Pagosa Mountain Hospital — from dream to anniversary

Within a week, the Pagosa Mountain Hospital (PMH) will quietly observe its first anniversary.

In the 12 months since its opening on Jan. 7, it has attended to some 5,700 patients during 9,600 total visits, been the site for three minor surgical procedures, established service contracts with more than a hundred insurance providers, and achieved Critical Access Hospital designation.

Attaining such standing hasn’t been easy.

In March 2005, following years of financial turmoil and mismanagement, a new Upper San Juan Health Service District Board of Directors was forced to close the Dr. Mary Fisher Medical Center. At about the same time, director Dick Blide’s earlier idea of bringing a Critical Access Hospital to Pagosa Springs took on a more serious tone.

As hospital plans slowly took shape, Prochaska & Associates (Omaha, Neb.) began developing engineering and architectural designs, and G.E. Johnson Construction Company, Inc. (Denver and Colorado Springs) prepared initial construction cost estimates and timelines. Cost estimates placed architectural expenses at $600,000, hospital construction at $8 million (with a 5-percent contingency), equipment purchases at $750,000, and working capital at $1.8 million.

In early 2006, four prominent area families agreed to collectively match all contributions to the district’s Our Mountain Hospital Campaign up to $500,000.

Meanwhile, members of the USJHSD board and fund-raising committee personally contributed a combined $102,000 toward the hospital and launched its Summit Leadership Challenge, encouraging other citizens and businesses to contribute. While having left the area due to health reasons, Blide also contributed $10,000 to the project.

In May 2006, district voters approved Ballot Issue 1A by a wide margin (93 percent), allowing the district to increase debt by $12 million for hospital construction. Later that month, the district selected United Missouri Bank Financial Institution of Kansas City, Mo. (UMB) as its lender, and agreed to its sale of limited tax bonds. Actual funding would come in two installments.

Soon thereafter, contracts were approved with G.E. Johnson and Cooper Medical Consulting for pre-construction and equipment consultations.

By July 2006, the fund-raising committee had accomplished its goal of raising $1 million in private donations, as the district board agreed upon a specific building design. UMB then prepared financial documents and set a “not to exceed” cost of $9.89 million.

A huge crowd attended the official ground-breaking on Sept. 5. By October, as extensive earth work commenced, plans for a 36,500 square-foot facility — including the adjoining 8,500 square-foot Dr. Mary Fisher Medical Center — neared completion. UMB sold the limited tax revenue bonds on the open market and closed the district loan.

In November 2006, voters relieved the district of TABOR constraints, as the district received its first financing installment of $9.89 million. Its fund-raising committee, meanwhile, obtained a $500,000 grant from the Department of Local Affairs (DOLA) for hospital equipment purchases, and G.E. Johnson submitted a final construction bid within the district’s hospital budget.

In January 2007, UMB extended the district another $2.11 million (as its second loan installment), as workers completed earth work and poured concrete footers. The following month, the district received one of the largest Caring For Colorado Foundation grants ever offered. The $200,000 was applied to the purchase of a four-slice CT Scanner from Mercy Regional Medical Center in Durango.

By June, after two previous hospital CEO candidates suddenly backed away from district employment offers, Daniel Boatman agreed to serve as the facility’s first CEO. Assuming duties the following month, he suggested an opening date of Jan. 7, 2008.

In the next several months, the hospital building took shape, staff positions were filled, diagnostic equipment was installed and tested, and the district approved its first-ever hospital budget. Dr. Robert Bricca was named hospital chief of staff.

Following more than two years of studies, a bond election, architectural design, planning, and fund-raising — never mind 14 months of actual construction — PMH opened on schedule and on budget. Four months later, CEO Boatman resigned for personal reasons, and was soon replaced by current CEO Brad Cochennet.

IN its first 12 months, the hospital staff has cared for an estimated 150 inpatients, or those admitted for at least one overnight stay. Though the 10-inpatient-per-month average was below initial expectations, the facility now accommodates swing-bed patients, or patients spending one or more nights in the hospital, after spending at least three midnight stays at an acute care facility, such as Mercy.

In most cases, swing-bed patients are recovering from specialized treatment or surgical procedures received elsewhere, but still require continued attention and monitoring. Often, patients simply want to be closer to home, or the initial facility needs space for more serious cases.

Of PMH’s approximate 9,600 total visits so far, 5,700 were individual patients utilizing the various medical services PMH provides. Among them, many passed through the Emergency Room with acute illness or injuries, while several called on radiology or the lab for assorted tests and evaluations.

