Meeting Tuesday to discuss hospital district, tax

On June 21, the Hot Springs County Commissioners will host a public hearing regarding the formation of a hospital district, which will provide operating revenue for Hot Springs County Memorial Hospital, and the Specific Purpose Sales and Use Excise Tax, which will go toward remodeling and adding on to the hospital building.

The Thermopolis Independent Record is providing information from those who support the tax and the district formation, as well as those opposed to it.

Vote yes supporters

Karen Sinclair said the June 21 hearing would be “the beginning of the beginning,” as the commissioners are not making a decision on the district or the tax; rather, they are deciding whether these items will be on the ballot for the people to decide. She is hopeful the commissioners will let the people decide.

“I do believe this decision is about the future of our community,” Sinclair said, noting there is now the opportunity to keep a medical community with quality medical professionals, which she is worried of losing.

As a businessperson, Sinclair said she sees the connections of economic value and health. “You have medical health that we’re asking our community to support, local medical health within our community, and economic health for our community.” She further noted the hospital employs about 100 people, and if services are lost because the community doesn’t support the hospital through taxes, there isn’t going to be a group or a governmental entity that’s going to come in and save us; that idea has already been investigated by the hospital board.

“There’s nobody on a white horse coming to save us. We need to save ourselves. We need to save our healthcare in our community.” She added it’s not a new idea to use tax dollars to help the hospital, but the district would provide a more stable funding source.

Businesspeople also see, Sinclair said, not only the jobs created for people who live here and work at the hospital, but people who come from outside the county to see their doctor(s) here and utilize the facility, or to simply visit a patient.

“I don’t think people understand how many people are actually using the hospital.”

The hospital was built in the 1950s, for 50s-style medicine, Sinclair said, but today that style of medicine is different and the building is no longer set up for it. The hospital board has tried hard to listen to the community in keeping the hospital in its same location, rather than moving it entirely.

Spending local taxes for a local thing can be good, Sinclair said, and when the people are controlling their destiny by giving a little money “it’s not a big hardship.” She further pointed out the money people will pay in taxes would be less than the cost of gas it would take to travel to a different hospital.

As for the Specific Purpose Sales and Use Excise Tax, Sinclair said she thinks it is a fair tax. Not only will people locally in our community — who support our community by shopping locally — support it, but also tourists who come to town and buy products or use medical services if they need.

“I like to keep our tax dollars as close to home as we can . . . I’m not in favor of turning it over to a big company [such as Banner] to decide what we’re going to have for medical in our community.”

The hospital would lose the majority of services, and the jobs they provide if Banner were to come in, Sinclair said, as Banner would do what is good for their big business, not for our small community.

The county has some amazing physicians, and Sinclair believes the people can provide the support so they can continue to stay here. “I want that to happen. I don’t want to give up some of those services . . . I’m afraid our physicians will leave. I’m afraid they won’t want to practice where we can’t practice the kind of medicine they want.”

It’s hard to know exactly how many jobs would be lost, Sinclair said, but without the community support it might be all of them. She later said it wouldn’t happen overnight, but it would happen.

“I think it would be devastating to our community, to lose the medical services that are here now if we can’t support it with these two initiatives. It’s us helping us.”

Steth Daniels said from his perspective it is about investing in the community. “It’s something I don’t think we can go without. We can’t not have the hospital.” He further added when the economic factors of being a self-sufficient community are broken down, the hospital is a big part of allowing the community to remain steady without a lot of economic ups and downs.

“We have to invest in ourselves,” Daniels said, “and having that hospital and taking care of it is just part of that.”

Bill Williams noted 60 years ago the federal government supplied funding for the hospital. “They have different priorities then. Now they like to go blow stuff up in foreign countries instead of providing for infrastructure for their citizens.”

Williams noted healthcare has changed drastically in the past 15 years in terms of Medicare and insurance reimbursements. Since the last crash in 2008, he said, there are a lot more folks without insurance, and reimbursements are less. The hospital, he noted, is probably 55-60 percent Medicaid reimbursements.

At the same time, expectations are increasing. It makes for a pretty slim margin when regulations and costs continue going up and reimbursements are going down, Williams said, “and it can’t continue forever.”

If the tax and district make the ballot but don’t pass in November, Williams said it looks pretty gloomy. While the hospital wouldn’t close the day after the election, he said, doctors have stated very publicly that if they don’t have a hospital to fully practice their medicine they will probably have to practice somewhere else.

“We lose our docs, and we’re done.”

As for alternative funding outside the district and the tax, Williams said there have been discussions with neighboring hospitals in the region, and many are facing similar financial challenges, particularly with regard to reimbursements. Banner Health has been a suggested source, but Williams pointed out various people have spoken to Banner out nobody has presented a proposal to build a new hospital.

Banner has no economic reason to build a new hospital 30 miles away from where they are already building one, Williams said, but they would love to have Thermopolis’ patients and doctors.

Regarding the total $16.4 million price tag on the hospital and renovation, Williams emphasized that includes the interest.

Another positive to the initiatives, Daniels said, is it allows the maintaining of local control by having a local hospital board. “I think that’s something that seems very important to people, to have local control for things that are going on in our county. The way I understand it, we would lose that if somebody like Banner came in. I think its just another positive about investing in the community.”

Williams added if they received money from another entity, that entity would want “a seat at the table,” possibly a controlling one depending on how much they invested.

