center would use PeaceHealth's state-of-the-art information technology, and a
variety of clinical and administrative services would be provided in collaboration with
PeaceHealth. Collaborations with local Island healthcare providers would also be
promoted.
"We are encouraged by the depth of this assessment, and the picture it gives us
in terms of how San Juan Island might move forward in planning for our future
healthcare needs," Cable said. "We're looking forward to hearing more from the
community and the Hospital District Commissioners regarding the recommendation to
keep this process moving ahead."
The assessment report estimated that the costs for the proposed new integrated medical
center would be $22.8 million for the facility and an additional $7 million for all new
medical equipment, furnishings and information technology.
The facility would be
funded from a combination of community philanthropy ($10 million) and the San Juan
Island Public Hospital District ($12.8 million), with no new taxes. PeaceHealth would
fund all medical equipment, furnishings and IT ($7 million).
The proposed new integrated medical center would be owned by the Hospital District,
and operated by PeaceHealth.
For a summary and overview of the feasibility assessment's findings and
recommendations, please visit www.peacehealth.org.
San Juan Community Hospital Committee is a group of concerned islanders working
with skilled, experienced consultants, residents and potential collaborators, in an advisory
capacity to the SJCPHD #1 Board, to determine how the growing Island population could
sustain and expand on-Island access to high quality, cost-effective medical care. For more
information, visit www.peacehealth.org.
PeaceHealth is a Bellevue, WA-based not-for-profit healthcare system with hospitals and
medical centers in Alaska, Washington and Oregon that serve more than 57,000 patients
annually in both rural and urban settings. Sponsored by the Sisters of St. Joseph of Peace,
PeaceHealth has provided exceptional medicine and compassionate care to Northwest
communities for more than a century. PeaceHealth annually receives national recognition
for innovations in patient-centered care, patient safety and healthcare technology.
PeaceHealth is frequently named as one of the region's best employers. For more
information, visit www.peacehealth.org.
Feasibility Assessment Overview of Findings and Recommendations
For the past year and a half, a group of islanders has been seeking ways to expand healthcare access for our community. Since January 2008, an extensive study has focused on the feasibility of creating a new integrated medical center on San Juan Island that would have as its heart an expanded clinic, and that would also offer some outpatient services and limited inpatient services.
This study was a joint undertaking of Islanders; representatives from the Inter Island Medical Center, EMS, and San Juan County Public Hospital District #1; independent consultants; and staff from PeaceHealth, a mainland not-for-profit healthcare provider best known to Islanders through St. Joseph Hospital, Bellingham. This is an overview of the feasibility study and the recommendations of the assessment team to the Hospital District Board. The complete study report is available through the Hospital District Board Secretary at 360.378.5152.
It is the recommendation of the assessment team that the Hospital District and PeaceHealth Boards approve and execute a non-binding Letter of Intent to continue the investigation of a long-term relationship to build and operate a new integrated medical center on San Juan Island. Final Agreements, if reached, will also require the approval of the Hospital District and PeaceHealth Boards.
This initial Feasibility Assessment indicates that building and operating the new integrated medical center, as described in this report and analyzed by the assessment team, could be fully financed without any increase in taxes.
Why was a study on Island healthcare needed?
In our neighborhoods and at the market we hear the stories every day:
A physician at the InterIsland Medical Center (IIMC) is called in during the night to see a patient brought in by EMS After the patient has been treated and stabilized, she still needs a doctorˇ¦s supervision for 24 to 36 hours to make sure that no complications arise, so she is transported to the mainland and admitted to a hospital for observation. Her family has to take the ferry and stay on the mainland until she is discharged less than 48 hours later. It is stressful and expensive for both patient and family.
An Island patient has been under a mainland doctorˇ¦s care for cancer treatment, but now he needs to receive chemotherapy every two weeks for several months. Every other Tuesday he is on the ferry in the morning, at the hospital for a few hours, and back on the ferry in the afternoon. The regimen of travel and chemotherapy is exhausting.
An Island teen needs a simple arthroscopic outpatient procedure after a sports accident, but his parents must take off a day from work to take him off-island to have it done, because it cannot be done on the Island.
