‘Critical Access’ Designation Will Boost Hospital Revenues

Gifford Medical Center last week became the second hospital in the state to earn designation as a Critical Access Hospital (CAH.)

The designation, according to Joseph Woodin, Gifford president and CEO, will bring the Randolph hospital up to $1 million annually in additional Medicare reimbursements.

Currently 36% of the patients seen at Gifford are Medicare patients. From Woodin’s perspective, this designation could not have come at a more opportune time for Gifford. Like so many other small rural hospitals throughout the country, Gifford is constantly striving to balance the actual costs for patient care versus what Medicare and Medicaid will pay.

Over the last 20 years, Congress and federal health care officials have begun to recognize that a combination of factors is placing many of the nation's rural hospitals at risk. These factors include an increasing elderly population; a shift to fewer hospitalizations and increased outpatient services; and reductions in Medicare reimbursements to rural hospitals for outpatient care.

As a response to these pressures—and in recognition of the importance of small, rural hospitals to their communities—the Critical Access Hospital program was created.

To gain CAH designation, a hospital must operate no more than 25 acute care and swing beds. With the current 20-bed Menig Unit recently re-designated as a hospital-based nursing home, Gifford easily fell within the guideline.

The CAH designation, according to Gifford Pres. Woodin, also requires hospitals to develop a network of health care providers locally and have relations with other tertiary hospitals for quality and patient transfer purposes. As a member of the Dartmouth-Hitchcock Alliance (DHA), Gifford is already part of an extensive local network of specialty providers, Woodin pointed out.

"For Gifford, the decision to go to CAH was an easy one. Our medical staff and Board of Trustees were all extremely supportive. The three-day inspection by two Vermont surveyors went very well, and we passed with high marks," said Woodin.

The CAH designation is especially important to Gifford this year, as it faces some significant cost pressures, including rising personnel and pharmaceutical costs. The $1 million in extra reimbursements for inpatient services represents a 4.6% increase to Gifford’s anticipated operating revenues of $21.5 million for the fiscal year. The extra revenues will also reduce the need to cost-shift, Woodin said.

"Gifford's ability to continue to offer high quality primary care services along with an entry point for tertiary services needed by the community," Woodin commented, "makes the Critical Access Hospital designation an important milestone for us."

GMC was the second Vermont hospital to earn the CAH designation; Grace Cottage in Townshend was the first.

Groundbreaking

Woodin also noted that ground has now been officially broken for the new outpatient center at the hospital. The center will be named the John P. Gifford Ambulatory Care Center, in memory of the nephew of Dr. Gifford, who founded the hospital in 1903.

This important redesign, on the third floor adjacent to the surgical suite, will bring together all outpatient services in an efficient and adaptable way, according to Nancy Hoggson, GMC development director. Services offered at the new center will include same-day surgery, endoscopy, and minor procedures.

Gifford’s Hematology and Oncology Clinic will also benefit from the redesign. A significant increase in the number of clinic patients has created a need for an expanded space that is more comfortable for patients, as well as their families.

The chemotherapy suite, which will be part of the new Hematology and Oncology Clinic, will be named in memory of Nancy Fratkin, former President of the Gifford Auxiliary and a long-time hospital volunteer.

When the renovations are completed early this fall, Gifford’s Diabetes and Anti-Coagulation Clinics will also move to the new ambulatory care unit.

"This is all part of our commitment to meet the health care needs of all the communities we serve in the White River Valley and sets the stage for our continued success," concluded Woodin.