 Before we get started, I'm going to call off the names that I'm seeing and then call off the last four digits of the phone numbers for those that I don't have names for in the system so that Abigail Connolly can take an accurate record of today's meeting on who was in attendance. I am showing Ameren and Michael from the board's legal team. I'm showing Susan Barrett, Jeff Batista, Lynn Coombs, Abigail Connolly, Sarah Kensler, Lori Perry, and Patrick Rooney from the board. I'm seeing all five board members on here. I am seeing Orca Media, Kim Sears, Don Bugby, and from that point I'm going to start reading off the last four digits of the phone number. And if you could just let us know who you are so that Abigail can record your attendance for the meeting. The first phone number are four digits ending in 2505. Jennifer Call of CVM Medical Center. Thank you, Jennifer. The next one is 743-8. Pam Davis. Thank you, Pam. The next one is 5001. Julia Sal with the healthcare advocate. Thank you, Julia. The next one is 8975. Don Bugby and Jerry. Okay, the next one is 8267. Lucy Garence. Good morning, Lucy. The next one is 931-4. This is the court reporter. Great. Thank you. Most important that you wear on. The next one is 931-4. That's me again, the court reporter. Oh, 7081. That's Eric Schulteis with the office of the healthcare advocate. Good morning, Eric. Good morning. Are there people that I missed? Mr. Chairman, this is Jeff Thiemann with the Vermont Association of Hospitals. Good morning, Jeff. I don't know why your name doesn't pop up. I'm incognito today, sir. Okay. Are there others? I see that Janet McCarthy has joined us now. Anyone else? Good morning. Good morning. Did we miss anyone? Just to verify, you have Robin Alvis. That's my brother and Devin from NMC. Yes, and we figured that we would introduce you at your swearing end so that... Is there anyone else? Okay, at this time, I will ask the court reporter to swear in the individuals who are going to testify for Northwest. And Robin, if you're going to call on anybody else, make sure that they're being sworn in at the same time. So perhaps you could tell us the names of people who might speak. That would include Stephanie Devin and myself. It may also include Dawn Buffy, our Interim Administrative Officer, Jerry Barbini, our Interim CEO, and Janet McCarthy, our Board Chair. Super. So if the court reporter puts all these individuals in... One more thing, Robin. It's Dr. Baropi. I just joined late. So you can add me to that list as well if needed. Thank you. Yes. And this is the court reporter. Do you, as a panel, swear that you testify to tell the whole truth and nothing but the truth to help you God? I do. We do. I do. Thank you. And if I could just check with you, Madam Court Reporter, are you hearing everybody okay and everything good? I'm hearing everything fine. Yes, thank you. Okay. If at any point there's a problem, just cut in. I will. Thanks. So with that, I'm going to ask Patrick and Lori to tee up this morning's conversation before we turn it over to Northwest. Good morning, Mr. Chair. Good morning, Board. Can everyone hear me and those following on Skype? Can you see my screen? I can. Okay. Great. So one point of clarification. When we conclude the staff's presentation, Mr. Chair, do you want to allow time for the Board to discuss or should I turn it right over to Northwestern's? I think not for discussion, but for any questions they may have of staff, I will turn it over and call off their names in a set order. Okay. Very good. Thank you. All right. We will get started. Excuse me. Yes. When you speak, you'll have to identify yourself right now. I have a document in front of me on the screen, so I can't see people. So if you could just identify who you are when you speak, that would be helpful for me. Absolutely. My name is Patrick Rooney. I am the Director of Health Systems Finances with the Green Mountain Care Board, and I will be presenting the Green Mountain Care Board staff's overview of the Budget Amendment Request from Northwestern Medical Center. Thank you. Right. So Green Mountain Care Board received the request on April 1st, the day prior to that Northwestern's Board authorized the request to be submitted. The request is a 14.9% increase, which is in addition to the 5.9% change in charge to gross charges that was approved by the Board back in September and made effective in the orders on October 1st that were delivered to the hospital. This new request would be effective May 1st. Northwestern has given us information that shows the 1% value of each percentage point of the increase is equal to about $610,000 of net patient revenue. The gross revenue impact is a little over $32 million for a full year, but for the remainder of this year, we'll have a gross revenue impact of around $13.6 million. The NPR impact for the full year would be $9 million, and for the remainder of this fiscal year would be $3.7 million. You can see in the table below, the NPR FPP that was originally approved was just under $117 million for the fiscal year 2020. They're projecting at NNC that without this amendment, revenue will come in around $108.4 million, and should this amendment be authorized by the Board at the requested 14.9% increase, the NPR FPP would come in just over 112, so still short of the original budget approval for the NPR of $116.9 back in September. The reason for the request given by Northwestern was the offset the negative impact of reduced physician practice visits in related ancillary volume due to the Meditech electronic medical record implementation that began about this time last year, or went live about this time last year, and increased cost of patient care staff to the traveling nurses. We did have a few follow-up questions for Northwestern after the original submission that we had conversations going through the middle part of April. Northwestern, as of that time, had not yet spoke to commercial payers about this increase, even if the Board is to approve the 14.9%, that does not mean that Northwestern and the payer will agree to a 14.9% increase. We wanted to make that clear that they had not yet approached commercial payers as of the time that we received a response from the hospital. We did ask what would happen if it was not approved, and the response was that there would be pressure to reduce services that require subsidies. We were curious to know what the relationship was on a health record or medical record. Was there a problem? Excuse me. You broke up a little bit there. You'd be curious to know what the relationship is as far as I got. Did you hear the part about the commercial payers? Is that what you're referencing? The last thing I had was we would be curious to know what the relationship, that's where it ended. I'll go back a little further. We did ask what would happen if it was not approved, and the response was there would be pressure to reduce services that require subsidies. We were curious to know what the relationship was. Thank you. Back up, because I think the break up skewed what I was saying. In regards to the electronic medical record or electronic health record, that is part of the reason for this request. We were curious to know what was going on with the delivery of that. Was there anything that would require legal recourse for a failed delivery on the part of the EHR vendor? And they said there is no grounds for that. So we eliminated that as a possibility that there would be some sort of financial settlement in the future to the benefit of Northwestern. The adjusted request matches budget utilization expenses. It does not support the budget projections that M&C will reconcile with the 21 budget. And the preliminary COVID impact for April is a 55% reduction in gross revenues. It is important to note that this request from Northwestern is a pre-COVID request. However, we did ask a question about their current situation as it relates to COVID. We felt we would be remiss in our duties if we did not at least get some feedback from them. It's certainly difficult to ignore the eloquent in the room no matter what we do in regards to a rate increase. So we wanted to ask them some questions surrounding that and the 55% reduction in gross revenues is certainly significant as far as a financial impact on the hospital moving into April. Here is how the hospital has laid out the financial impact on their income statement. You can see to the far right-hand side the adjusted mid-year request and the operating income impact that would have one compared to their 2020 projection as of February. It essentially would cut their net operating income loss in half. And it would significantly reduce the total loss that they have on their bottom line. Right now they are projecting, as submitted to us, about a $13.6 million loss when considering losses in non-operating revenues. So here's a breakdown as provided by the hospital regarding the reasons for the request and how that request would be impacted. So as you can see of the total dollars, the EMR impact from volume reduction about $7 million, and the temporary patient care staff, the traveling staff is around $2 million. They break down further the traveling staff expense impact, and you can see from prior years it is run between $200,000 and $700,000. And this year they are projecting a traveling expense in excess of $2.3 million. Here is a year-to-date view of the hospital's performance. I'm very tall to the left. The fiscal year 2020 approved budget has been coming in at a loss of $248,000 from an operating margin perspective. And then we have a month-over-month view through February for year-to-date, and you can see that from October, the first month of their fiscal year, they were in the red $186,000, and as of February the hospital had moved down towards the $4 million mark in negative operating territory. Their projection would put them around $9.6 million for an operating loss, and then you can see to the far right of that year in projections with the 14.9% request approved would still cause the hospital to lose significant money, but yet it would cut their current projection in half. On the bottom, we have their days cash on hand, and it moves in a similar pattern left to right from their budget through their actual months so far and to where they are projecting their year without the request and where they would with it. And everyone understands the days cash on hand calculation speaks very, very loudly during budget times as to where a hospital is and what they can do or should all revenues be shut off till March. So obviously this request would allow them to, whatever reduced loss would allow them to maintain a higher days cash on hand position than they would have otherwise. Through the years on the left-hand side, Northwestern has been in the bottom part of the five-year average approved change in charge with their 5.9% that they received last September. Our calculations show them coming year five-year average of 0.7% over those five years. Should this request be granted today at the 14.9%, they would move up into median territory compared to the other hospitals over the last five years at the 3.7% you see highlighted in yellow on the right. So it would be a significant jump from the bottom to upper middle for the hospital as far as average change in charge is concerned. This is the view as requested at 14.9% around the impact to the hospital. You can see that in September of 2019, the charge was approved at 5.9% that has been effective for almost 60% of the year and would be an effective rate of 3.4%. Proposed from May 1st to September 30th, the 14.9% had to the 5.9% for about 40% of the year bringing an effective rate of 8.7% and total for the year their effective rate would be 12.1%, which for the fiscal year 2020 would be the highest effective rate on charges of any of the hospitals properly received 9.8% back in September. So they would be seconds instead of first now. The NPR dollar change is submitted by Northwestern was just over $610,000. So you can see the full year impact in dollars underneath that and the partial year impact. And in red there is the tie out to the loss that Northwestern would be projecting should they receive this 14.9%. Here we're taking several alternative views to provide the board with a range getting to the same point as the previous slide we have in the top left, 10% alternative addition instead of 14.9 and we move to the right in a clockwise fashion, 7.5% which would be essentially half of the proposed requests. Below that we have a 3% and in the bottom left-hand corner we have a 5%. So explaining some of the logic to why we chose these different views is the alternative at 10% would provide right here an effective rate for fiscal year 20 of about 10.1% which is slightly higher than the aforementioned effective rate that Coughley Hospital received with their 9.8%. The downside to the hospital there would be that the partial year bottom line impact projection would move to 6.2 million from 5 