These are just three common examples among many that illustrate how healthcare needs are outgrowing the current mission and capacity of the IIMC to serve the community with the high quality of service that Islanders have come to expect. Our island population has received excellent healthcare for decades, but the IIMC cannot continue to provide even the current level of service as it faces increasing space and financial challenges. Our physicians are working in an aging, extremely overcrowded medical facility.
Our growing Island Medicare population is receiving service for which reimbursements are far less than the costs of care, and the gap between IIMC income and costs is growing. The status quo cannot be maintained much longer.
So what can be done?
Many possible solutions have been investigated. The IIMC has been reviewed by consultants specializing in rural medical facilities and services. Their study found that the IIMC building and infrastructure were too out of date and the facility and site too small to make renovations or additions practical. It was recommended that the San Juan County Public Hospital District #1 Board of Commissioners, which is the body responsible for oversight of the IIMC and for assuring high-quality long-term healthcare for the community, investigate alternate sites and build a new medical center, one which would be able to serve the growing population with an expanded clinic and, in addition, some outpatient and limited inpatient services.
With such an integrated facility, the stable emergency patient, the patient needing chemotherapy, and the teen needing only an outpatient procedure could all be treated on Island, with far less stress, physical discomfort intensified by having to transport from and to the Island, and expense for patients and their families. And so could many others.
But how could a small Island community support a new integrated medical center?
One way to assure that any facility created on the Island would be built and operated in a financially responsible way that the community could sustain over the long term would be to partner with a larger mainland healthcare provider. Ideally, the partner should have a history of successfully serving small, rural, isolated communities with both clinic and hospital services, and should have a mission, values and service policies compatible with our community's needs and expectations. As part of its research, the group of Islanders that has been working to find ways to expand healthcare service for the community has talked with several off-island healthcare systems, seeking one that would be a good fit to the Island. In December 2007, PeaceHealth was invited to Friday Harbor for discussions.
PeaceHealth and St. Joseph Hospital have already been serving Islanders for more than 120 years, providing an array of outpatient and inpatient services.
Improving access to healthcare and serving communities is at the heart of the mission and values of PeaceHealth, and assisting San Juan Island to create and operate a new integrated medical center would be an undertaking consistent with the work PeaceHealth has done in other, similar communities in the Pacific Northwest.
What has been the process which has begun and might lead to possible formation of a long-term relationship?
First, the Hospital District and PeaceHealth needed to have a clear understanding of the nature and needs of the community, what services a new medical center on the Island might provide, how much it would cost and how it might be paid for.
It was also important to determine the details of the facility requirements, how much and what kinds of staffing would be needed, and what benefits would come from combining the resources of the Hospital District and PeaceHealth. Only after this information was gathered and analyzed, and it was determined that the community, the Hospital District and PeaceHealth would benefit from such a relationship, would work begin (authorized by a non-binding Letter of Intent) to detail the proposed relationship between the two organizations.
All final financial, operational and governance details would have to be spelled out and approved by the Boards of both the Hospital District and PeaceHealth before an integrated medical center project could be undertaken. The initial information gathering phase of this project has been completed and the findings noted in the detailed Feasibility Assessment V Report of Initial Findings.
How has this initial information been gathered?
For the past four months, several dozen people including members of the Hospital District Board; EMS; personnel from the IIMC; staff from PeaceHealth; independent consultants knowledgeable about rural healthcare facilities, and services, and State of Washington laws and facility certification requirements; and members of the community have undertaken an intensive study of the major areas of interest mentioned above.
Data presented in the report represent best estimates of realistic needs and trends based on historic and current use of both Island and mainland healthcare services by Island residents and, in some cases, forecasts from leading healthcare research/analytical sources. Projected costs and services were verified by comparing data from similar facilities and environments. National and professional standards guided estimates of, for example, space needs. Great effort was made to assure that the data are realistic, not "manufactured" or skewed.
What was the starting point of the study?
The first work of the assessment team overseeing the study was to develop the basic principles that would guide the planning for the envisioned integrated medical center.
These principles covered a number of different topics:
- Mission and Vision: We commit to explore opportunities and options for a possible relationship that enhances and expands access to the highest quality healthcare services and facilities for the
- Patient-Centered Care: Doing the right thing for patients and their families will always remain the primary focus of our work.
- Quality and Safety: We share a strong commitment to increase access to safe, evidence-based care of the highest quality on San Juan Island.
- Collaboration and Choice: Maintaining good relationships with other on-island and off-island providers to support patient choice is important and valued.
