Community activists in the industrial town of Winsted, Conn., are trying to revive the local hospital. So is the hospital's 18-member board of directors.
But neither group sees eye to eye on how to make the ailing hospital well again.
Licensed for 72 beds, Winsted Memorial Hospital's average daily census has withered to 11 patients. It spends more than it generates in revenues and is owed more than $3.1 million in uncollected accounts receivable. And both sides acknowledge that the state's sales and hospital revenue taxes have hurt the bottom line. The board believes the wise decision is to quit the acute-care business and restructure services to meet community needs into the 21st century.
But a grass-roots organization called the Code Blue Committee, organized by local lawyer Charlene LaVoie, argues that Winsted Memorial could continue as an acute-care facility if only it were managed properly. The group has collected nearly 11,000 signatures on a petition to keep the hospital's board from ending acute-care operations. It says the hospital is needed to treat the 30,000 people in its service area.
Residents of Winsted have a powerful ally-consumer activist Ralph Nader. "That's where I was born and raised, and that's our hospital for 94 years," he said.
At a community meeting last week, Nader encouraged Winsted-area residents to focus their energies on a hospital survival plan developed by Fred Hyde, M.D., a former administrator of Windham Community Memorial Hospital in Willimantic, Conn., hired by Code Blue as a consultant.
That plan includes improving collection of receivables, converting empty beds to skilled nursing, getting physicians more involved in management, gaining more managed-care contracts and setting up a Medicare HMO.
"There's an immediate need to stabilize the hospital," Nader said.
Indeed, for the year ending Sept. 30, 1996, the hospital anticipates a net loss of about $2.5 million on revenues of $14 million, said Herbert Isaacson, board chairman and a partner at the Levy & Droney law firm in Farmington, Conn.
Last year, Winsted broke even, posting a slim 1.74% total profit margin and a slimmer 0.32% profit on operations, according to HCIA, a Baltimore-based healthcare information company. With a 21% occupancy rate in fiscal year 1995, the hospital recorded $259,817 in net income on net patient revenues of $14.6 million, HCIA said.
However, Nader contends that with the right curative steps, the hospital's situation "could be turned around quite quickly."
The community outcry was incited by a proposal developed by Winsted Memorial's board of directors. The proposal, part of a broader "vision statement" adopted by the board, called for closing inpatient services, building an ambulatory-care center, converting the existing facility to serve a spectrum of post-acute-care patients and working with other healthcare providers to establish Winsted as a "portal of intake" for coordinating healthcare services, Isaacson said. Some of this could be accomplished through the creation of for-profit subsidiaries, he said.
The vision statement is "a realization that we were losing significant amounts of money each month." It also recognizes the need to partner with other providers and address nonacute-care needs, he said.
Community advocates say the board's plan raises questions concerning motivation. LaVoie suggested that allowing the hospital's financial position to become so endangered was part of the plan from the day James Sok came on board as president in 1994.
"Obviously, that's not true," Isaacson said. "The number of patients produce a certain amount of revenue, and the problem is basically a revenue problem, not an expense problem."
Isaacson added that he thinks "on the whole, management has been quite good." The board recently gave notice that it would renew the management contract it has with Sharon (Conn.) Hospital.
Community forces already have helped to reshape the vision statement, which now calls for the retention of 24-hour emergency services. In addition, Isaacson also credited the community for an increase in funds received from the state's distressed-hospital pool.
Isaacson said the board has asked Connecticut Attorney General Richard Blumenthal to review its proposals to make sure they meet the hospital's charitable obligation.
Nader and community leaders also met with the attorney general last week. "We broadened that issue into whether the board is fulfilling its public trust and the mission of the hospital," he said.
Isaacson said he and Nader have ties going back to grade school days. "At least on a personal level, I believe people on both sides of the issue have the best interests in the community in mind," Isaacson said.
While the community has a "strong feeling" that "if you want something badly enough, it will come to pass," Isaacson said he doesn't know whether the board is ready "to make its decision based on that feeling."