million. To the right we have the 7.5% which is half. Half would be a from our view is a good way of measuring what the impact would be for the hospital should they not receive 50% of this request it still gives them an effective rate of 9% which would be right behind Coughley and of course the impact there continues to show a deeper negative operating margin. And as we move down it continues in similar fashion the 5% in alternative 3% and alternative 4% because they hadn't spoken to the commercial rate payers yet we wanted to go a little lower on the change in charge rate ladder if you will in the event that perhaps they do get an approval here today that the insurance company is not willing to provide a contract that gives them everything they want. So we just wanted to show the board what the impact should be across these different levels of increases should they receive that approval today and be able to negotiate at that rate with their commercial payers. So the next steps are following this the board can have some questioning time as the chair pointed out earlier and then we will migrate to the Northwestern staff for their presentation followed by a discussion and and so with that Mr. chair I will turn it back over to you. Thank you Patrick so at this point I'm going to call in reverse order board members in case they have any questions on the presentation from staff and then we'll move to Northwest. After Northwest presentation we'll follow that same pattern and then open it up for any public comments or discussions before there's any possible board action. So in reverse order board members I don't have any questions on this I think the presentation was clear with what the ask was thanks. Board Member Pelham I agree Maureen I've the presentation was clear and I'm ready to move on to the hospital presentation. Board Member Lunge Stay in here. Board Member Holmes. Yep I'm ready. So at this point we're going to turn over the screen to Northwest and the Northwest team has been sworn in but again if you could introduce yourself as you begin to speak so that the court reporter gets an accurate record of who said what at this hearing. Robin. Yes thank you give us one second please to recall our presentation up. Excuse me Mr. Chair this is Susan Barrett if the presenters could remind folks what slides they're on because others that aren't on the Skype call or not the Skype video call are not seeing the presentation they'll be following it from our website so that would be really helpful. Thank you. You can start on slide one. Correct and just to confirm we have one. We can. Perfect thank you this is Robin Alvis Chief Financial Officer for Northwestern Medical Center thank you for the opportunity to speak today I appreciate the time and attention of the board and the staff in preparing for our discussion today I would like to provide one point around our payers while we have spoken to our payers to alert them that we may have a price increase coming we are not required to obtain their approval our contracts allow for us with advance notice to increase our rate so that is not an issue from our perspective. Certainly between the time that we submitted our request and today the world in which we live in is changed dramatically however the focus of today really remains on our needs at NMC regardless of the COVID environment. Robin could I just interject? Yes. So you made a statement that you're automatically allowed an increase if the board grants it with us with any contract language to verify that. I thought what I read was that there was the possibility of a mid-year adjustment. The reason why I ask this question Robin is the burden of proof will be on you to demonstrate that this request makes sense. There were two hospitals that approached us at a similar timeframe and one when we asked the question went to their carriers and was informed they would not be given the increase and they withdrew their request. So you're going to have to show us that you've met that criteria to show that an actual increase would be put into effect. Hi this is Stephanie Rowe director of finance and I'll just jump in as well. We have at this point actually either spoken to you on the phone or through email or both. All of our major commercial insurance carriers and we let them know that we had asked for this mid-year rate increase and of course their first question was how much is the increase and so we provided them with that information. We haven't heard anything that from a couple of them since what the percentage was but we did ask them to let us know if they anticipated contractually or otherwise any sorts of issues or objections and again we haven't heard back from a couple of them and from one of them we did hear back and what we heard back was okay let us know what the green mountain care board approved. So we have had that conversation not at least at this point feeling any major pushback from them so just so that we're really clear and transparent about what those conversations have looked like and where we've been. Thank you Stephanie. You're welcome. And this is Robin again certainly happy to provide the contract language. I don't think that that request was clear from our perspective and centered more around discussions but to Stephanie's point you have since completed that due diligence and have no reason to believe that we will have a payer barrier. Robin Lunge I had a question related to the contract do you want me to hold it or ask it now since we're on the topic? You might as well ask it now Robin. So you had indicated that that there is no approval required with advance notice can you give us a sense of what that advance notice is? I imagine there may be a range since you have a number of different contracts. Is anywhere from 60 to 120 days but most are on the shorter end of that scale? This is Maureen. I'm just going to for when you're assuming this will take effect since you're looking at May 1st and in many cases you said the minimum was about 60 days so in the financials that you're reflecting how many months are you assuming the rate increase will go through? This is Stephanie again so for us because of the timing related to the fiscal year our math does show that the rate increase goes into effect in May and continues through the rest of our fiscal year so from a contractual standpoint if we do receive pushback that they're going to exercise any kind of 60 day notice or advance before that takes effect then it will have an impact but again at the time that we put this together having never done a May-year rate increase for quacks before the piece around the payer contract is a little bit new to us so as we've had conversations with your staff and as we've gone further down the road of reviewing those contracts it certainly became clear that there may be a timing difference and that the rate increase may not be worth everything that we thought or were hoping that it would be worth but again it's a small date with only a few payers so we're just going to take those conversations one at a time proceed Robin thank you again this is Robin now as I was saying the world in which we live in has changed however our needs existed regardless of how the I think the country's healthcare system in Vermont hospitals in particular related to COVID none of us have those answers so I just wanted to remind that this is focused on the state of our finances pre-COVID and so a lot of the numbers that have been presented don't reflect the changes in the reality which the board should be well aware of relative to the weekly reporting that we're providing regarding our cash flow and our baby cash on hand the two major areas of course that predicated our request was our Meditech implementation certainly has taken longer than we anticipated as with any implementation you don't know what you don't know until you know it with regard to work flows, patient flow physicians being able to navigate well in the product as well as the product needing to have certain enhancements that provide ease of navigation for our providers the trajectory there has been increasing but now that we are at a year the reality is that the lost revenue from that utilization just cannot be recaptured at this point given that most of this stemmed out of our primary care offices and with our ortho and our general surgery the assumption being that those patients need care and they have either gone without or sought their care elsewhere the second component that was the basis for our request has to do with the use of traveler nurses that's been an issue that we've spoken about frequently along with EMR and our by monthly financial sustainability calls at NMC we provide four levels of inpatient care, critical care pro post-surge and medical step down in observation most of our travel expenses is related in the area of critical care that is a highly specialized nursing practice and the reality is that our tertiary partner is not always able to take those patients in a very timely manner we have one tertiary hospital in the state that is trying to handle their own issues around recruitment, retention and bed capacity to prioritize the care of the most vulnerable of the vulnerable so to that end we find ourselves routinely having a lower level critical care our critical care only rises to the level of with the exception of neurology and cardiology which those patients do go to our tertiary provider the reality for us is that we have very very critically ill patients who are either admitted for one day before they can be transported to our tertiary partner or even overnight in our ED until such capacity is generated so part of what we will talk about later is a partnership with Dartmouth Hitchcock around tele ICU so that we can one see more of our critical care patients short of those requiring neuro and cardio intervention theoretically that should help relieve some of the pressure that our tertiary partner has to take those patients that really only they have the skills and resources to care for and I'll speak more about that later in the presentation at this point we will get into the financial slides I will turn that over to Stephanie to go through that and where there are some variances in our financial presentation and some that may have been presented by the Green Mountain Care Board staff we will elaborate on those thank you again this is Stephanie Burrell director of finance at NMC so this presentation is going to kind of look and feel very familiar to the budget presentation we gave back in August because we really wanted you to have sort of an apples to apples comparison as much as possible around you know what does our financial picture look like now if we were to get approved for this rate increase and how do we stack up to our peers so some of this information has actually been covered already by the staff analysis and so it will be a little repetitive but I'll try not to be too repetitive and stay too long I'll try to move us along here so this first slide I'm on the slide now called financial overview FY 2020 and it really just shows the 2020 budget and our 2020 projection again this was using February year to date actual and so it does not have any impact of COVID and when you look through these numbers and you really compare the two columns you know there's two areas that kind of stand out but first and foremost if that top line it's net patient revenue and our net patient revenue is projected to be about 8% under budget in 2020 so for us that's a little over $2 million and that's a significant miss right and this is a conversation we've had internally and so we really drilled down into those numbers and while it is significant and it is a big miss I just want to put into context from an actual budgeting perspective what that means so when we get together each year and we build our budget we are doing it really at that department and at that service line level and we're doing it by provider so we're going into our systems and we're looking at each provider and we're looking at how many days are they in the office doing clinic how many days are they doing surgery do they have any admin time and we really try to be very specific and very realistic and so what this miss equates to is really the difference between budgeting 20 patients a day for one of your providers when really you should have budgeted 18 or 19 and that's it it's really that sensitive once you start applying that toward 365 days in a year or 52 weeks and your entire employed medical staff 40 or 45 providers the numbers do add up that quickly and so I hope that's helpful I just wanted to provide that context and as Robin said a lot of it is related to the implementation of our electronic medical record we went live almost a year ago to this day and so you get some early wins it's so new for everybody and so you get some early traction but really you find yourself at this stage in the game nearly a year later still going through optimization still going through