2005-03-16 / Front Page

Hospital’s $21 Million Budget Adopted; Millage Campaign Continues

A $21 million budget was adopted for Mackinac Straits Hospital and Health Center Monday, March 14, reflecting about a $1 million increase over this year’s budget, which will expire March 31. The new budget anticipates that general expenses will increase about three percent, wages will increase about 3.5 percent, and insurance costs will climb about 10 percent. This will be offset by a 3.5 percent increase in acute care and clinic charges and a five percent growth in outpatient care. In addition, the facility will see some savings by no longer offering a prompt pay discount for private pay residents in the long term care unit, and it hopes to generate about $100,000 by offering speech therapy in St. Ignace, for which it will contract with War Memorial Hospital. Long term care fees will not be increased.

Speech therapy will be the only new service to be offered by the hospital next year, said hospital CEO Rod Nelson.

Wage increases at the facility will average about 3.5 percent, said Jason Anderson, the hospital’s accountant, with most of the staff seeing about three percent and registered nurses getting a little more, in line with their skill level and increased demand, as their numbers dwindle.

Nurses at nearby hospitals in Cheboygan and Petoskey, said Mr. Nelson, will be seeing increases up to five percent. A shortage of nurses, he said, is expected to peak around 2008 as more nurses approach retirement age.

The hospital board learned that Mackinac Straits nurses did not ratify their new contract in a vote taken March 14. The hospital administration will not know what issues there are until the nurses meet again March 23, said Karen Cheeseman, the human resources director.

Among the items under consideration in the new RN contracts are wages and a higher deductible for medical insurance, in line with what other hospital employees are getting.

Employee health insurance costs are expected to rise about 10 percent, even though the hospital is covered under a discount program that Michigan Blue Cross offers in the Upper Peninsula, mostly, Mr. Nelson said, for facilities on the west end of the Upper Peninsula to keep them from seeking health insurance in Wisconsin.

On a high note, the hospital will save between $50,000 and $100,000 on its new workers compensation policy with the Accident Fund, a subsidiary of Blue Cross. The hospital was being forced into a state insurance pool by its former underwriter, in part because of last November’s millage failure, but former State Senator John Kelly was able to steer the hospital over to the Accident Fund through his contact with the CEO there, Mr. Nelson said.

Mr. Kelly has been helping the hospital administration look at funding opportunities for a planned new facility.

The hospital anticipates it will receive about $200,000 less in Medicaid payments from the state in the new fiscal year, but won’t know the exact amount until the state budget is finalized, probably in late summer. Mr. Nelson said a Medicaid cut of about four percent is being considered.

“I think this was one of the easier budgets to put together compared to the last five years,” said Mr. Nelson, “because we’re not anticipating any new things coming on board,” and the hospital has a good history of its operations.

Of the $21 million in anticipated revenues, $14.35 million will come from the acute care division, including emergency room services, $6.15 million will come from the Long Term Care Facility, and $500,000 will come from the Mackinac Island Medical Center. Losses of about $180,000 on Mackinac Island will be made up from annual fundraising drives on the Island. A county-wide tax of 1.2 mills will support programs at the St. Ignace facility. The millage will raise close to $900,000.

Voters will decide the fate of the millage Tuesday, May 3, and the hospital is conducting a more active campaign this time, after suffering a loss in the November election.

Mr. Nelson said the millage has received seven endorsements so far, from Mackinac Straits Hospital Auxiliary, Mackinac Island City Council, Helen Newberry Joy Hospital and War Memorial Hospital boards, and the boards at Moran Township, Bois Blanc Township, and St. Ignace Township.

He and several board members attended three meetings last week to promote the millage, at Portage Township, Marquette Township, and Bois Blanc Township.

Coming up will be a meeting with Clark Township Thursday, March 17, at 7 p.m. Clark Township is significant, said Mr. Nelson, because it had the highest voter turnout in the November election, with 1,260 voters, beating even the City of St. Ignace, and rejecting the millage by 124 votes. County-wide, the millage was defeated by 392 votes.

Other boards to be visited are the city council at St. Ignace March 21, Hendricks Township March 30, Brevort Township April 5, Hudson Township April 7, Newton Township 13, St. Ignace Township April 14, and Garfield Township April 18.

In addition, the Hospital Auxiliary mailed letters to more than 4,000 households in St. Ignace and nearby townships, promoting the ballot issue with answers to common questions about the millage and hospital operations. Another mailing will go out to outlying townships later in April.

The hospital stresses that the millage subsidizes medial operations that benefit all county residents, and cannot be used for the new hospital complex being planned on North State Street near the Mackinac County Airport. The millage was first approved by voters in 1989 and has been renewed at five year intervals until last November, when voters rejected it, requiring a new vote in May.

In news related to the new hospital, Mr. Nelson told the board that appropriation and grant requests have been made to the offices of U.S. Congressman Bart Stupak and Senators Debbie Stabenow and Carl Levin for $28 million, and also a request for a $30 million loan guarantee, although he said the hospital will be lucky to get between $1 million and $3 million just in grants this year.

Former Michigan Community Health Director Jim Haveman is leading an effort to identify and secure funding for the new facility, estimated to cost about $33 Million.

The board reelected its current officers, Ron Mitchell as chairman, Richard Smith as vice chair, Peter Della-Moretta as treasurer, and Kathy Lawnichak as secretary.

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