- Community-Centered/Mission-Centered Care: On-Island services must continue to be designed to serve all patients, regardless of their ability to pay.
- Island-Appropriate-Care: Expansion of services must be appropriate for the Island's setting and realities (e.g., depth of back-up support, seasonality, etc.)
- Integrated Care: Enhancements will improve continuity of care and knowledge-sharing among a patientˇ¦s healthcare providers (e.g., development of a common, fully integrated medical records system across care settings).
- Sustainability and Stewardship: Expanded services and associated infrastructure must be sustainable for the community, the Hospital District, the on-Island physicians and healthcare providers, and PeaceHealth.
- Technology: Fully utilizing available technology will support the delivery and maximize the coordination of care by a patientˇ¦s primary physician (e.g., telemedicine, shared digital imaging, etc.)
- Form Follows Function: Community needs and the selected, expanded healthcare services will determine the nature and structure of the new medical center.
What did the study reveal about the scope of the services that could be supported by an integrated medical center that included some outpatient and inpatient care?
The integrated medical center would offer an expanded setting for clinic services already provided by the IIMC and would include additional space for an increased number and variety of services.
Much more convenient scheduling would be possible since there would be greater capacity for meeting primary care needs and adequate space for the equipment for such diagnostic evaluations as cardiac stress tests, mammography, sonograms, and electrocardiograms which now occupy and often share cramped and inadequate spaces. Outpatient services would be available, largely through visiting specialists, in such areas as dermatology, hearing and speech examinations and therapy, colonoscopy, GI diagnostic testing, endoscopic nasal and sinus procedures, infusion and transfusion, pain management, allergy evaluation and treatment, for example.
Also available would be some outpatient surgeries which are normally performed in a procedure room rather than in an operating room. These might include cataract procedures, middle and inner ear procedures, and hernia repair, for example. Expanded diagnostic services including CT scan, bronchoscopy, and mobile MRI would be available.
The integrated medical center would be planned to meet the standards of a Critical Access Hospital (CAH). This is a federal designation, certified by the State of Washington for small rural hospitals serving isolated populations. It allows for increased reimbursement for hospital services. The limited inpatient services offered in our new integrated medical center would provide, for example, supervised acute care and care for those patients no longer needing post-surgical hospitalization at a mainland hospital but who are not ready for skilled nursing home care.
No inpatient surgery would be offered for the first five years after the integrated medical center opened, but this could be re-evaluated in future years. Patients who need to be under observation for a day or two would receive care in an appropriate setting. Islanders who need short-term care after surgeries or other procedures would be able to have the medical supervision and assistance needed. Medical cardiology, medical oncology, and services in such areas as body injuries, gastroenterology, rheumatology, and neurological degenerative disorders, for example, would be available.
A number of outpatient and inpatient procedures would NOT be performed at the integrated medical center; these include obstetrics and delivery, cardiac catheterization and heart surgery, cosmetic procedures, bone marrow procedures, upper GI surgery, brain surgery, neurosurgeries for peripheral nerve disorders, joint replacement, nuclear medicine, radiation therapy, spinal fusions, head and neck surgery, plastic surgery, and vascular surgery, for example. The variety of services offered might expand or be modified over time as Islanders needs direct.
Do we have enough San Juan Island residents who will want and use these expanded services on Island?
An important part of the study looked at the actual data about what kinds and how much service Islanders are already seeking in off-Island hospitals. The State of Washington requires all hospitals to report a variety of data on all patients discharged from their facilities, including the zip code of each inpatient. From these data it was possible to determine how many of what kinds of services Islanders have needed in the past. Realistic projections were then made to determine whether there was enough demand to support safe, high quality care for selected and proposed services.
These projections were further refined to take into account that the use of the new medical center would grow gradually over time and not reach projected numbers until the community had become familiar and comfortable with the new medical center and was convinced of the high quality of the service available. It was clearly understood that many Islanders will continue to prefer to utilize mainland healthcare providers for some or all of their care, and that was factored into the estimates of probable demand for local service. Patient choice would continue to be respected.
All of the data discussed in this overview are detailed in the full report. Who would be providing all these services?