upgrades and trying to improve things but the low hanging fruit is gone and so we will be much more conservative and very careful when we budget for fiscal year 2021 now that that hindsight is 2020 and we've had some lessons learned the other area or line when you compare the two columns that I want to speak to is the operating expenses so you can see that our operating expenses are projecting to come in about 1.5 million dollars over budget 1.7 so the entire variance and then some is related to two things it is our traveler costs which Robin has already mentioned mostly ICU nurses and it's our self-insured health claims we're not asking for a rate increase to help cover the difference in our self-insured health claims we understand that that program we will have a loss on some years and we will have a win on some years however the traveler expense and just how significant that expense and that need has been for our organization this year is something that we do ask your consideration for the actual favorable variance that exists in our expenses once you strip those two things out are really a result of us doing what we can where we can to reduce our staffing in order to live with these new volumes and these new utilization figures that we see so again some of our costs are variable some of them are fixed but I want to assure you that where is appropriate and when we can we are adjusting those staffing models and sending those folks home and so we're going to talk more in this presentation about cost reduction and what we've already done in terms of cost reduction but also what we still have in process or what we know is coming in the future in terms of cost reduction. Here is our operating margin so again the staff presentation covered this we filled in our 2019 actual here it was projected back last August when we did this presentation and we came in at a negative 8% operating margin if we use our February year to date projection our operating margin would be a negative 9.7% for 2020 and if approved for the 14.9% rate increase our operating margin is still projected to be a negative 4.3% and again this is all without any impact of COVID why now still called financial health key matrix and this one is days cash on hand so what we've done here very similar we've updated everything for you and you can see that days cash on hand is projected for us at the end of 2020 to be 182 days if we keep doing what we are doing we are not only doing a lot of expense review and cost reduction and management on the operating side but also on the capital side as well so we are being very selective with our capital spend right now we are looking at every project does not matter if it was previously approved or not everything has been reset and is back to the drawing board so that we are being very careful and very thoughtful exactly where we are doing our capital spend so if you folks already have information about what our intentions were in 2020 we really backed off of that quite a bit and so my numbers will be in what you've seen from the staff presentation if we were to be approved for the mid-year rate increase I project that our days cash on hand would end the year not at 182 days but 197 days and again that is without any COVID impact and then I really made a note here at the bottom just to remind you folks that our bond covenant is a minimum of 182 days full compliance with budget orders and that's going to be the next few slides because we wanted to realizing that a 14.9% mid-year rate increase request is significant and it is large and it is going to make us an outlier in this year there is no doubt about that so what we have attempted to do is show you that here but also show you over time over a range of time I think your presentation before this one went back mostly to 2015 I do have some information that actually matches that same time frame that we'll see in a couple slides this one goes all the way back to 2011 and what this shows us is that even if we were approved for this rate increase it puts our average annual 182% that red dot at the very end with the median of our peers having an average of 4.67% so we feel comfortable that we are still doing something that is appropriate for our organization historical compliance with budget orders and you guys have a very similar slide in the presentation before this one internally we went back to this as our waterfall graph and so we went back on this one to 2011 the presentation before this went back to 2015 and put us in the middle of the pack if you go back to 2011 we showed you this back in August and we were in second place there just slightly better than Copley and this rate increase was approved for the entire 14.9% under this timeframe shows that we would still be in second place but much closer to the rest of the pack not so much of an outlier anymore Copley would still be behind us and Springfield just actually slightly ahead of NMC the budget orders and it's a price comparison graph so this one is the same timeframe back in 2015 so apples to apples with the presentation before this one and that presentation showed up very much in the middle of the pack and this proves that as well so the price of a procedure at NMC that cost a dollar back in 2015 if we are approved for this rate increase would now be $1.18 and the average of our peers would be at $1.19 so again we wanted to make this request thoughtfully and carefully and after looking at this data and this information feel that what we're asking for is still appropriate and is still reasonable when you look at it in comparison to the other hospitals in Vermont we'll speak to our efforts around cost containment and areas that as Stephanie has demonstrated we're not relying on a rate increase to solve all of our issues we are still very aggressively pursuing savings opportunities what you have on this slide slide nine cost drivers and cost containment what we've already done much of this you saw in our presentation back in August have been implemented that was almost a $6 million savings and those savings that were already completed were incorporated into the budget request that we made in August what have we done since August is slide 10 the first staffing reductions in our hourly before this meeting at 9 a.m. NMC our executive leadership presented a voluntary reduction enforced through to every single employee in our organization with the exception of care providers at the bedside and physicians we expect and hope that this will be the savings that we will realize out of a voluntary reduction enforced however we most likely will also have a forced reduction enforced that being said this is we can't rely completely on the rate increase that we're asking for nor can we rely completely on the cost savings we cannot cost our way out of the significant top-line revenue issue that we have areas of reduction are with the provider that's 700,000 that is most mostly related to service line discontinuation that we have already achieved or are in process and then a reduction in rise Vermont that's not not only a staffing reduction but we were supporting a lot of these activities locally in our HSA also supporting state endeavors that are significantly above our peer hospitals across the state and this was a decision to right size that investment also we talked about elimination of leases we had a couple of leases come to you that we did not renew we either eliminated that program or we were able to bring that service line onto our campus where we do not have to pay rent we also eliminated a concierge program this was a very patient friendly program that would help our patients being discharged that had transportation issues or difficulty in either obtaining medical supplies their pharmaceuticals or even groceries to allow them to recover at home we eliminated that program and also we are nearing the completion of a redesign of our health care plan for calendar year one that will yield about $750,000 in savings we've also looked at revenue enhancing strategies in the areas that speak to a need in our community if not in the state one of those is around the sleep program we have a very talented pulmonologist who is partnering with us now to create a sleep program what programs still exist in the state have waiting periods of up to four or five months and this is an acute need that has very costly impacts to the system for patients not being diagnosed with sleep disorders that then create other chronic illnesses that require a higher health care spend for those patients secondly the tele ICU program Dartmouth Hitchcock is our partner there to improve our ability and our skill set in the area of critical care one of our challenges with recruiting ICU nurses is that we don't consistently have the population that an ICU nurse needs for us to have to maintain their skills the same holds true even with our traveler ICU nurses they typically will come maybe for one assignment but then they move on and the reality is that we can't at this point in time we do not think it is in the best interest of our community nor our patients to not offer critical care services as I said short of neuro and cardiology intervention patients that do need to go to our tertiary partner other things that we are considering of course would be additional service line eliminations where there may be a community partner that can carry the burden of that need for our community finally I would just like to wrap up and say that while this isn't this request isn't predicated on COVID we certainly know that with respect to our EMR and all of our challenges that have we not had on a single EHR the challenges of caring for patients and on a shared health record and to the extent that we have had to retrain and mobilize and cross train providers to ensure a safe environment and our very small physical footprint has been tremendous and I think that it has been very affirming in a need for us to stay the course with a single EMR what would be our next step I think Patrick alluded in the presentation they asked us that question what is our contingency plan if we cannot get or are not approved with our request and the reality would mean that we would have to consider eliminating core services that no other partner exists in the community to provide or are not able to handle the scale of what we're contributing I'd love to elaborate on that more specifically because I think if I'm in your shoes I would be curious as to what that means but please just respect that we do not want to alarm any of our patients, our community and our providers prematurely since a lot of those decisions are predicated on the decision that you reached today at this point in time that includes our presentation and we are happy to take any questions from the board. Thank you Robin and again I'm going to start in the reverse order and start with member Maureen Usberg Thanks and thank you Robin and Stephanie for the presentation I'm really going to address I know your ask is really based on two things the EMR impact on volumes and the temporary patient care staff issue a totaling 9.1 million but just to take us back a little bit your capital budget for the EMR was in the 2018 and 2019 budget capital spend over $2 million which the costs were split over those two years and we know that the project was actually being utilized in May 2019 and the goal was to bring the efficiencies of the offices they had to deal with two systems the patients were often receiving two bills so it was to get everybody up onto the same platform so that concept obviously seems good and made that decision for the right reason where I'm having some issues with the number of the impact of the EMR piece the 7 million which is the primary driver of your request is in a few different areas that I'm hoping you can kind of discuss one is you know a budget when you presented your 2020 budget which I know is back in August probably pre when this started because you probably built your numbers in April this really was not addressed as an issue in December on your narratives that you gave us in December you specifically said the short term efficiencies and improvements related to the new systems and work flows have been made the contractual allowance rates are running higher than budget and we believe that the variance continues to be the primary cause or the ACL payments and the risk reserve assumptions so just to bring you back there in December you had brought your NPR numbers down from your full year forecast in December but at that time you said the reasoning was because of the ACL payments and risk reserve assumptions then in January you brought up the issue of having it relate to the new system implementation and for the January you specifically said that the vines related to the outpatient decision practices and the ancillary revenue results from these visits continue to be our most significant revenue concerns some practices primary care pediatrics and orthopedics continue to be