The main presentation was by Mr. Jeff Halloin, former Board member with Hospital Sisters Health System (HSHS) in Eau Claire WI. The System operated two hospitals, one in Eau Claire and one in Chippewa Falls and employed over 14,000 people with $1.5 billion dollars of revenue in 2022. HSHS no longer operates the hospitals. There-in lies the story and maybe the lessons.
The goal of HSHS was to serve the health needs of the communities: a seemingly reasonable goal for a religiously based non profit provider. But . . . . it allows your competitors to skim off the profitable procedures (predatory competition) leaving HSHS with no path to financial survival. Mayo and Marshfield Health entered the market. Surgeons started their own hospital. Financial cushions disappeared from the health market with the new competition. “No margin no mission.” Other providers could see what was happening, but nobody was willing to change. “Nobody is going to care about you as much as you care about you.” Halloin”s advice to the Board:
- Understand what you are up against in your market.
- Put survival as your number one goal.
3. Be willing to do the hard things that are necessary to survive.
(This was an excellent but sobering presentation. I hope some city officials heard it.)
CEO REPORT: Steve Underdahl.
- Jerry Ehn, COO, is retiring. The Board thanked him for his service.
- NH&C is joining with a number of other rural hospitals into a high value network,
- Work is underway on updating the digital health system at NH&C.
- Podiatry services will be offered beginning Sept.1.
- Tareen Dermatology will begin providing services at the Farmington clinic.
CFO Report: Eric Guth
Net Revenue for May was $1.5 million below budget. The operating loss for May was $900,000. Investments were up $1 million. The net cash-flow was -$5 million due to an increase in Accounts Receivable.
The public meeting adjourned at 7:00 p.m. and the Board continued in a closed session.
Observer Report: Northfield HOspital & Clinics, 6.26.24