The primary care physicians, nurses, and staff who currently serve the community in the IIMC would be the core group of medical care providers and support staff. Additional physician hours, as well as hours for RNs and other care providers, would be needed to staff the emergency department full time and for the limited inpatient services. Staffing needs were determined based on current IIMC staffing patterns, discussions with IIMC staff, and anticipated services and number of patients; the data were then verified against other CAH facilities of comparable size and in similar environments. Currently the IIMC employs 25.3 FTEs (full time equivalents). It is estimated that a total of 44.5 FTEs would be needed to staff all the clinic, outpatient, and limited inpatient services.
This includes administrative, office, imaging and technical personnel, physicians, RNs and other levels of direct caregivers, as well as support staff. Many of these additional positions would represent employment and education opportunities for Island residents.
It is anticipated that regularly scheduled, visiting medical specialists would provide most of the outpatient procedures, and that these physicians would bring their own support staff with them to assure efficient, high quality care for the patients. A long-term relationship with PeaceHealth would offer many benefits to the medical center including access to PeaceHealth's sophisticated recruiting and staffing capabilities and deep expertise in providing healthcare services in remote, island, and small communities.
All prospective medical center physicians and staff would be evaluated to assure that they would have not only the appropriate technical and educational qualifications, but that they would provide patient-centered, high quality, compassionate care in support of the mission and values of the integrated medical center and PeaceHealth to provide the best possible care to every patient every time.
How big a facility would we need to have an integrated clinic /outpatient /inpatient medical center?
In order to estimate the space needed for the integrated medical center, a conservative estimate of the number of patients who might seek island-appropriate clinic, outpatient or inpatient care were applied to industry-standard small medical facilities planning formulas. Based on projected need, the total facility was estimated to be 42,242 sq. ft. which would include 24,492 sq. ft. of clinic space, 3,500 sq. ft. for the emergency department, and 14,250 sq. ft. for outpatient and inpatient space. Medical facility space includes two categories of construction termed ˇ"I" space and "B" space. Acute care and space for some outpatient procedures requires that ˇ§Iˇ¨ space standards prevail which are reflected in higher construction costs. The majority of the new medical center would be classified as ˇ§Bˇ¨ space, which meets different medical facility standards and is less expensive to build. The hospital is projected to be a 10 bed facility. No inpatient operating rooms would be equipped in the initial construction, because currently planned outpatient services could be provided in procedure rooms suitable for a wide range of safe, service provisions. Some additional spaces could be "shelled out" which would assure their appropriate integration into the initial plans and construction, but they would not be finished or furnished until needed, therefore reducing building costs while accounting for future demand.
How much would this integrated medical center cost to build, and how would it be paid for?
The estimated total capital cost of the medical center is $29.8 million: $22.8 million for the building and $7million for medical, technical and other equipment. In addition to the actual construction, this cost includes government-required site studies and reports, architectural and engineering services, project management, fees, furnishings, information technology, medical equipment and other facility construction-related costs. It also includes sales taxes, a 10% contingency allocation and a 10% cost escalation factor.
Building the integrated medical center would be financed through several sources: Community philanthropy $10 million PeaceHealth $7 million (approximate figure for all furnishings, medical equipment, IT equipment and installation, and other equipment) Hospital District $12.8 million (net cost remaining after above contributions)
Would taxes have to be raised to build or operate the integrated medical center and to fund the Hospital Districtˇ¦s contribution?
The capital budget and financial model that have been developed do not indicate the need for additional taxes. The Hospital District currently receives an annual tax levy of $1.4 million. A limited tax, general obligation bond could be obtained based on commitment of $950,000 of the levy; this would produce enough money for the Hospital District's contribution, and still retain sufficient levy each year to contribute to the ongoing costs of charity care for Island residents who did not have insurance or the ability to pay for all of their care. Since PeaceHealth would assume full responsibility for operating the medical center and due to its reimbursement rules, there would be a reduced need for the levy to support the cost of operations.
Could the integrated medical center be financially sustainable over the long term?
Financial experts working on the study have prepared a five-year forecast for the integrated medical center. The figures they used were based on assumptions outlined above concerning the number of patients, clinic visits, and use of outpatient and limited inpatient services. It was assumed that the new, integrated medical center would have Critical Access Hospital designation which would allow it to receive cost-based reimbursement for Medicare patients, and that the clinic would be designated as a Hospital-Based Clinic and therefore also receive cost-based reimbursement for Medicare patients seen in the clinic, a substantially higher reimbursement than is available to rural health clinics such as the IIMC. Projected financial data were verified against data from comparable CAH facilities and PeaceHealth's decades of experience serving rural communities with similar integrated clinics and Critical Access Hospitals.
