1. Acting Board Chair, Charlie Mandile, called the meeting to order at 6:30 p.m. The Agenda was approved. Charlie stated that he had met with each of the Board members regarding the structure and content of future Board meetings, and the committee preferences of the member.
2. Two new Board members were introduced, along with the new Liaison for the City Council. Lynn Clayton, a resident of Northfield, has 35 years of experience in health care administration at small hospitals. Patricia Christianson, a resident of Bridgewater Township has 30 years of experience in a variety of health care settings. Councilperson Brad Ness, is the new Council Liaison. Brad stated that he is a lifetime resident of Northfield, having been born in the old Northfield Hospital.
1. Hospital Chief of Staff—Dr. Reister. Reister asked for approval of the applications for Medical Staff membership and privileges. Motion approved.
2. Family Health Clinic—Dr. Flannery. Flannery reported that the clinics had a good month and a good year. Clinic visits were at an all time high. The clinic providers were optimistic about the direction of the clinics. The 1,2,3 Read program distributed 700 books to pediatric patients in 2016. The pediatricians are adding a new reading program for 2017, Reach Out and Read.
3. Chief Medical Officer—Dr. Meland. Meland reported that the respiratory therapists are now staffing the facility 12 hours per day, 7 days per week. A series of meetings were held with therapists, ER physicians, and hospitalists to help integrate the therapists into the facility. The meetings were very successful, and more will be held to promote conversations among the various providers.
4. Allina Clinic—Dr. Olson. A major renovation on the primary care facilities in Northfield has been completed. Allina has launched an initiative to improve the handling of mental health patients including handoffs from their clinics to mental health facilities.
5. Mayo Health—Chris Rustad. Rustad reported that Mayo has shifted Dr. Whitehead to the River Clinics in SE Minnesota, and a new medical liaison will be appointed for NH&C. Mayo will be sharing the results of their Critical Care Initiative and increased use of electronic monitoring in ICUs with the Northfield medical community. The program has lowered mortality and nursing turnover in Mayo facilities.
6. City Business—Brad Ness. Ness reported that as a new Council member, he was here to listen today.
7. Financial Report—Scott Edin. Edin reported that Dec. was a busy month, with good financial results. However, the shortfalls in the public employees retirement plan (PERA) resulted in an additional $21 million liability for NH&C in 2016. Accounting rules (GASB 68) required an additional expense in 2016 of $4.3 million to amortize the liability. The $4.3 million is a non-cash expense, but it reduces the Net Income for 2016 by $4.3 million to about $1.6 million. The reduction will not affect the credit rating of NH&C nor its cash position, but it does jeopardize the employee bonus program for 2016. An extensive discussion followed regarding the bonus program. It was noted that the PERA adjustment was not a result of anything that happened at NH&C; the PERA adjustments are semi-random and will continue in the future; the liability did not involve the payout of any cash; and that employees at NH&C had “hit it out of the park” in achieving all of the goals set for the employee bonus program for 2016. Therefore several Board members said it doesn’t seem fair to penalize employees under the circumstances. A counter argument was made that the financial results are what they are and that the earnings’ threshold in current Board policy did not permit employee bonuses. No formal action will be taken until the February meeting. Several Board members expressed strong support for the bonus program. The Board asked the Administration to explore alternatives to PERA and/or some way to form alliances that will improve PERA performance or change accounting rules.
8. Strategic Planning—Steve Underdahl. NH&C is preparing for a new 3-year Strategic Planning Cycle and Underdahl reviewed the progress made in the current cycle. There were 5 goals set for the current planning cycle, and many tactics. The 5 goals were:
- Remain independent
- Assess and strengthen partner relationships
- Strengthen the clinic practices
- Modernize the medical infrastructure
- Strengthen marketing and branding
Underdahl then reviewed a long list of achievements during the past 3 years, including improved relationship with the Allina Clinic, modernizing the HR department, creating a supply chain program, creating the “Do the next right thing” program, etc. Underdahl gave himself a grade of A- on the results. In response he said the minus was from his Scandinavian, Lutheran background—no one is perfect. Underdahl asked the Board to consider what elements of the current plan need to move forward into the new plan, and should the current strategic planning structure carry forward?
9. Governance and Planning—Charlie Mandile. The committee nominated Charlie Mandile to be Board Chair and Virginia Kaczmarek to be Vice Chair for 2017. Moved and passed. A sheet listing committee assignments for 2017 was distributed. Board members were asked to review their assignments and to contact Mandile if they were dissatisfied. Committee membership will be put to a vote of approval in February. The committee moved approval of the CEO Evaluation process described at the December meeting. Mr. Walt Flynn will be hired as a consultant to conduct the 360-degree evaluation survey and to investigate market conditions for CEOs. Salary adjustments will be based on market data plus results of the 360-survey. Any bonus will be based upon achievement of strategic priorities. Motion passed.
10. CFO—Jerry Ehn. Ehn reported that the brand refreshment project will move forward with an expenditure of $200,000 to redo all of the signage within the NH&C system. The expenditure was included in the 2017 budget.
The consent agenda was passed after one item was removed. Items on the agenda included: Minutes for the December Board meeting, a meeting of the Budget and Finance Committee and a meeting of the Quality Assurance Committee, and a revision of the Complaint and Grievance Process Policy. Revision of the Donation to Non-Profit Organizations Policy was then passed with 2 Board members abstaining due to potential conflicts of interest.
1. Electronic Medical Records –Scott Edin. NH&C is working with Xerox consulting to select a new EMR provider. Three vendors are under consideration: Meditech, Allina/Epic, and Athena Health. There are perceived weaknesses with all three vendors, and large costs--$10 to $12 million over 5 years. An additional option would be to retain the present Meditech system for another 20 months, hoping some of the perceived problems in the new systems are resolved. A preliminary decision could come in March or April, and a final decision in May. A Board member urged Edin to give careful attention to security issues for a new system.
2. Senior Services—Jerry Ehn. Ehn reviewed the plans for new senior service facilities including an enhanced care unit, memory care beds, an independent living unit in conjunction with St. Olaf College, and more technology in the homes of seniors. Yanik Companies would be the developer. The Benediction Health System would operate the new facilities. The existing SNF (Dilley Unit) would be phased out and the space used to expand the Women’s Health Center. Ehn asked the Board to approve a “Letter of Intent” from NH&C to Yanik Companies. The letter does not formally commit NH&C to the project, but will facilitate Yanik taking the next steps in the project. Extensive discussion followed. It was noted that NH&C will not directly gain revenue from the project, but the changes will eliminate the current subsidy to the Dilley Unit, and the expansion of the Women’s Health Center is expected to generate revenue. A motion to approve issuing a letter of intent was passed.
The meeting adjourned at 9:30 p.m.
Next meeting: February 24, 2017