The autumn chill was just starting to be felt late last September when employees at Down East Community Hospital in Machias, Maine, were celebrating at their annual picnic.
There were many reasons for smiles: The hospital was completing another profitable year, it recently had finished a successful $650,000 capital campaign, and the new chief executive officer-Richard "Ric" Hanley-seemed friendly and open to new ideas.
The celebration also offered a pleasant surprise.
"I looked up and there she was," Hanley said. "My mouth dropped."
The "she" was Carolyn Foster, president of the hospital's board of trustees.
Despite having undergone major orthopedic surgery on an arthritic hand just a few days earlier, Foster was determined to attend the shindig.
"It's not that Carol was wheelchair-bound, but it just shows that, for her, the hospital, its patients and employees come first," Hanley said.
But some longtime Down East staffers knew it would take more than surgery for Foster to miss a hospital event.
"If she was able to be upright, we knew she'd be there," said Lois Macias, Down East's director of support services and a 10-year employee of the 38-bed facility.
It's that kind of dedication that helped earn Foster MODERN HEALTHCARE's Trustee of the Year award for hospitals and healthcare systems with fewer than 200 beds or revenues of less than $25 million.
"I think it's really important for a hospital board and its members to be visible to employees, patients and the administration," Foster said.
A member of Down East's board since 1988, Foster has served as president for the past four years. She retired in 1990 as a vice president of Machias Savings Bank.
Active retirement. The 55-year-old Foster could choose to spend all her time in retirement as a church-going grandmother, but she keeps active on the hospital board because "it keeps me sharp and educated in more ways than you can possibly imagine." She added that "if one of my children is concerned about a sick grandchild, I can reassure them of the kind of healthcare they are going to get."
But healthcare first became an important part of Foster's life shortly before she moved to Machias in 1984. Her father had been sick and was "in and out of hospitals" for many years.
Her stepson also had been in a serious car accident in 1981, and the Down East physicians and staff helped save his life. She and her husband, Robert Foster, have three children each from previous marriages and nine grandchildren.
"People looked at the hospital as just a stopover," Foster said. "But I knew it was more than that. That hospital is the only game in town out in a rural area like this."
Machias is a rural community of nearly 1,800 people that relies on its healthcare system and a good blueberry harvest to maintain a strong local economy. Down East is the largest employer in the area, with 162 full-time employees, ranking just ahead of Maine Wild Blueberry Co., which has 115 employees year-round and 250 during the busy harvest season.
In 1988, Foster was approached to serve on the hospital board. "About that time, all I did was church and my job," said Foster, an active member of the Hammond Street Congregational Church in Bangor, some 90 miles away. Little did she know that she was in for an education and some tough decisions.
Years of struggle. The hospital had been suffering financially before 1988. For example, in 1986, it lost nearly $350,000 on $4.5 million in net operating revenues, and in 1987 lost $74,000 on $4.8 million in net revenues.
In her first year on the board, the hospital hired Brentwood, Tenn.-based Quorum Health Group to provide management services. "It was a big step to go with an outside management company," Foster said. "And it was an important decision for the board. With a lot of folks around here, you get only one chance to make a good impression."
The move proved successful. The hospital has been profitable every year since Quorum came on board.
Quorum provides the chief executive officer and chief financial officer to the hospital in return for annual management fees of about $150,000.
Down East also gets access to Quorum's purchasing power, as well as consulting and educational support from its national network of mostly rural hospitals.
In 1994, Down East posted net income of $222,328 on net revenues of $10.2 million, according to HCIA, a Baltimore-based healthcare information company. The hospital has $7.7 million in assets.
As a board activist, Foster has spearheaded a number of projects to help the hospital remain financially healthy. For example, she launched a capital campaign in 1991 that raised more than $650,000 to build a four-bed specialty-care unit. The goal of the four-year campaign was $500,000.
The results were particularly impressive because 500 donors were from one of the most economically disadvantaged areas in Maine. In 1993, Washington County's median household income was among the poorest at $22,850 per household, compared with $32,155 for the state and $34,103 nationally.
Foster's fund-raising skills also are used each year when she heads up the hospital's "Light A Life" program. Created in 1988, the program has raised more than $40,000 through $5 donations used to buy Christmas lights for the tree outside the hospital. The money raised is directed to a different patient-care program every year.
Serving the community. The importance of serving the needs of the diverse community also has helped hone Foster's leadership skills.
"In this part of the country, people are quite outspoken and parochial in their concerns," said Hanley, a native of Augusta, Maine, a "big city" by Machias standards.
In addition to Machias, Down East serves 16 other towns, and its board reflects that by having 17 members drawn from throughout its market. At times it can be difficult to address the concerns and priorities of all board members and their localities.
"Communication is the key," Foster said. "As a board, we'd rather hear about problems from (the CEO) than down at the `Shop-N-Save.'*"
Foster has taken steps to ensure that board members stay on top of community issues and healthcare needs through regular educational seminars. New board members attend monthly educational meetings in addition to periodic seminars sponsored by Quorum and the Maine Hospital Association.
"Carol has such fervor and is incredibly intense in what she does," Hanley said. "She can move from showing empathy for patients to rallying the board on a legislative issue."
Foster's leadership efforts paid off last year when rural Maine hospitals and their boards successfully lobbied against a drastic change in the state's "tax and match" program. It requires hospitals to pay a 6% tax on gross patient service revenues, with the proceeds going to a pool used to obtain matching funds from the federal Medicaid program.
However, the state wanted to continue the tax without continuing the same level of hospital funding. The original formula proposed by the state would have made Down East liable for $410,000 for this year, but the final recommendation is for $123,000. "It was a statewide effort by the Maine Hospital Association, and Carol was very involved in that," Hanley said.
"We wrote a lot of letters and made a lot of phone calls," Foster said, an effort that's expected to save the hospital nearly $300,000.
Foster also urged the creation of a physician recruitment committee made up of two hospital board members, an administrator and three physicians.
"That committee is just as much for retention as it is for recruitment," Foster said.
While many rural hospitals struggle to build a medical staff, Down East boasts 24 staff physicians-two-thirds of them in primary care. The physician mix includes a pediatrician, an obstetrician, orthopedic specialists, a urologist and a general surgeon.
"Carol brings a good level of understanding and is sensitive to medical staff issues," said John Gaddis, D.O., a fellow board member who has been on Down East's medical staff since 1983. "Our board has helped attract a diverse group of physicians. A key element is that we are not all one of a kind."
Preparing for managed care. It can be especially trying for a board member to explain the nuances of managed care as it penetrates rural America. Not unlike other rural areas, Washington County's managed-care penetration is less than 10%.
While board members and healthcare executives across the country may not fully understand the roles their organizations will play in a managed-care environment, Foster is optimistic.
"We have to be ready to try new things," Foster said.
In October, Down East joined with nine other rural hospitals in northern and eastern parts of the state to form the Maine Health Alliance to help prepare for managed care.
Foster sits on the alliance board as Down East's representative.
"The alliance will contract with an HMO or a health plan, but we will be assured some degree of control," Foster said.
She said physicians were concerned about losing market share and what kind of referral patterns the alliance would bring.
"We provided physicians as well as the community with a lot of education," Foster said. "We told them we all had to rethink the way we do business. The whole reason for doing this is that united we stand or divided we fall."