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Northfield Hospital Board Meeting - June 29, 2014

July 1, 2014 at 9:59 am
By Dave Emery

Medical Staff Reports

1. Chief of Staff—Dr. O’Halloran: No report. 

2. Clinic Medical Director Report—Dr. Flannery: No report.  

3. Allina Clinic Report—Dr. Keith Olson:  No Report.   

4. CMO Report—Dr. Jeff Meland: Dr. Meland reported that the monthly Clinical Executive Meetings are very productive as a means to coordinate and standardize clinic practices and for resolving problems. 

City Business Report:

No report. 


A.  CEO Report—Steve Underdahl.  A proposal is in place to provide evening coverage for physicians so most clinical practitioners won’t need to be on call.  Twelve MDs from the Allina Clinic and Family Health Medical Clinics have volunteered to rotate coverage.  The physicians will be paid for their services and will serve patients from both clinics.  Dr. Meland made the points that a) health care has become more demanding and b) the procedures and paperwork for clinical practice differ significantly from the procedures and paperwork for hospital practice, and c) that most physicians don’t want to do both.  The physicians providing evening coverage will receive additional training.  The plan should reduce the burden on clinical practitioners.   

Negotiations are underway with Mayo on the Professional Services Agreement (PSA) for physicians.  Both parties have signed the confidentiality agreement.  Two sessions have been held and the parties have agreed to draw up a Memorandum of Understanding.  The process is to be completed by Sept. 

Underdahl commented that the Work Sessions with the City Council are very helpful.  NH&C recently presented their overview of strategic priorities. 

Work continues on buildings and facilities.  The MRI remodeling project is underway. A proposal for another remodeling project to create additional exam rooms will be discussed at the July Board meeting.  Additional space will be needed for endoscopy soon.  NH&C has commissioned a study assessing long-term care needs in the Northfield area.  

Hospital staff is planning a site visit to the independent surgery center in Wilmar MN as part of their long range planning. 

B. Compliance Plan Update—Laura Peterson.  The Center for Medicare Studies requires that the processes used by each hospital to admit, classify, and process Medicare patients be audited and reviewed annually.  Laura presented the results from the 2013 audits.

1.  The payment patterns based on the coding done by NH&C showed the facility to be slightly below the norm meaning that the facility receives lower payments for services than average.

2. The private firm hired by Medicare to audit admissions, inpatient vs. observation, did not report any major problems. Medicare pays less for patients admitted for observation.

3.  An audit of Medicare inpatient admissions at NH&C indicated that the necessary documentation was frequently incomplete.   The result may be a denial of payment to NH&C.  The hospital is working with physicians to correct the problems.  A comment was made that the documentation “is mind numbing work for doctors”.  The Board urged the administration to explore ways to solve the problem.

4.  Several other audits and assessments were completed during the year.  No serious problems were found. 

C.  Nurse Staffing: New Reporting Requirements—Tammy Hayes.  The Minnesota Staffing Plan Disclosure Act of 2013 requires hospitals to file a standardized report on nursing staffing levels.  The report compares the anticipated inpatient admissions and a priori planned staffing levels to the actual inpatient admissions and actual staffing levels achieved at the time of service.  The projected and actual admissions were close, but projected and actual staffing levels differed. Tammy noted that there is wide variance in the staffing levels at NH&C because a) NH&C is not a large hospital, and b) NH&C has committed to providing full-time employment to key employees.  The ability to adjust staffing to the daily variations in the census is limited.  Tammy said that NH&C staffs to patient needs rather than to some predetermined ratio.  The State will use the data to investigate the correlation between staffing levels and patient outcomes. 