challenged by the effects of the electronic record implementation that occurred in May multidisciplinary teams have been striving to improve the work flow efficiency within the program since go live we've reached a break point in the work and will be increasing the number of available schedule visits in primary care and orthopedics this increase will be easier for some of the providers to absorb than others so it will require a ramp up to fully achieve volumes across the board so one of the key questions is how much of this myths is related really to some start up issues and I want to add a couple more points to what you also discussed and one of the things that you said Robin in your comments was that you just said that basically you know this part of this myth was because of those people went away to, if they had orthopedics they went somewhere else if they had a need for an appointment they didn't come back but that's a current year issue not necessarily a future issue so how do we reconcile that this is all last volume that won't come back specifically tied to the EMR go ahead so thank you for those comments and certainly appreciate that you've gone back and sort of tracked the timeline I would say that the biggest thing for us and any implementation is that you go into it expecting a certain timeline and trajectory and you either achieve it or you don't and a lot of the time those timelines are predicated on assumptions that just don't hold true and you can't know until you're living the day to day impact on patient flow provider volumes et cetera I think if I understand your question is how much of our request is addressed to lost revenue versus something that will be ongoing I think that's a very fair question and my response would be it is a mix of both we have seen some patients clearly that needed to be seen you've seen a rise in our ED volumes you've seen a rise in our urgent care or we've seen the rise in our urgent care but it has more to do with the referrals that primary care needs to generate and that lost revenue to our specialty providers or is a pent up demand we do not anticipate at least for the next probably two years to have significantly increased volumes and as a result of that it is changing our recruiting plan to ensure that we add providers to meet the access demands of our community can I ask a follow up on that Maureen I guess when you came in with your budget presentation you already had four months underneath your belt of the switch over to Meditech now you're a year into this and why haven't you been able to address the inefficiencies yeah I mean this is Stephanie I would like to jump into because I'm not surprised in a way that some of these explanations that we've had to provide along the way it seems like a roller coaster because I'll tell you that's exactly how it feels so when we came in August we had been live for four months however our budget had largely been put together not in August but again in April before we had actually gone live or maybe a little bit into May but we really didn't know and so I think when we came in August it was hey we put our budget together then putting our budget together we have gone live with this system and you know what we are experiencing from issues and so we're working very hard to get those issues resolved because this budget getting those issues resolved it depends on it and then we provided you with commentary I forget Maureen if it was November or December that said it referenced short term gains and that's where I referenced in my presentation that there was a lot of work done and there was some things that got fixed whether we had to change the workflow whether we had to work with Metatec and take an upgrade we were able to do some things to make the system better than it was on May 1st when we flipped the switch and I think everybody at NMC would attest to that but it is better now than it was however I think then you hear in our commentary that you know what we've kind of got that low hanging through and now we're at a point where we think this is actually starting to take shape where we know what this looks like we know what living with Metatec in the long term looks like and so we know that it is going to cost us a little bit on the number of patients per day because it is more labor intensive that system from a documentation standpoint from an ordering standpoint et cetera there's other really good reasons to keep the system there's other really significant wins but from a pure I can only see 18 patients a day or maybe 19 instead of 20 I think we are understanding that that's absolutely our new reality and you're right that the other thing that's really impacting our net patient revenue is the ACO but we did not make those ACO challenges part of this request because we understand and you folks that that's a risk based system that's a risk based program and so if we were going to come here and say part of our rate increase has to do with the fact that we are not performing favorably under that ACO and therefore we're having to add more risk reserves to our balance sheet or what not we didn't feel like that was a fair thing to do considering there may be a year where there's shared savings so we intentionally did not want to muddy the waters with COVID we also did not want to muddy the waters with the ACO but you know aren't muddy new waters with that but I just still do have a disconnect between the December where you brought your numbers down from 117 million to 111 million in NPR and really stated it was related to the ACO and risk reserve you also brought up the reimbursement rates that you were getting I think on Medicaid we're going down by like 8 points and you said that also was reflected in these numbers from what I read and can you talk about that as well Yes and Patrick and his staff actually did a great job asking us the question that we responded to yesterday about the ACO because it's complex and it is multifactorial so on one hand when we had prepared our budget originally back last April or May we had a certain reimbursement rate for Medicare and then it ended up that we and everybody else had been getting overpaid for Medicare and so there was a payback associated with that so that's one issue that was being caused another issue and I think we did bring this up in August was you know hey our budget assumes that we do not have an adjustment to our income statement for risk reserve right I am not budgeting to have to pay back a million or two million or whatever the number is and have to add those to my reserve on my balance sheet some of that is coming to fruition and again we don't want to make that part of this request but that is happening and then the third thing that is happening is just small shifts in either payer mix or procedure mix where the amount of procedures that we are doing that we get reimbursed more favorably on are the ones that we in this year are doing a little bit less of so therefore the procedures that we are doing more of don't have quite as favorable of a reimbursement rate and so that you know creates a small difference in your contractual allowance is so that piece is pretty complex but again we tried to keep that out of this request just to be clear and concise. So just on focusing on the 7 million that you were going down in the EMR impact I would assess that situation as there is two things that would have needed to happen it is like one when do you anticipate you will get back there which is either because again it was lost it walked out the door this year but it should come back and then get back there. How do you restructure those areas to accommodate lower volume and eliminate the expenses which I know you have done some expense reduction but if this is a systematic problem where you are no longer going to get this 7 million dollar revenue year over year then the infrastructure that supports that 7 million has to have significant overhauls to make the change because I do look at this request and understand it doesn't get you all the way back this year but the request is a full get you all the way back next year if you had started on a full year basis this 9 million dollar ask gets you back to where you would have been for your operating profit for the year. I would have to believe some of this is not going to stick for the year and year out that you are going to lose your revenue then yes you would need to make significant changes to your infrastructure rather than to rely that a commercial rate increase is going to bring you up 100% and of course the 14 it's 14.9 but it's actually about 20% on services in the hospital and nothing in the position areas correct which is also the area where the EMR was taking the most impact of the 7 million came from the primary care a million surgical a million was general so I mean there's some disconnect there even on where the rate increases are coming in and the fact that you're not going to get any of that 7 million back so I'm not sure whether you can address that or not but that's a big concern. This is Robyn happy to address that and I think it's important to realize that while this is a significant request it wasn't what it wasn't to get us completely whole we know that there is restructuring and changes in workflow with support staff that need to occur and we're planning on making those changes we have made those changes one of the things that is important for you to realize is that to see to see 18 or 19 patients compared to the 20 is still taking the entirety of the support service because of the length of time in navigating and striving in order management referral management for the areas that we have I think the best opportunity and we have seen some significant changes in so I do think that we will be more efficient and we have had to attack this in a variety of options around support service also I think this is another silver lining of COVID ironically we would not have been able to do telehealth had we not been on Meditech and Meditech stood up the virtual visit capability literally within a week with our team and what that has shown us is that to help offset some of the efficiencies and really a belief that telehealth is here to stay gives us some flexibility in our scheduling to improve our daily throughput of patients because we can first telehealth visits which are much more clean in terms of the documentation and those visits don't require support staff they don't require ma's to round with the provider it gives the provider actually a little bit of a breather to get caught up in wrapping up the documentation from the face-to-face patient that they've seen earlier so hopefully that addresses some of your concern and rightfully so about what are we doing to bridge the gap on the efficiency I would also like to say that anytime you are looking at an EMR change you have to factor in a learning curve based on the products that they came from if it's paper it's a much more significant gain than if it's another EHR but the previous EHR and we had more than one was not was going to have to change regardless because it wasn't designed to keep up with the volume that we were experiencing in the expansion of our primary care presence here in our community I won't keep going over that but so the other area was the temporary patient staff care which was about 2 million of the request and just looking at historical where in 19 it was 690 and 18 it was 385 and this year projected to be 2.3 million so you're asking for 2 million of the rate increase to offset that change just want to understand what are their offsets for that specific area right if you're putting on temporary staff it's because you don't have the staff that you either budgeted in regular staff right or you just completely missed it on the budget but there should be some offsets in your regular staff and specifically related to those temporary nurses that you have to recruit also knowing that volume is down happy to address that a couple of fronts in terms of just specialized care that we need and that we have been supplementing with travel nurses in our ICU I mentioned previously our partnership with Dartmouth that is going to provide us with support that we didn't have before and allow us to actually keep more of our patients so that we can retain and not rely on we can have a critical care program that will provide enough challenges to keep critical care nurses satisfied as a regular employee that is something that factored heavily into our decision with tele ICU we can't be in a position of not having enough skill set to care for even one patient that may arrive through the ED that needs critical care I mentioned the four levels of service that we provide in this hospital you know a nurse is not a nurse is not a nurse I can't pull anyone from my labor and delivery and then go and expect that they can manage events so there are some scale issues with respect to the staffing and the skill set needed to care for four different levels of