In the first year of operation, it is anticipated that the integrated medical center will sustain a $257,132 loss. By the third year, it is expected to break even, and by the fifth year to show a profit of $183,417. Thereafter, the integrated medical center is expected to continue to operate in the black. A long-term relationship with PeaceHealth would deliver stability and numerous financial
savings through, for example, full use and on-island extension of their electronic medical record, ongoing clinical training programs, national recruiting programs, large volume purchasing, etc. In 2007, the IIMC had patient revenues of approximately $1.79 million. The projected first year operating revenue for the new medical center is $7.9 million.
How would the operating deficits be paid?
If PeaceHealth and the Hospital District were to form a long-term relationship to create and operate an integrated medical center, each party would contribute to the project. The Island community would own the land and build the facility, and PeaceHealth would assume full responsibility for its operation.
No new tax revenues are projected to be needed to build or operate the integrated medical center. The existing tax levy revenue would be used to first cover the interest on the Hospital Districtˇ¦s bonds, and the remainder would continue to be used to offset as much of the cost of charity care to Island residents as possible.
Who would govern the new integrated medical center?
Governance and oversight of the integrated medical center would be provided through a local Governing Board, operating with delegated authority from the PeaceHealth Board. The community would own the land and build and own the facility. PeaceHealth would assume full responsibility for operations.
The local Governing Board would be responsible for overseeing the quality, operations, and performance of the integrated medical center. This Board would consist of a majority of members from the community, as well as representatives from the Hospital District Board and PeaceHealth. Details of the long-term relationship between the Hospital District and PeaceHealth would need to be negotiated as part of the full relationship agreement. What would be some of the ways in which the proposed relationship with PeaceHealth would contribute to the new integrated medical center?
Physicians in the clinic would become members of the PeaceHealth Medical Group, and collaborative relationships with other Island providers would be facilitated. Local pharmacists and physical therapists would continue to have important roles in serving the community including, perhaps, in the integrated medical center as well as through their current facilities. It was also assumed that some outpatient procedures would be undertaken by visiting specialists. These specialists would have scheduled periodic clinics on the Island in the new, well-equipped facility, and many would be accompanied by their own clinical support teams, thus relieving the local medical center staff of additional stress and schedule coverage.
Integration of Island medical center operations and PeaceHealth would occur in multiple ways. Some administrative support services (e.g. billing, insurance, purchasing) would be provided centrally by PeaceHealth to take advantage of their existing expertise and scale. Integrated, secure, and confidential electronic medical record would be available to support all providers and services in the new medical center and throughout the San Juan and Bellingham communities (inpatient, outpatient, specialty and primary care) which would enable seamless referrals, care coordination, communication, and support of patients as they move through the community, as well as on and off island. Referrals would continue to be made to mainland hospitals for inpatient surgery and other complex procedures and advanced care.
Patients would always have a choice as to where they wish to be referred for the off-island care, and referrals would be supported through the integrated electronic medical record.
Is this study a final definitive statement of the details of finance, construction, operations and governance of a potential integrated medical center for the Island?
No. This study was undertaken to provide the initial information that would be needed by the Boards of both the Hospital District and PeaceHealth, to make decisions about whether to pursue a non-binding Letter of Intent.
Many more service, facility, financial and other details would need to be worked before a final long-term relationship agreement could be completed. This report is one of the first, not the last, that is needed to continue the evaluation of a possible long-term relationship.
Should the Hospital District Board and PeaceHealth continue to work towards defining the terms of a relationship agreement?
Yes. It is the recommendation of the assessment team that the Hospital District and PeaceHealth Boards approve and execute a non-binding Letter of Intent to continue the investigation of a long-term relationship to build and operate a new integrated medical center on San Juan Island. Final Agreements, if reached, will also require the approval of the Hospital District and PeaceHealth Boards.
Hospital Board agrees present site
likely to be unworkable for a hospital
posted 02/21/2008
San Juan County Hospital Board Commissioner Michael Edwards agreed with consultant Joe Kunkel's assessment that it would be unrealistic to use the current site of the Inter Island Medical Clinic as a site for a hospital. He suggested the board ask the committee researching the feasibility of building a critical access hospital to include a study of an alternative site.