Action Items

  1. The Board approved the minutes of the May 29, 2014 Board meeting.
  2. The Board approved the applications for Medical Staff membership.  
  3. The Board approved the purchase of Meditech Oncology Software to process and track the medications used in chemotherapy.   Chemotherapy drugs are considered “high risk” medications and the best practice is to use electronic physician order entry.  The cost is $149,150 plus a monthly service fee of $888.  The system will take 1 to 1.5 years to implement. 
  4. The Board approved the Annual Review of Government Data Practices Privacy Act, as required by law.  In response to a Board question regarding protection of patient information, it was pointed out that the Health Information Privacy Protection Act (HIPPA) mandates a very strict protocol for all patients, both children and adult, and that the staff is trained to follow the rules.
  5. The Board approved the Finance Committee recommendation to approve the Policy Statement on Auditor Selection.
  6. The Board approved the policy statement on Financial Assistance/Charity Care on the recommendation of the Finance Committee.  A Board member asked how income was defined in the statement and if it was consistent with the definition that MNSure was using.  The staff will look into the question and the issue will be discussed later.

Discussion Items


Information Items

A. Committee Reports.

  1. Community Relations—Steve O’Neill.  No additional items.
  2. Governance and Planning Committee—James Schlichting.  The Committee had a short meeting with their investment adviser.  The adviser is predicting flat interest rates for the next 12 months.
  3. Quality Committee—Gina Franklin.  The Committee met and heard a patient story and then reviewed an “event” to see what improvements may be necessary to improve the quality of patient services.  The Committee also discussed how the Dashboard measures currently monitored by the facility relate to the Strategic Initiative of NH&C.

B.  Administrative Reports.

CFO Report—Tim Gronseth.  May was a good month financially, again because the payer mix (private insurance vs. Medicare or Medicaid) was favorable.  Non- operating income (return on investments) has been favorable this year and added over $1 million to Total Income.  Year to Date, NH&C is almost $3 million ahead of budget for Total Income.  

Gronseth also did the annual review of the Attorney Generals Agreement regarding debt collection and charity care.   NH&C is in compliance.   NH&C applies the required discount for non-insured patients, and both the CFO and CEO review accounts to be sent for debt collection.  The hospital sent 3533 accounts for collection in 2013 totaling $2,839,465.  About 29% of this amount was collected, mostly through the MN Revenue Recapture program that taps state tax refunds and Social Security payments to repay governmental units in MN.  Only 3 complaints regarding debt collection were filed in 2013.   

Gronseth pointed out that Northfield is a “well insured environment” but that this may change as more employers offer high deductible health policies in response to the Affordable Care Act.  It was suggested that the Charity Care Policy approved earlier may need to be revised as the policy now excludes persons with any type of health insurance.  Often patients with high deductible policies can’t pay the deductible.    


1.  Board member CC Lindstroth called attention to the recent report from the American Academy of Pediatricians. The report stressed that mental development begins at birth, not when a child enters formal education.  Therefore parents and others need to interact with children in a meaningful way, such as reading to them, when they are very young.  Physicians dealing with children should promote early learning experiences perhaps by offering young patients an age-appropriate book and offering new parents suggestions on how to read to children.  “Physicians should look not just at the body of children but also at the mind.”  The Family Health Medical Clinics will consider the suggestion.   

2. Students from Healthfinders Collaborative programs arranged a photo exhibit at the hospital and gave a presentation on teen issues to the Medical Staff.  Underdahl reported that the presentation was well received and appreciated.

3. At a closed session after the May Board meeting, the Board reviewed the performance of CEO Steve Underdahl, and approved a Management Bonus of 17% and a Merit Increase of 2.4% for 2014.  The Board also approved a “Technical adjustment” of $20,000 effective July 1, 2014. 


  • July 4 2014 at 9:15 am
    Jane McWilliams
    Thanks, David, for your comprehensive and clear report. What would you think about having a LWV "What's Up" or other type panel (next fall) on the impact of ACA on local health providers ?
  • August 5 2014 at 12:00 pm
    Dave Emery

    I think that you have an interesting idea Jane. Perhaps we could broaden the topic to "The Impact of the ACA one year later," and include providers, insurers, the uninsured, etc. I would be willing to help organize such an event.

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