inpatient or outpatient observation here and just wanted to question on your metrics on days cash on hand and on the slide I think through February you were down 10 days on cash on hand and from March through the end of the year through September you were anticipating going down another 53 days so just kind of reconciling that because you know again this system went in in May and your days cash on hand has not really taken much of relative to where you were for budget and now it's supposed to really die I know unrelated to COVID so just trying to understand why you know it's going to drop so significantly in the next latter half of the year one of the first half of the year it was down 10 days yeah I mean I thank you this is Bethany and I think when we say you know this this request is without the impact of COVID I just want to argue that the major significant declines in the market are or are not specifically COVID and so I think I just want to make it clear that you know we know at this point what some of those market declines are and that is being included in here however none of the operating type COVID expenses whether it's the lost revenues is part of that is that clear yeah so if we just did this piece only what would your days cash on hand have changed based on without COVID without any of the other things just this component we've closed our month of March we're just about to close our month of April so I've had that foresight and that information when putting this presentation together but I could calculate that specific piece for you and get back to you okay it is pretty significant it's probably you know at least 15 days so say it was $6 million our market loss last month was $6 million so it's a significant number of days yeah that's another board members chime in thanks okay Member Pellum thank you Mr. Chair and thank you Maureen for leading the charge here your questions are always insightful and helpful all around for me I'd just like to set a little context here that Northwestern is the hospital with a relatively weak payer mix their commercial is at 49.2% at least this is in 2019 and the hospital system overall is at 54.1% Medicare is about even but Medicaid Northwestern is at 17.6% and the system is at 11.4% and so to me those background statistics do have you know call some empathy for Northwestern situation I do note that they're from 2017 to 2019 their cumulative operating margin is dropped by 13.9 million dollars and as noted in the presentation their five-year charge approval has been 7.1% which is the second lowest among hospitals but that said there are some in this presentation some numbers that you know I think need some scrubbing Maureen mentioned the issue of the travelers amount relative to the trend and I just want to kind of point out that the average amount for traveler expense from 2016 to 2019 was 423,000 and now we're looking at a 2.3 million dollar amount in just one year and so I know you spoke a little bit about that in answer to Maureen's question that is a significant scale up it's a 550% increase and I'm just wondering if if you can speak to that again sure happy to do that while of the majority of our traveler expense has come in ICU we still have other provider categories that we did experience traveler expenses in that had to do with our respiratory therapy again a very small staff we have someone out I think on FMLA and ended up leaving that we are currently recruiting for and so we could not be without our full complement of respiratory therapist especially during COVID we've also had some absences as FMLA and or departures with in our diagnostic imaging around some of our radiology technicians that we had to also utilize a travel contract for I think the long term plan and what we haven't mentioned is our investment in partnership with UC I always Vermont technical around the nursing program BTC and the fact that we will be investing heavily in trying to grow our own nurses and one of the future travel mitigation strategies is the partnership with Dartmouth Hitchcock because we will have the ability and support to allow our nursing staff to flex more greatly within their skill set because we do have that support and monitoring from Dartmouth Hitchcock also as I said we need to reach that footprint of critical care that that makes it makes it profitable and to support the resources those fixed resources that we have to have in place for those patients especially coming from you know the northern kingdom that may not that 30 minutes and even if they had capacity to take the patient let me ask a hypothetical if your EMR system had worked as planned and therefore your demand for services were was higher than it has been where do you think your need for travelers would be if your EMR system was working up to par completely unrelated would not have had a single impact okay so I'm looking a little bit at that kind of MPR history here and I know that in your 2020 budget over your 20 over the prior projected amount it was a 20 budget over 2019 projected was for commercial and NPR a 5.4% increase and a 19.3% increase in Medicaid NPR and now with your 2020 projected you're down on commercial 7.7% and down on Medicaid 13.9% and so these are pretty volatile numbers and I'm just wondering do you attribute all of that to the EMR? Yeah, this is Devin Batchel there just as a foreign budget manager those numbers certainly are volatile the EMR is a component of that as the the net collection rates really are a weighted average of a number of components and when some of the more favorable components suffer on the commercial side in particular the net is that you end up with a lower collection rate and so we have a favor more favorable pair mix in our physician practices than in our general hospital service base so we are missing out on you know commercial surgeries and diagnostic imaging which are favorable collection rates we're missing out on those at a higher rate than other less favorable things. On the Medicaid piece that's when we get into a lot of the ACO calculations and risk reserves that we talked about before so those are the primary drivers on those So let me just connect what you just said to your collection rate in your budget you were looking at a 58% collection rate on commercial and that's dropping down to 34% given what you said that makes some sense but the Medicaid rate is dropping from 46.5% down to 38 a little under 39% that's a fairly significant drop so can you kind of tie that change into this presentation? Yeah the other thing on the Medicaid piece that I didn't mention is that as you increase your prices you don't get any new collection so the additional gross charges that come from higher prices are a 0% collection rate so that weighs in pretty heavily when we're talking about some of these higher rate requests Makes sense to me, thank you So I'm looking at kind of the methodology of projecting forward here and on the chart we don't have to put it up here but on the chart that Patrick presented showing your budget the one that we got from Robin had up in the top of it a little bit of a kind of a calculation approach methodology approach which is basically to take the 2020 year date number and divide it by 152 days and then multiply that by 365 and so as you kind of go down through the projected numbers for bad debt, for free care for the dish payment for patient revenue that formula pretty much works but where it is significantly different is in terms of the calculation of gross patient revenue if you apply that formula the gross patient revenue comes up to $221.9 million and if you apply it to deductions for revenue that formula comes up to a negative $127.5 million and those two kind of offset each other so you come to the same bottom line at $108 million but I'm just wondering you know why why that common projecting approach wasn't used across all of these line items or was there another methodology? Which specific line items are you referencing as being different from each other? Say that again I didn't too many people were talking. Which particular items are you referencing as being different from each other having a different methodology? Okay so I'll say let's take a look at gross patient revenue. The 152 day number to date is $92,430 and if you divide that by the 152 days that that covers times 365 which is the methodology that's been applied on these other line items that comes to $221 million and let me just kind of look this up versus the $218 million that was presented and similarly for deductions and revenue projected to date number was $53.1 million divide that by 152 and multiply by 365 and they get 127 million and those two offset each other so you get to the same bottom line but I'm just wondering why the different approach why that approach that Robin laid out at the top of her presentation wasn't followed on these two lines? Yeah and that's related to the seasonality of the revenue the 152 over 365 approach is that straight annualization the projection we used the method we used in producing this file was to look at our percent variance from budget and then look at our seasonally adjusted budget and maintain that level of variation as a percentage of budget but that's why that gross revenue number is a little lower our summers are typically slower we have higher inflation volumes in the winter during a typical flu and long seasons. Okay I'm just curious in terms of the $5.8 million in revenue change for the line item for FPP reserves and other that isn't part of this but it's certainly sitting there in the background are there any expense offsets associated with that revenue loss? Does this Stephanie know there are not because the only real expenses that would go into that to begin with would be our dues to one care so which are about a million dollars a year. Okay thank you very much Thank you Tom member lunch Thank you I wanted to ask you about was to talk in a little more granularity about the application of the charge increases in terms of which services those would. This is Stephanie I can speak to that so our plan is to increase our hospital based charges but I think it's 19.5 percent and then the professional fees we would not increase and again the reason for that and for not doing it across the board if we were to do it across the board increase then the value of 1 percent of increase for us would change just because of the nature of how the payers reimburse those professional fees it's all really fee service and so we don't want to go applying price increases which is going to be a better term a waste of everyone's time because there would be no impact and the other thing that we try to do is really look at where we have our current professional fees and we want to to a large extent make those attractive because we want to encourage folks to continue to get primary care and if you have a high deductible plan or you don't have insurance at all we still want you to come in and see your primary care provider and be able to afford whatever the gross charges associated with just a regular office visit and so we felt like the most you know appropriate thing for us to do with this particular rate increase would be to apply only to those hospital based charges and then to still remain competitive on things like surgery diagnostic imaging lab we also also take that into consideration any time that we're contemplating a change to our charge master. So is it across the board for the hospital based charges? Yes it would be. Okay thank you. To the ICU and the contract with Dartmouth Hitchcock, all the health initiatives to impact your staffing in particular your travelers. One right now we have to have 100% of the expertise needed to care for critically ill patients in house and 100% of the time. So what tell ICU and I will look to Dr. Rofie if he wants to jump in from the clinical side but our expectation is that by having that level of monitoring where we do have patients that maybe are just barely critically ill but we have a nursing staff that can flex between our med surge patients and that maybe one critically ill patient with the support of remote monitoring from Dartmouth. That is going to give us two things. One the ability to probably keep the care local for about 100 more patients a year and then also give us especially overnight that flexibility of staffing where we've got basically three levels of service of care that we're trying to staff instead of four because we're getting the support from Dartmouth Hitchcock. Yeah Robin I think you summarized that well I think it was the doctors and physicians here at the hospital kind of felt very strongly about keeping that sort of level of care here at NMC it was something they felt they wanted to do and this was just a way of kind of ensuring that that would be able to happen for us so I think that summarizes it pretty well. Can I just add a small sub question to Robin questions we don't have to come back to this. Do you mind Robin? No go ahead. I'm