The motion was approved by the board at the Feb. 20, 2008 meeting. Asked if this meant the current site was completely ruled out, Commissioner Bob Low said, "The short answer is no." The current site's location next to the convalescent center and closeness to town are pluses. The study of an alternative site will be borne by the committees not by the hospital district.
Edwards said the two hospitals operated by Peace Health which members of the committee visited are located on 10- and 22-acre sites. Ideally, according to Kunkel's report, the project would be located on at least 10 acres and preferably 15 acres which leaves room for growth in the future.
The reasons against the current location on Spring Street included having to operate the clinic and Emergency Medical Services (EMS) in a construction zone for 20 months, and needing to build on multiple levels rather than just one floor. The inability to locate a helipad onsite could cause delays which could be the difference between "life and death" according to Kunkel's report.
The cost and difficulty of buying up enough neighboring property to make the project possible in its current location was another drawback.
Hospital committee considering partnership with PeaceHealth
posted 01/17/2008
San Juan Community Hospital Committee and PeaceHealth, a not-for-profit healthcare system with hospitals and medical centers throughout the Northwest, will conduct feasibility studies during the next 120 days about possible partnership opportunities to expand the provision of healthcare services to the residents of San Juan Island.
The hospital committee has been researching the costs of creating a community access hospital. At the Jan. 16, 2008 Hosptial District Board meeting, SJCH Co-chair Tom Cable said if the partnership worked out he expected philanthropy would cover much of the building costs and the bond needed would be less. The hospital committee is an independent group and is not part of the hospital district board.
The SHCH committee and PeaceHealth will spend the next four months identifying and analyzing potential healthcare service expansion opportunities, including the addition of a small, state-of-the-art Critical Access Hospital that would be located in Friday Harbor.
The Committee will provide periodic updates to the San Juan County Public Hospital District #1 ) Board of Commissioners and to the community through public meetings, the committee's Web site and periodic news releases.
"By May 2008, we will provide an informed recommendation to the hospital board regarding the feasibility of this potential partnership," said Cable. "We welcome working with PeaceHealth on this assessment. They bring a strong reputation as a compassionate, community-based healthcare provider that delivers high-quality, patient-centric services and care. And that's our ultimate goal-expanding the range of and access to quality, on-island healthcare services."
Inter Island Medical Center currently offers basic diagnostic equipment and services, but must send many patients off-island for additional dianosis, testing and procedures. On-island services are provided in a 34-year-old facility with a diminishing ability to serve a rapidly growing population and no additional capacity for expansion or in-patient care.
"Improving access and serving communities is at the heart of who we are," said Peter Adler, PeaceHealth's senior vice-president for strategy, innovation and development. "We were happy to be contacted by the San Juan Hospital Committee and look forward to working with the committee and the San Juan community to explore opportunities to expand access and healthcare services on the island."
Background: The SJCH committee is a group of islanders working with consultants, residents and potential partners, in an advisory capacity to the hospital district board, to determine how the growing island population could sustain and expand on-island access in high quality, cost-effective medical care. More information is available on www.sjcommunityhospital.org
PeaceHealth is a Bellevue, Washington based not-for-profit healthcare system with hospitals, medical centers and physicians in Alaska, Washington and Oregon that serves urban, rural and remote communities with state-of-the-art care and healthcare services. Sponsored by the Sisters of St. Joseph of Peace, PeaceHealth has provided exceptional medicine and compassionate care to Northwest communities for more than a century. PeaceHealth annually receives national recognition for innovations in patient-centered care, patient safety and healthcare technology. PeaceHealth is frequently named as one of the region's best employers. For more information, visit www.peacehealth.org
Critical Access Hospital process continues
By Sharon Kivisto
According to the state Department of Health: "The Critical Access Hospital Program was created by the 1997 federal Balanced Budget Act as a safety net device, to assure Medicare beneficiaries access to health care services in rural areas. It was designed to allow more flexible staffing options relative to community need, simplify billing methods and create incentives to develop local integrated health delivery systems, including acute, primary, emergency and long-term care."
