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Skyline Hospital, KVH looking to create county-wide ambulance district

Hospital boards agree

A large coverage area with low population density, looming budget cuts and little to no profits are putting a strain on Klickitat County hospitals, which must adapt to a changing economic landscape or perish.

On Jan. 24, for the first time in the history of either institution, the boards of commissioners for both Skyline and Klickitat Valley Hospitals met together and held a public meeting at Skyline Hospital to discuss challenges and common ground the two facilities shared.

The historic pow-wow resulted in both entities deciding to pursue the creation of a county-wide ambulance system and Emergency Medical Services district in an effort to reduce costs while still maintaining the same levels of service.

The decision was partially made due to proposed budget cuts at the state level. Last fall, House Bill 2130 was reviewed in a special session of the Washington

State legislature, which could have large impacts on Critical Access Hospitals such as Skyline and KVH. The bill, which is sponsored by Democratic Representatives Eileen Cody and Ross Hunter by request of the Health Care Authority, would cut tens of millions of dollars from CAHs by reducing the rates at which they are reimbursed by Medicaid and Medicare.

The bill is currently being reviewed by the House Ways and Means Committee during the legislature's current regular session

in Olympia and healthcare administrators are looking for cost-cutting measures -- whether the bill passes or not.

"We've recognized that nobody at the state or federal level cares whether we exist or not," said Skyline CEO Mike Madden during the joint meeting.

"We've seen more challenges now than we ever have before" he added.

Hospital administrators didn't have to look long to find where the hospitals' biggest deficits were: ambulance services.

The ambulances are funded from a variety of sources. While Skyline does own its two ambulances (one of which is based in Dallesport), it gets close to half of its funding from an EMS District levy

. This levy is responsible for providing $400,000

of the service's $800,000 to $1 million annual operating costs. Approximately $450,000 is bankrolled by Skyline toward the service and the majority of the remainder is reimbursed

through Medicare.

The problem is that ambulance services affiliated with CAHs get reimbursed less than ambulances that are not affiliated with CAHs. Madden said that when CAHs were created as part of the Federal Balanced Budget Act of 1997, Medicare reimbursement for ambulance services was reduced because it was expected that under their new designation, CAH ambulances would receive federal subsidies earmarked

specifically for them. However, the legislation to allocate these funds to CAHs never materialized and Medicare reimbursal rates for CAH ambulance services did not revert to previous levels. Madden said this affects Skyline a great deal.

"We get the lowest reimbursement rate possible on ambulance services for a Critical Access Hospital," explained Madden.


CAHs get approximately one third of their ambulance service costs reimbursed, Madden said that some non-CAHs get up to 80 percent of their costs covered. If Skyline and KVH could relinquish ownership of their ambulances and form a county-wide EMS district and ambulance system, the ambulances could get the higher reimbursal rate since they would technically be no longer affiliated with CAHs.

Although the district would still need some form of levy subsidy, Madden said that if the reimbursal rate is favorable, the levy amount could decrease and so could the cost to taxpayers.

Madden says the proposed district would help save Skyline from a similar fate that other hospitals around Washington have suffered.

"Hospitals all over the state are laying people off in droves," Madden said. "These are hospitals that don't even have ambulance services."

Even if HB 2130 did end up going into effect in its unaltered form, Madden said the money Skyline would save on the ambulance would greatly soften the blow of the bill, resulting in no loss of service and only a few "personnel reductions."

In order to create this district, hospital administrators must set their proposal before the county commissioners. Madden said it was his understanding that the commissioners had the option of voting to create the district, or could let the people vote on it as a ballot item in an election.

The proposal had been mentioned to one of the three commissioners

who Madden said had a "fairly interested response."

Still, Madden is unsure of when the district could be created -- if it gets created at all.

"It could be done in a couple months," he suggested, "or, it could take forever."

In the meantime, administrators at Skyline have made the decision to reduce the Dallesport ambulance service from 24/7 coverage down to 12 hours a day, starting in March. Madden said this would cut operating costs in half, from $340,000 a year down to $176,000. As it did prior to 2003 when the Dallesport ambulance service began, Skyline's ambulance will have to shoulder the load or rely on service from Hood River, which could increase response times in some areas.

Madden stressed that the creation of a county-wide ambulance district would allow the Dallesport ambulance to return to 24/7 service and have the Skyline and KVH ambulances be staffed by full-time crews. Without the district, Madden said that the cost of running two full-time ambulance crews is now too great for the struggling hospital


"We want the ambulance to be sustained and maintained," Madden said, "and we can't do it anymore."


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