just actually wondering if you can quantify the projected net saving with the tele ICU with Dartmouth Hitchcock and the timing of that net saving. Sure we actually expect a combination of savings and revenue growth for an annualized impact of $300,000 a year net revenue and our net income impact the timeline for that is about a six month implementation certainly COVID has impacted that timeline for us and we I wish I could give you more clarity at this point in time when we can begin the implementation but I can't. It will reduce your travelers it sounds like yes but I haven't heard you actually say that. Yes there is you. And do you have a sense of how much it would decrease your travelers? It would be only a swag Robin it's really going to depend on really how successful are we making the right decisions out of the ED around transport versus keeping in house and then the increase of clinical skill sets that will occur over that six months implementation period. Thank you. I was also curious if you have talked with Brattle Brown they closed their ICU in 2016 but in combination with their telehealth initiative with Dartmouth has been able to create a progressive unit where they can do higher levels of care and they're able to staff that up and down with the telehealth and their existing staffing in a way that was much more efficient than maintaining an ICU. So is that anything that you have explored? Absolutely in fact that's why we were talking with Dartmouth and the success of that program began that discussion with us locally because we had a lot of the same issues. Okay thank you. Beth did you have anything else on ICU? No I that was great thank you. All right hold on just a second I got to my next question slide you had talked about some service line discontinuation that you had already started documented on that slide could you speak to what service lines you have discontinued? I found medicine as a standalone clinic no longer exists we did retain some elements of that that were appropriate to be embedded in our primary care setting to still continue in the progress on the triple aim of improving our population health. The other is in the process of our hope and recovery program which is our addiction medicine program we do have other partners in the community who are desiring to come into the community to care for those patients. You also mentioned right sizing rise remark can you also talk a little bit about what analysis you did in terms of determining what level to fund that? Yes we compared the level of investment that other member health or the other state hospitals were providing we as you all know we were early adopters and led the way through significant subsidies to create that set hold in the state we feel that those efforts and those early investments were appropriate and successful and that now our our investment locally should mirror that of what the rest of the state is doing and allow more room for the ACO to to drive further initiatives around population health. Types of patients were using that program What do you mean by type of patient? So when you described it you mentioned that that program provided transportation, sometimes groceries, some other supports that would allow people to recover at home so I was curious to know if that was a program that was more oriented towards lower income patients or patients with higher deductibles or if you had any sense of the population using that program. That qualified for with an inpatient being discharged and really we did not it was a program we had in place for any patient expressing a need for help, not that we would transport patients but that had transportation issues to go and pick up their prescriptions to maybe have groceries or the proper supplies that they would need at home. Our concierge would go and procure those supplies and have those available for the patients that time it just charged. And so what's happening now for those patients? Unfortunately those patients are having to find other alternatives to meeting that need. Do you expect it will increase hospitalizations or people remaining inpatient or increase nursing home stays? Yes. I think what we've tried to do is transfer as much of that we possibly can to our regular case management staff so I don't want to give the impression that eliminating the concierge program has eliminated our commitment to helping our patients with any of those social determinants. So we certainly still have funding, we certainly still have resources in place. But it is a loss for our organization because what we're missing now is the couple of friendly bodies that would round with our inpatient population every single morning and just say hey, is there something that I can do for you? Is there something that you need? And because for some folks they would go everywhere from upstairs on Family Birth Center and help out new mom and dad and they would be in that medical surgical area as well. So it could be something as easy as a newspaper or take out from a particular restaurant that they were just craving like crazy. But the more serious items we are still really committed to dealing with those through case management and through the funding that we have in place with that program. Thank you. That was helpful. Additional info. Medical record challenges. What assistance did any the quorum offer to you in terms of ensuring that the implementation at the hospital went smoothly? We partner with quorum when we've had a large project going on like an EMR implementation. We make sure that they know what our project timeline looks like, our spend looks like. But I would have to say that from a day-to-day operational standpoint they have been supportive to us but not a physical presence here in the hospital that's really helping us trouble shoot these issues. They've been completely supportive in our conversations with MediTAC about what our difficulties have been just like the leadership here at the hospital and just like the board of directors. But I would probably have to say that as a separate resource there we're not able to say all we have these 10 other clients who have also recently upgraded to this particular version of MediTAC and so let's get the best of all of these minds together and figure out what this hospital has done versus what you are doing to help you try to find some efficiencies. We weren't able to find that through quorum but we did do that work on our own by going to MediTAC asking for the names of the other clients making sure that we were doing these types of meetings with those hospitals to understand what they had done differently that we might be able to implement so even that wasn't your quorum that work was still able to happen. And this is Rob and I would just add to that and keep in mind that this web ambulatory product we were an early adopter of and I think that that may be something that focused enough attention on is that typically and I can tell you I was involved with some of the early ethic installations in Atlanta back ten years ago you learn as you go and being an early adopter has its benefits but it also has certainly some negatives and I think that those were more than anticipated. Thank you. I'll just comment I think any early adopter and quite frankly any electronic system it's not unanticipated that a revenue drop will be the result because of the workflow issue so I'm not particularly surprised although I am disappointed in terms of the length of time of the impact. I don't have any further questions Kevin. Thank you Robin member Holmes. Okay great thank you and thanks for the presentation and a lot of great questions already. I wanted to talk about in your letter Robin your letter outline that as you evaluate services you look at both the financial performance and the importance to our community of retaining that service and so building a little bit on Robin's questions in your 2019 community needs assessment obesity was actually one of your community's top three priorities and NMC's plan to address that top three priority was increasing rise Vermont expenditures and expanding offerings of the lifestyle by film medicine team. So I'm seeing that both of those programs have been cut. You're adding a fleet program which I don't remember seeing as one of the lists of priorities or needs in your community so I recognize you have some choices to make and I would love to hear more about how you're making those choices given this is a priority in your community and it seems to be the first to go. Well I would say that please keep in mind that we had both rise Vermont which is more of a community outreach program we also had lifestyle medicine which was more direct intervention with patients who had chronic disease or obesity. The elimination of lifestyle medicine was as a standalone clinic. We still have health coaches, we still have dietitians and nutritionists, those are just embedded now in primary care when we achieve some scale in providing those services. With rise Vermont in particular I think that to right side that investment at this point in time was the right decision but you know at the end of the day this is, we know this rate increase isn't going to get us where we need to be. We know our scale certainly isn't there, we know our community has needs but we're faced with significant choices of greater good and a combination of that has to be you know a revenue strategies as well as cost containment. Our discussions with one care around their plans for rise Vermont as well as our own understanding and preserving still a presence in our communities, it's not the entire program, it is just reducing the investment from almost a million dollars a year to something that is more in time with what our finances conceptualize right now without eliminating it completely. Going along those similar lines you mentioned as we evaluate those services that result in a negative contribution margin we have to prioritize them according to need of service in the community and availability of the service through other organizations in the local community or in Chittenden County. So first I want to say that it's wonderful to hear that hospitals can in fact estimate contribution margins because we had heard otherwise so it validates that this actually can be done and must be done and it validates the importance of what some of the board is doing with sustainability planning and service line implementation. I want to throw out there the ICU has come up a number of times and I'm sure you're doing this analysis but it would be helpful for us to understand keeping the ICU open versus closing the ICU versus having a sort of a Brattleboro, telemedicine model understanding you have an academic medical center down the road that has an ICU it sounds like there's been some capacity constraints there that have left you with this other option of relying on Dartmouth-Hitchcock helping us understand a little bit of how often is it the case that you have somebody that you would transport but cannot because the ICU at UVM is at full capacity would be helpful in understanding some of the decisions you're making around service lines and where some of your pain points are in terms of your expenses. It looks like the ICU is one of those pain points but what are some of the trajectories that you've considered and you've answered some of this already but I wonder a little bit more if you could help me understand what happens with UVM and their capacity there and why that is not an option. Sure, well first let me clarify your statement around contribution margins and service lines. I think that's the key word and service line is much different than at a department level and I think where we've expressed challenges has been at the department level and not service line level Secondly around the UVM partnership we had and you know Dr. Rofi might can speak to this Dr. Minnadeo certainly could being our stand to know and also an emergency room provider. We had 100 instances for sure because that was the number that we looked at as patients that where if we did have a partnership with Dartmouth that we could have seen rather than transporting to UVM. I am happy to follow up with those exact numbers but I can tell you it happens frequently and you can probably speak with even other affiliated hospitals. This is not a criticism of our tertiary partner at all. It is simply a byproduct of the growth there's a growth center in our state. It's the one area where the population is growing and they are trying to meet that need for the entire state. So I think decisions like Radleboro that they made decisions that we're making where we can actually extend up our acuity level for patients that we can maintain I think will actually impact positively on our tertiary partner to care for more of the sick of the sick instead of those patients being put at risk hanging out in an ED or on a floor where there's not the appropriate skill set 100% of the time to take care of those patients. Okay