The San Juan County Hospital Board which oversees Inter Island Medical Center and SJ EMS heard an update at their Feb. 21. 2007 meeting on the progress of the feasibility studies underway about creating a CAH on San Juan Island. The results of the telephone survey showed the majority of islanders were in favor of having a CAH. Hospital District Commissioner Michael Edwards who also is a member of Inter Island Healthcare Foundation said, ":We (Inter Island Healthcare Foundation) committed $30,000 for studies, and another $40,000 for additional studies." There are a dozen subcommittees and steering committees working on various aspects of the project. No decision has been made yet on whether it is financially feasible to have a CAH on the island.
A CAH office has been opened in the Sustainable Technology Center. An open house is planned for mid-March. Public outreach and an educational campaign will begin soon.
During the audience participation period of the Feb. 21 meeting, Richard Babbitt questioned the board members for 20 minutes about the CAH project. He was skeptical about the validity of the telephone survey. "Why was the survey taken in the middle of the winter when the majority of the population has left for warmer climates?" he asked. "The wealthier residents, who pay the property taxes, are in Palm Springs."
He didn't believe the island could afford a CAH and suggested instead residents could just use Island Air's air ambulance to fly to a mainland hospital or take advantage of the newly reinstated subscription service for Airlift medevac helicopter service.
IIMC CEO Beth Geiger said the survey was taken when it was because "we wanted to get the people who lived here year round." She noted research showed $18 million in healthcare is leaving the islands every year. "If you took all the hospital admits and backed out all the ones we couldn't do, on any given day there would be five people in the hospital," she said." She emphasized whatever is done would be "island appropriate."
Inter Island Medical Center is supported by income from patient services and by local property taxes. One of the questions being researched is whether more tax support would be needed for a CAH. The increased revenue from being able to recover at a higher rate for costs already incurred may offset increased costs. In other words, services rendered at Inter Island Medical Center can only be billed as a doctor's visit for Medicare even when they are after hours and are more appropriately billed as emergency etc.
In the survey respondents who were in favor of the project were asked if they were still supportive of the project if a tax increase was deemed necessary. The majority were still in favor of the project.
At the end of his remarks to the board, Babbit again referenced the survey, he said, "You got the people who don't pay into the tax base. People who leave the island in the winter own bigger pieces of property. The ones that stay here don't have the wherewithal to go to southern California or Hawaii in the winter time."
Asked if he would like to join one of the subcommittees which is researching the project, Babbitt declined.
Results of telephone survey
indicate support for community hospital
posted 02/21/2007
PRESS RELEASE:
At the request of the Community Hospital Project Steering Committee, a phone survey of 560 San Juan County residents was taken by Health Facilities Planning Inc. in January. The survey explored the possibility of creating a small community hospital not only to replace the current Inter Island Medical Center but also to provide services for patients of all healthcare professionals in the county.
The survey explored the general feeling of residents as to the importance of health care improvements relative to other issues facing the community. Of a variety of local issues tested, the highest percentage of respondents (69%) ranked “Improving Health Care” first.
When asked directly whether they thought that Friday Harbor and San Juan Island need a new hospital, 84% of the respondents clearly indicated yes. Importantly, 87% of the residents also indicated they would use the new hospital for as much of their medical care as possible.
92% of the residents thought that this project would benefit the community.
Although the details of the project are yet to be defined, 72% of voters were willing to support construction of a new facility through additional taxes:
The hospital and its range of inpatient and outpatient services will be designed to be financially self-sustaining, but the survey further tested the strength of support by asking the difficult question of continued operational support through taxes in the event it is needed. 64% indicated their strong support.
In addition, the residents of Orcas and Lopez Islands would substantially support a new Friday Harbor hospital as follows:
- 45% believe that the county needs a new hospital in Friday Harbor.
- 55% would use the new hospital.
- 59% felt the hospital would benefit the Lopez and Orcas residents.
82% of responders indicated that local providers are doing a good job, and satisfaction with primary care wait times was better than 90%, but the survey clearly indicated that significant improvements are desired in the number and variety of medical, emergency and diagnostic services offered locally.
Based on the very positive results of this survey, the Community Hospital Project Steering Committee is moving forward to determine the range of services to be offered, the capital costs, and the financing of the new hospital.
The Community Hospital Project, with financial support from the San Juan Island Community Foundation and the Inter Island Heathcare Foundation, has established an office in the Technology Center, 640 Mullis Street. You can drop by, call at 378-2017, or email at hospital@rockisland.com.