“I think what makes our hospital unique,” Williams said, “is we have a working relationship with our physicians that is probably the envy of many others, because a hospital and a group of doctors who are independent businessmen rather than employed physicians, they provide stability to their practice, stability to their patients, and their presence provides stability to our hospital.” Having an updated facility, he noted, provides stability for the physicians and increases ability to recruit specialists.

Citizens for

common sense

From the other perspective on the possible ballot initiatives, Citizens for Common Sense Healthcare Political Action Committee (PAC) Chair Harry Hughes emphasized the PAC supports a new or rehabilitated healthcare facility that meets the needs of the community and that the community can afford.

“All of our thinking derives from that,” Hughes said.

Dee Hillberry, secretary of the PAC, further noted there seems to be a perception that the PAC is against the hospital; rather they support healthcare for the community.

Hughes said the PAC strongly opposes creation of a hospital district for several reasons. First of all, he noted, in the current economy the district will only generate $400,000 annually. To put that in perspective, he said, the net annual revenue for the hospital is approximately $15 million and “$400,000 is nothing more than a band-aid.” He further added the $400,000 could be accomplished through proper management and cost control.

Joe Casciato said one fact is the company that currently manages the hospital, Health Tech, takes about $600,000 for management and billing.

Hughes noted, without getting into specifics, $400,000 on $15 million is 2.6 percent. “There isn’t a business around that can’t cut 2.6 percent.” Hillberry added typically businesses can find five or six percent to take out.

Another point Hughes addressed is once the district is created it will be with us forever. “It will affect our children, our grandchildren and beyond.”

Local tax districts are the most abused form of taxation in the United States today, Hughes said. Casciato added it puts a permanent liability on every property in the county.

Hillberry said until fairly recently a district could not even be put on a ballot for taxes without at least 25 percent of the assessed value agreeing to it. The law was changed, he noted, and where we are now could be interpreted as taxation without representation.

“Many of the people that will vote for this who perceive they aren’t going to pay this,” Hillberry said, “it will trickle down through rent increases, product increases and so forth.”

Also with regard to the creation of a hospital district, Hughes said it is simply the wrong time for consideration of any new taxes. He further explained the assessed value of the county is down and local businesses are suffering. Examples he noted include R & S Well Service cutting staff 60 percent, Gas Ventures eliminating all but one staff member and Merit Energy shutting down 32 wells.

Hughes further explained most of the wells in the county are on federal land. State and local governments can’t tax the federal government, of course, but the wells are taxed on production. That ad valorem tax from the oil production in the county comprises a majority percent of the total revenue for the county, Casciato said.

“It’s just not the right time to ask the voters for more tax, in the current economy,” Hughes said.

Casciato said the district is meant to provide operational revenue for the hospital, but he feels it is not appropriate as the hospital is operating in the black.

As for the Specific Purpose Sales and Use Excise Tax, Hughes said the PAC can support that in the future, based upon a thorough vetting and analysis of all business models available to provide healthcare in the county, in a collaborative way.

“Quite simply, that means we need to be at the table, and that has not happened.” Hughes said the County Commissioners put the hospital district issue on the ballot, and the voters defeated that, 57 percent to 43.

Hillberry said, “Fifty-seven percent of your community has not been a part of what they’re trying to do by imposing taxation, haven’t been a part of analyzing various alternate management models and structures.”

Hughes said the PAC has met with SageWest, which manages healthcare in Fremont County, Banner Health in Worland and Billings Clinic, and executives from all three entities have advised when a community is divided its imperative both sides are involved in developing a solution.

The PAC, Hughes said, has made such a request to the hospital board and has been rejected.

Also with regard to the tax, Hughes said if it gets placed on the ballot at some point in time after alternatives have been analyzed, the PAC supports it being for a fixed amount of money, for a specific purpose, and no longer being collected after that.

The understanding, Hughes said, is the request of the hospital board to the commissioners is to raise $16.4 million with the tax, which is the architect’s estimate of the capital cost for the proposed new facility. However, he said, information has never been disclosed about the interest, which could raise the total costs to closer to $30 million.

Hillberry noted the one-cent sales tax would generate $900,000 per year, meaning it would be quite the challenge to fully pay off the project. He further called for more transparency of the board to the community.

The PAC wants a transparent and collaborative evaluation of all healthcare alternatives for the county, Hughes said, and further wants the results reported to the community. “That’s the transparent part. The collaborative part is we need to be at the table. It’s really quite simple.”

Hillberry added, “We need to look forward on a healthcare model that moves us into the 21st century. We need to look at how can we reduce the cost to you and your family.” He elaborated patients often first go to a clinic, but then could get admitted to the hospital for further tests, and bills keep accumulating.

“Most of the states now are moving to one-stop shopping,” Hillberry said, “where you go in to a care facility and right there they have an X-ray, right there they can do some blood work and give you a prescription. We need to take the cost out of healthcare, not only in Hot Springs County but nationwide.”

Hillberry further noted this is not the first master plan generated at a cost to the county, though it is the least attractive, and he called for people to stop doing the same thing over and over and expecting different results.

Casciato said the only way to get a consensus in the community is to bring all the players to the table. Hillberry said the transparent, collaborative effort should be led by an unbiased third party, also collaboratively chosen.

“I believe we have a huge opportunity here,” Hillberry said, “to bring our community together, to get good healthcare, but we’ve got to quit trying to feed the egos of a small group of people. We’ve got to make it healthcare for the people of the community, not just a select, small group.”