great. Thank you. Yeah and I'd love to hear more about that maybe through the budget process you know going further understanding where the capacity constraints are I want to talk a little about the EMR productivity losses and the EMR impact and it was mentioned I think in your letter too about $4 million of the $7 million variance came from a decrease in ortho volume and I have this recollection from the budget hearing that NMC was losing ortho revenue because providers were requiring patients appropriately I think to do some obesity reduction and some PT prep work prior to surgery and we heard from the leadership team at the budget hearings that that had two results. This is Stephanie I can speak to this one so we are you know still doing some pilot work and around what we call prehab and that seems to be going really well and we're committed to continuing to do that I think you related to some of what was done are you about to mute this whole time? Jess you somehow muted yourself and Stephanie was already answering your question in anticipation so maybe Stephanie you could start again okay sorry I don't know how I muted myself alright thanks no I'll start again yeah we definitely have done some pilot work and some great work around what we call prehab and so we started that in our ortho department so how do we work with our health coaches which like Robin said we still have and how do we work with physical therapy to make sure that patients are prepared as possible to have successful surgeries and successful outcomes so we had already anticipated a small reduction in volumes related to that work but this 4 million further reduction in volumes that we've not really the most impactful because those surgeries are the highest dollar right so because that was a physician practice where they convert visits into surgeries and those surgeries are high dollar that's really what's creating that 4 million dollars and why that is such a standout number for us in that department in particular okay but probably not related to some of the changing clinical protocols you had already anticipated that I'm also trying to figure out a little bit about in your submission in Northwest I'm trying to unpack a little bit of these productivity losses and I noticed in your submission April 23rd around the fiscal year to date summary that in your 2020 budget you had 42 physician FTEs and as of February you had 32 and there was also a drop off in non-MD FTEs 676 down to 650 651 so I'm also wondering that seems like particularly physician FTEs you know a 25% drop in physician FTEs seems like that could be contributing to your reduction in productivity and in physician visits and all of that perhaps unrelated to EMR so I'm wondering if you can speak a little bit to what's happening with your staffing I know you've talked about some programs you've cut but that doesn't seem to match up the program cuts that have been made already don't seem to match up with the magnitude of the reduction in staff so could you speak to that and how much of that relates to productivity losses that you're saying revenue losses that you're saying the reduction in MDs and non-MD FTEs sure I think probably that MD number weren't supposed to go back and take a second look at it because we are small enough of an organization that we know are MD list and I don't think we have had a reduction that is that significant I can only think of maybe three off the top of my head so we will absolutely take a look at that but one thing I did do while I was prepping for this presentation was go look at total FTEs for the organization and when we sat in front of you guys back in August and said you know we've really got some work to do and we're committed to doing it at that time we had 701 total FTEs in our organization and as of today we have about 670 so we have come down over 30 FTEs but it is not that drastic on a provider level that is mostly with the exception of like I said about three I can think of off the top of my head that is mostly non position and non-provider staff and I would just add to that especially in Ortho we did have Locums providers still there so they may have appeared under contact services as opposed to FTE provider line Jess can I ask a follow up to that question of course so in your presentation that you sent to us prior to today you had listed 1.3 million in non-management payroll reductions and a little over 500,000 in management payrolls deduction and you were just talking about a reduction in FTEs is that that full amount of those two is that strictly related to a reduction in force or is there any compensation reductions there that so on if you're referring to the slide that says what we have already done those were factored in and included those reductions were included in our budget number but to answer your question they are reductions in FTE as we did do on a small cost of living type increase for our staff for this year when it comes to raises however we did none at the management and above level so we have not reduced wages across the board but we have done either none or small salary increases but the dollars that are listed on the slide are not a result of doing salary reduction they really are a result of elimination of positions thank you Jess I wanted to talk a little bit about Dave Cash on hand so as of February Northwest is the second highest in the state of Dave Cash on hand pretty close to first actually and you're projecting that if no other changes are made you'd be down to 182 Dave Cash on hand which there's been a lot of conversation around what an increase in rate would put Northwest at in terms of rate growth over time and commercial rate ask I just want to point out that the median Dave Cash on hand for the state is about 117 115 something like that I want to ask you think about our position here and where we are you could take 15 days cash on hand and have the same adjustment to your bottom line as a commercial rate increase of 15% so why not use Dave Cash on hand if you use the 15 days that you would potentially be using if no other adjustment would be made you'd still be well above the median for the state of Vermont can you speak to that a bit so I guess with all due respect I would probably say is the median for the state of Vermont correct given the impact that COVID has had on hospitals and I think illustrating the need for some cash on reserve secondly I think for us we have a bond covenant of 100 days and that means that we're already out of compliance with our debt ratio on our bond covenant that means that the closer we get to 100 days increases the likelihood that our bond could be called and we would be at zero days so I'd just like to offer that context and then setting anything you'd like to add yeah and I would just add that you know again I know what the state median is but I also respectfully think that that is too low and I think that it makes our system too fragile and so I look to Northwestern and hold up at the standard of you know rating ourselves in hospitals across the country which is kind of why we choose to use that SMP as our benchmark and then I think the only other thing I would say is you know regardless of what the number is today or what the number may be at September 30 as you know someone with you know responsibility within this organization I look at the trajectory of our days cash on hand and what it has done over the past five years knowing that some of that was intentional because of our master facility plan and our renovation that we did but the amount of it that is unintentional is what's absolutely you know concerning to me and alarming to me so I think that all of us should be striving to keep that number healthy not striving to see how low we can go but it has been an absolute crisis mode yeah no of course and I recognize the need to keep this cash on hand and I agree that the state we would love to see the state at a higher level across every single hospital of course during COVID-19 but we also have to recognize the commercial rate increase is passed on to you know patients and consumers who are now facing unemployment facing you know potentially significant hardship in trying to meet their premiums so there's a balance you know the money doesn't we have to figure out where the money could come from and who can best afford it so that's part of the question there but I hear you completely I wish everybody stays cash on hand we're a lot higher two quick more questions and then I'm done have you approached Diva at all for any type of financial relief do you mean you know CMS or do you specifically mean Diva? no I mean Medicaid I mean the state AHS any particular reason? if I would kind of ask for an example of what kind of financial relief you would have in mind well I mean you know I think other hospitals have approached Diva in other ways about loans about whatever entered into the into the thought process you know we've got multiple payers here Medicare is not going to Medicare may be tough and we're making some asks related to the ACO and then there's commercial payers and Medicaid so I'm just curious as to whether any exploration was done about whether or not there might be relief there from that payer but that might not so we can move on and then my last question was actually related to federal money and I know this ask is not related to COVID-19 but even you know you mentioned earlier that some of the days cash on a hand reduction is related to for example investment income that's fallen so there is an impact here that still to some degree being considered in this ask fully I recognize not the operating cost of COVID release and all of that but I'm just wondering now that you have some sense of what the federal money that's coming in for that COVID relief has to that change any of your calculus on the needs of the hospital in general yeah I mean it's still early but we are certainly staying on top of you know what stimulus money is available and we are going through our FEMA application process just like everybody else is I would say at this point you know if I were to take you know my best guess at what days cash on hand might look like with the impact of COVID but with also adding back in any sort of relief that we are going to get in the way of stimulus money we may see that days cash on handy somewhere around 150 150 days but you're saying 182 would be where you would be with nothing but how does it go down to 150 then with stimulus 182 is without the COVID impact other than the loss on our investment okay okay okay got it got it okay well that's the end of my questions and I know they're tough questions you know it's the tough ask that you're making but I appreciate the hardship that the hospital is in and the difficulties that you are facing and I appreciated your honesty with all of the answers to my questions so thank you thank you I will be very brief since we have passed the noon hour in the past Northwest has been penalized by the federal government for failure to meet quality measures has that been rectified and do you anticipate any penalty for this year we've certainly moved in the right direction so I'm not sure of any organization that's perfect but when I look at our provider statistical and reimbursement reports and I trend them back over the last you know three or four fiscal years we are losing less money because of things like hospital acquired conduit tunes and rate missions and value purchasing type adjustments we have lost less money every single year for at least three years in a row and I would just as Rob and I would just add to that you know last fall we did make the decision to create as a full-time position our chief medical and quality officer and we have also made investments in our quality department and that is on our strategic plan to improve our quality and safety as a high reliability organization and part of the operating plan for this year so while we're on the topic of federal government it's our understanding that majority of hospitals receive their second stimulus payment on Friday and that it took into account the corrections for the improper payment in the first round did you likewise receive that payment and was yours corrected we did and it was corrected thank you this isn't a question but just a comment you know you try to make some lemonade out of lemons and you know this whole mess that we're in today is really a bad situation but one of the positives that I would hope to see is that a number of healthcare professionals working in large metropolitan areas may wish to relocate to Vermont and it may be one of the things that helps us with our tremendous workforce shortage I'm not saying it's the be all or the end all but I would hope that over time we're going to see a reduction in travelers because people are going to see the real value of being able to live in an area where they can have social distance they can grow their own food they can feel much safer than where they are today