LOWVILLE Lewis County General Hospital will seek a critical-access designation in hopes of seeing millions of dollars in increased Medicaid and Medicare revenues each year.
The county-owned hospitals board of managers, by a 10-0 vote Wednesday, authorized administrators, with assistance from Stroudwater Associates, to submit an application to the state Office of Rural Health for the proposed designation shift. The process is expected to take three to four months.
Making this move is not requiring us to cut any services, said board member Michael F. Young.
The hospital in 1999 was granted sole-provider status, which allowed higher Medicare and Medicaid reimbursement than in previous years. A change to critical access would offer even higher reimbursement.
Stroudwater in a recent study projected that the facility could see a roughly $3 million annual benefit over the next few years by gaining a critical-access designation.
That would include a low-volume adjustment payment of, on average, $700,000 per year.
The hospital last year received $1 million from that program, designed to assist hospitals with declining patient volumes, and is close to qualifying this year, said hospital CEO Eric R. Burch. However, changes in the program mean that the funding will likely not be available to sole provider facilities in coming years, while critical-access hospitals are to receive it automatically.
Newly hired interim Chief Financial Officer Richard Borschuk, who has past experience working with critical-access hospitals, said he believes the study actually underestimated the low volume benefits by about $300,000 annually, making the three-year upside closer to $10 million.
While now licensed for 54 acute-care inpatient beds, the hospital, if designated as a critical-access facility, would be limited to no more than 25 inpatients at any given time. However, hospital officials believe that threshold should be attainable.
The beds arent in service now, Mr. Burch said.
The facility on Wednesday had 14 inpatients, roughly the average daily number for the year, and only reached 25 patients on two days so far this year, Director of Acute-Care Nursing David L. Wood said. Some days only saw three to five inpatients, he said.
Several of the current beds could also be designated for observation patients who stay for only one day or less without counting against the 25-bed limit, so long as a sign is placed on the doors, Mr. Wood said.
While the addition in January of a hospitalist service to handle after-hours admissions is expected to increase inpatient numbers, they will likely still stay below the threshold, board President William H. Wormuth said.
Wed have to have a 60 percent increase on average to go over 25, Mr. Young said, adding that the trend is toward more outpatient procedures.
If granted critical-access status, periodic spikes over the threshold would just need to be reported to the state, although the hospital could lose the designation for regularly exceeding the cap, Mr. Burch said.
Hospital managers suggested there would be little downside in seeking the new designation.