Though PMH has no plans for a birthing center, medical practitioners have attended two emergency births. They have now performed three minor surgical procedures in one of two surgical suites, and have completed training in preparation for the possibility of an unforeseen flu pandemic. With two recent Colorado Rural Health grants totaling $15,000, the hospital has also purchased specific supplies to handle a flu outbreak, should one occur.

Shortly after Cochennet took over as CEO, he negotiated a management contract with Mercy Regional Medical Center — something certain district board members had increasingly considered in recent months.

By doing so, PMH now taps into Mercy’s broader experience and wide-ranging resources, thereby avoiding costly mistakes. Because several PMH patients are eventually transferred to Mercy for advanced care, an enhanced relationship between the two provides superior services, overall.

As part of the arrangement, Mercy immediately hired a district financial director to work at PMH for an initial three-year period. As the director reports to the district board, Mercy provides necessary training, counsel and oversight. The district reimburses Mercy for all costs, plus 10 percent, and may renew the agreement up to four times, before renegotiating terms.

Mercy also provides assistance in billing, maintaining medical records, physician and staff credentialing (including regular file review and updating continuing education), and overseeing quality measurement and management in all departments. To expedite diagnostic turnaround, Mercy now reads all PMH radiology exams.

Even as PMH worked to establish service contracts with most healthcare insurance providers, the USJHSD, Cochennet and staff worked diligently toward attaining designation as a Critical Access Hospital (CAH).

Such facilities actually improve access to rural health care, while reducing the likelihood of hospital closures. By receiving reasonable cost-based reimbursement from Medicare for services provided to Medicare patients, they improve financial performance.

In fact, the federal government — through Medicare — typically reimburses facilities 101 percent of Medicare inpatient and outpatient expenses. Medicaid (state) also offers reimbursements, while other fees are negotiated or considered charity care.

CAH certification comes through a more flexible set of Medicare “Conditions of Participation” than Acute Care Hospitals. To become a Critical Access Hospital, a facility must first be licensed as an Acute Care Hospital, be 35 miles from another facility (15 miles in mountain terrain or areas with only secondary roads), and keep patients only up to 96 hours. Critical Access Hospitals have a maximum of 25 acute care beds, with any number used as acute care or swing beds (long-term care).

CAH staffing requirements are also more flexible. A physician must be available 24 hours a day, seven days a week, but doesn’t necessarily have to remain on site. He or she must be within 20 minutes of the facility though, and mid-level practitioners and nurses are allowed to provide direct service to patients.

After many months of delays and frustration, PMH finally achieved the CAH designation, Sept. 15. On Dec. 15, with all forms completed and everything in place, PMH began billing at the higher reimbursement rate afforded Critical Access hospitals.

Typical of most medical facilities, PMH is continually growing and developing. A physician’s assistant has recently joined staff, and a yearlong contract with Southwest Emergency Physicians now provides additional ER doctors to fill the many on-call shifts throughout each week. At last report, Cochennet is still negotiating with various physicians to bring additional specialized surgeries to PMH.

By the end of March 2009, PMH hopes to have a new $500,000 digital x-ray system and an $80,000 Pyxis drug dispensing machine installed. The x-ray system will complete the hospital x-ray suite, while the Pyxis system will enable greater security and more efficient dispensation of controlled medications.

Certainly, the costs of adding medical services and supplies are quite high and continuous. Through the district’s fund-raising committee and the Dr. Mary Fisher Medical Foundation — a non-profit organization that assists, benefits and supports the USJHSD with funding for healthcare programs and initiatives — grants and donations are constantly solicited and graciously accepted.

Many kind folks have donated significant time, services and sums of money to PMH since its inception. As a result, Pagosa Springs and surrounding communities now have a fine Critical Access Hospital that greatly enhances the local healthcare system.

With ongoing support, the range of quality medical services provided by PMH will continually expand. The Foundation happily receives and manages benevolent hospital gifts, and prospective donors can contact it by visiting the hospital at 95 S. Pagosa Blvd., Pagosa Springs, or by calling the foundation at 731-9545.

In the meantime, we bid you happy first anniversary, Pagosa Mountain Hospital.

SUN photos/Chuck McGuire
The snow might be piled high at the entrance of Pagosa Mountain Hospital, but it is business as usual for the staff. From left are Chief of Staff Dr. Robert Bricca, EMT Sue Saunders, and RN Diane Aaberg. The hospital celebrates its first anniversary Jan. 7.