so you don't have to respond to that that's just a comment on my part with that I'm going to turn it over to the public and I understand that Sarah Teach out has a comment yes thank you this is Sarah Teach out from the government relations person from Blue Cross and Blue Shield of Vermont and I just wanted to I believe clarify Blue Cross's position towards this request we are neither supporting nor opposing this rate increase we were notified of the request by Northwestern and I don't believe we responded in any way other than to contact them about our advance payment program and what we are advocating for and would hope that the Green Mountain Care Board looks at is a system-wide solution to this health care crisis and the funding of our rural community hospital so Sarah I would agree with that that we should be looking at system-wide but to focus strictly on today's hearing the request has been said that this is not related to COVID that it's pre-COVID events and focusing on that and knowing what we've seen in the past is there anything in their contract that would guarantee them a 14.9% rate increase if we granted it to them no okay which goes back to the burden of proof which I stated at the beginning that I think was on the applicant to do a little bit more homework with the carriers to see if a decision actually could be implemented other members of the public who wish to comment hi yes this is Julia with the health care advocate go ahead Julia thank you so I just have two brief comments from the HPA first we understand that the board might be adjusting some of its procedures because of the context that we're in with COVID but we would like to request a special public comment period on this proposal I'm not sure whether it was an issue on our end or on your end but the HPA did not receive any of these materials in advance and we just sort of appreciate the opportunity to review them more thoroughly second as both board members so Julia on that first point you know we even announced I believe last week or the week before that this hearing was going to take place it's been out there in the public they're looking to get an increase that would be effective as of tomorrow and I'm worried about I don't want to just put out a public comment if there's not going to be legitimate public comment and I don't know why you did not receive anything in advance I'll look into that and assure you that it wasn't intentional and but I'm just curious if you truly believe that something of value would come out of extending a public comment period and thus not allowing us to vote on this request today I mean I think to the decision I mean we would appreciate the opportunity to review the materials and potentially submit a written comment and I think in general we advocate for the public having an opportunity to comment particularly on something that will have a significant impact on consumers and also it sounded like even if the something was approved for May 1st that it wouldn't be implemented for quite a while is that correct well that's an interpretation and the question that I have though is really how much time do you need I mean I think for us like maybe Monday would be fine okay puts us in the awkward position of having to warn another meeting but that's okay we'll consider that okay you had a second question I did yeah I just wanted to acknowledge as both board members and M.C. have that this proposal would be a substantial price increase that would have a real impact on Vermonters I think we all know that Vermonters can't afford this increase and we also just wanted to note that it doesn't seem totally clear to us how the increase will actually address M.C.'s revenue issues in the current context of COVID so we would just echo the request of others that the hospital and the board consider other avenues for looking at the revenue shortfall including the options suggested by board member Holmes and also the systemic approach suggested by Blue Cross and Blue Shield is there a question in there no just a comment okay did you have anything else Julia no that's all thank you okay other members of the public can I have a question yeah I'm Davis go ahead and have you kept we can thank you you can hear me yes I've got a couple of questions especially given that major piece of central point of this request is an ICU could the hospital tell us how many patients as Northwest had since March 3 and how many of those required an ICU Stephanie I may be off but I believe that we have had 12 COVID admissions since everything started we've been managing as many people we can that we know have tested positive on an outpatient basis and some of them did require admission and out of those 12 I believe that about half six to seven of them required care ICU level care and or you know meeting to be on a bed I think those numbers right to me I think half of them required for support in the ICU can I just say something here too is that this is not something that is unique to Northwest there's more capacity than need the strict reality is that Vermont prepared for a scenario that is much worse than that we've seen which is a good thing hospitals were not overrun and but they were asked to be prepared in case the initial analysis and projections came to fruition so I don't think that any hospital in Vermont should be penalized if they have more staff to deal with COVID than what the reality is because they were asked to be prepared yeah and I this is Senator this is Dr. Rofi thank you for that there was substantial work put into the preparation and we might add this is not guaranteed to be over we just don't know what's going to happen once we start opening things up again and people start circulating in the public and furthermore what might happen in the fall so those are good points but Kevin I wasn't questioning that obviously everybody had to prepare the question is if you pause it that you're going to what you come out of what you come out of the COVID period what you have to do then the cost of building an ICU is insensitive and if you can this is this COVID thing this emergency is the first one like it we've had in a hundred years so I'm just saying the question is how you manage to have affordable cost going forward giving that so let me ask my second question Kevin then that I'm done and that is I'd ask the hospital have they done some kind of cost accounting cost accounting analysis of what what you would come out what they would a new or increased size ICU would cost going forward this is Stephanie I guess we're not as part of our rate request we're not proposing any changes to our current ICU and so there would be no dollars being spent and none of this rate increase would be applied toward anything related to our ICU thank you I'm done Kevin thank you ham are there other members of the public hearing none board we have a couple of issues to deal with there's been a request for a public comment period I'm just wanting to get some thoughts from my colleagues on the board on that issue and if the answer is that it's it's not important to members of the board I shouldn't phrase it that way but is there a need for the public comment period probably there is and I'll take the blame if on this issue at the same time I don't know I'll just throw it over to my colleagues to see where they're coming from well this is Robin you know always favor a public comment period quite frankly because I think it is an important part of our transparency I also think that it may provide a few days to get some clarity around the insurer contract firm because I do think the timeline for implementation of the rate increase is an important consideration for me in my decision making and currently what I feel like I heard is that most likely from the date of our decision assuming they notified the carrier immediately there would be at least a 60 day delay in implementing which then makes tomorrow's request date less important not that we should drag our heels or anything like that but I would be surprised if even if we decided today that tomorrow would be the implementation so let me ask the court reporter if we were to have a special meeting on the board on Monday at one o'clock would you be able to cover it? just hold one second I have to look at my calendar Kevin I can't do a one o'clock meeting Monday I can do in the morning what if we were to do a 1030 to 1130 time I think a lot of folks have blocked off on their calendar just so you know the court reporter is off the record while you're kind of let's suggest 10 o'clock on Monday then does that work for everybody? it works for me yes the court reporter can be available at 10 on Monday okay then we'll make the decision that we will not entertain a motion on this today that we will open up a period of public comment which will be open immediately and we'll end at 8 a.m. Monday morning and with that it should not be a long meeting but there could be some very long board discussion does any member of the board wish to begin discussion today or does everyone prefer to hold it to Monday at 10 and Ian although I certainly wouldn't mind hearing if people had immediate thoughts yeah I'm finding a way knowing that we have a one o'clock meeting starting as well so the only public comment that I would have Robin is that I have said all along that every hospital is in a different position than where they were at the beginning of the years budget process in that there is going to have to be a holistic look at the whole system but I have also struggled with what a vote would even mean if we've heard testimony from that it doesn't necessarily result in that increase so I'm I guess my comment is that I'm just not at a position where I feel comfortable granting the type of request that's before us at this time but also acknowledging the fact that everything that Northwest was encountering was encountered pre-COVID and so I recognize the position that they're in so that would be the only comment I would have at this time any other board member wish to comment now or you can wait until Monday morning at 10 well my comment is that as I started off with my question kind of painting some context for Northwestern and I don't think they've been one of the best-advantaged position-wise hospitals in Vermont but I also sense that a lot of this current this request is temporary there's a lot of independent of COVID etc there's a lot of softness about it in the sense of the EMR issues the SPP issue which out there to be resolved the COVID issues out there to be resolved so but I and it's a small amount of money relative to 3.8 million is what they would raise over the rest of the year and still have large problems in their bottom line so a 15% rate increase is a big increase if they're a way to make it temporary so that it would help them you'll get through this year and solve a little bit of their bottom line problem you know I might be open to that it's something that we haven't talked about and I would want to hear from staff etc as to what their thoughts were other board members yeah I guess this is Jessica I struggle with the temporary versus the permanent the issues seem to be a temporary problem and rate increases permanent it's forever baked into rates going forward so that's something that I'm thinking about I don't know back to your point Kevin about the carriers is there a mechanism by which the NMC can go negotiate with the carriers for a solution albeit probably temporary or something else something that's been negotiated which then we might be able to evaluate is that a possible path forward or no well I think that NMC could do more with the carriers prior to the hearing today but that may be a task that is not feasible on the time frame that we have in front of us Jess so may I just add one clarifying about the payers our contracts allow with prior notification for us to do a rate increase so I'm not sure what there was referring in terms of it being guaranteed now certainly our professional services are on fee schedule so it would be not applicable and we've talked about that that this would be on the hospital side certainly we can provide that contract language to the board before Monday that is not an issue so I would suggest that you give us the three largest commercial payers the language strictly related to a mid-year adjustment I know that you may have some restrictions in your contract about what is public knowledge and you could send those with a request to our council to treat them as confidential if you so desire thank you anyone else from the board hearing none I'm going to recess this meeting until 10 a.m. Monday morning an immediate public comment period will be open until 8 a.m. Monday morning and we will pick off 10 where we left off today and also remind everyone that the regular board meeting or the Green Mountain Care Board will commence at one o'clock this afternoon and so I urge everybody to run quickly and get something to eat and take whatever nature break you need