Telephone survey underway Jan. 17-28
for community hospital feasibility
posted 1/15/2007
PRESS RELEASE: A group of islanders has come together to explore the possibility of creating a small community hospital on San Juan Island. As part of a feasibility study, 560 county residents will be called between January 17th and 28th and given the opportunity to help shape the final proposal. Organizers aske it you are called, please take a few minutes to talk with the surveyor.
Why do the islands need a hospital? Sooner or later almost everyone must leave the islands for a meaningful portion of their medical care. A small local hospital would relieve the stress of those off-island trips as well as provide a continuity of care not now possible. It would also bring relief to those suffering from chronic problems who now must be treated off island. And it would relieve financial stress.
It would expand the availability of urgent and emergency care on the island. Basic diagnostic services currently available only on the mainland would be offered. In addition, a hospital designation would make it financially feasible to offer services such as colonoscopies.
A hospital would provide overnight inpatient monitoring not currently available on the island.
What would the hospital be like?
This would be a hospital with Community Defined Medical Services. The services would be shaped by the telephone survey, by feedback from outreach organizations, and from professional statistical analysis, as well as feedback from individuals through questionnaires or other response methods.
The hospital would be Island Appropriate, with expanded outpatient services and limited inpatient capacity. There would be appropriate technology for the services provided. The architecture will blend in with island surroundings. Most importantly, this hospital would be created by islanders for islanders.
Mainland Quality Services would be offered at the hospital. Services would be equal in quality to mainland services or they would not be provided. In addition, this expanded island medical facility would allow for integrated case management and health care coordination, as well as inter-operative medical records. It would include state of the art equipment and diagnostic capability for services provided.
The hospital would form Partnerships with Regional World Class Health Care Organizations, including major public organizations such as UW Medicine, Seattle Cancer Care Alliance, VA Puget Sound Health Care System, St. Joseph Hospital, and Island Hospital. It would also partner with private institutions such as the Institute for Systems Biology and the Institute for Systems Medicine for new patient care technology and services. Partnerships with local public institutions would also be pursued. All these interactions would include clinical and/or education opportunities.
The hospital would be Fiscally Responsible—with the goal to have a financially sustainable mix of services. Also, the hospital designation would allow for significantly higher reimbursements from Medicare.
So when that phone rings, think about what such a medical center could do for you and other islanders—talk to the surveyor, and help out by offering your sincere opinions.
Community hospital may be built on San Juan Island
posted 10/04/2006
A 10 to 15 bed community hospital created through the "Critical Access Hospital" designation could provide better access to more services, in a safer and more comprehensive setting to patients of all ages in San Juan County according to Inter Island Medical Center Director Beth Gieger.
The medical center participated in a three-year demonstration project looking at the option of becoming an extended stay facility. With one year to go, it has been determined that such a designation will not meet the hospital district's needs. Extended care allows for reimbursement for stays of more than four hours.
"We found in our data our stays are just under four hours. Extended stay would not really be doing it for our community," Gieger said at the Sept. 20 hospital district meeting.
The next step up from extended stay facilities is a critical access hospital (CAH). Federal legislation enacted in 1997 authorized states to establish CAH in rural communities. These hospitals receive 100 percent reimbursement for medicare, according to Gieger. EMS will be able to be reimbursed by medicare for transport to the hospital. Currently they are not reimbursed when transporting a medicare patient to the medical center.
A CAH on San Juan Island could provide for:
- expanded emergency and observation services
- improved diagnostic ability - possibly MRI or CAT
- chemotherapy
- rehabilitation or swing beds
- birthing room
- mental health services including place for observation
There will be a meeting in Olympia in early October about the CAH.
The next steps in the process are:
- A feasibility study to determine the health care needs of our county and island appropriate services to meet those needs.
- A Certificate of Need. This is a regulatory process requiring health care providers to obtain state approval to offer new or expanded services - ensuring the services are needed within a particular region or community.
- Critical Access Hospital designation application. This will be the last step in the process to acquire state approval to create a Community Hospital for the San Juan Islands.
The benefits of a Community Hospital via a CAH designation:
- Improved medical care and access
- Reduced cost to access
- Local inpatient hospital beds
- Keep more health care dollars in the county. Currently more than
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