Springfield Hospital can’t pay its bills. ‘It’s very unnerving.’

For the past year or so, doctors said they haven’t been able to get supplies needed to run their offices. Some say the hospital is months behind on health insurance payments. Several businesses in Springfield and doctors in the area have stopped doing business with the hospital.

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Springfield Hospital can’t pay its bills. ‘It’s very unnerving.’ By Katy Savage Dec 11 2018, 6:16 PM | 0 comments The entrance to Springfield Hospital. Eye doctor Richard Lane walked into a freezing cold office on the Springfield Hospital campus one morning two months ago and realized there was no oil in the fuel tank. When Lane called the fuel supplier out of frustration, the company told him they weren’t delivering oil to the office on River Street because Springfield Hospital wasn’t paying its bills, Lane said. So he paid out of his own pocket for an emergency delivery of 100 gallons. “I wasn’t happy,” he said last week. Lane said he’s since been reimbursed the $300 by the hospital, but he is one of dozens of hospital employees and community members who have been impacted by Springfield Hospital’s budget woes. The Valley News first reported on the hospital’s financial troubles on Sunday. For the past year or so, doctors said they haven’t been able to get supplies needed to run their offices. Some say the hospital is months behind on health insurance payments. Several businesses in Springfield and doctors in the area have stopped doing business with the hospital. The head of Green Mountain Care Board, the main regulatory body overseeing Vermont’s hospitals, says the body is monitoring the situation but hasn’t seen any misconduct up to this point. Carla Kelly, owner of Crown Point Physical Therapy, stopped seeing Springfield Hospital employees as patients six months ago. She said the hospital owes her about $5,000 in health insurance payments. “For us it was a lot of money,” she said. John Duff, an eye doctor in private practice, also hasn’t been paid by the hospital for eight months. Duff now requires hospital employees to pay their bills up front. At least three doctors are leaving Springfield out of frustration about the hospital paying its bills late, or not paying them at all (two declined to be named in this article). Tony Masuck, a pathologist who has worked at the hospital about 20 years, is leaving voluntarily Jan. 1. Masuck is employed under Mid Vermont Pathology, a medical practice group based in Rutland. “It’s been really frustrating for a really long time there,” he said. About a year ago, Masuck said supplies he ordered, such as reagents for testing and other items critical to running the pathology lab, weren’t coming in. Vendors told Masuck a credit hold was placed on the accounts because the hospital had past-due bills. Masuck said he and lab technicians took on roles outside their job descriptions. A couple months ago, when a water purifier broke at the Springfield lab and they couldn’t get a part to to fix it, lab techs used their own vehicles and drove to Valley Regional Hospital in Claremont, New Hampshire, to pick up 20 gallons of pure water, Masuck said. Lab techs have also borrowed supplies from Gifford Medical Center in Randolph when they couldn’t get their own. “The whole administration seems in their own little world,” Masuck said. “It’s very unnerving and very frustrating.” Springfield Hospital CEO Tim Ford informed hospital employees on Dec. 3 that CFO Scott Whittemore left his position. Ford told employees of the abrupt departure in an email that afternoon, but Ford never gave a reason. “2018 has been a challenging year in many respects,” Ford said in the letter to employees. “We missed several of our financial targets, primarily due to declining revenues and increasing benefits and locum expenses (on temporary physicians).” Phone messages and emails to Ford were not returned. A spokesperson for Ford said he wasn’t available for an interview. Several phone messages to Whittemore’s home in Springfield were not returned. Anna Smith, who is chief of marketing and communications for the hospital, declined to comment on personnel matters. She said the hospital has started recruiting a new CFO and would hire an interim CFO in the next couple weeks. Smith said the hospital has a cash flow issue, due partly to lower than projected revenue. “In any cash flow situation…you have to prioritize what you pay,” she said. Springfield Hospital contracted with an independent consultant, Quorum Health Resources, in October 2018 to review the hospital’s finances. A report is due in February or March 2019. “We are working diligently to improve cash flow,” said Smith, the hospital’s spokesperson, “and this is an important part of that process.” It’s not unusual for Vermont hospitals to incur deficits: Green Mountain Care Board documents show that, from fiscal year 2015 through fiscal year 2017, 10 of the state’s 14 medical hospitals had operating deficits at least once. During those three years, Springfield’s fiscal 2017 operating deficit of $3.8 million was the largest such shortfall of any hospital. Despite the addition of more than $2 million in nonoperating revenue that year, Springfield’s bottom line was $1.78 million in the red. The hospital’s financial problems are not new. State documents show Springfield’s net patient revenue declined from $55.9 million in fiscal 2015 to $53.6 million the following year and $52 million in fiscal 2017. Springfield administrators don’t have to report fiscal 2018 results until January, but they have made clear that the year didn’t go well for them. Several months ago they revised their projected operating loss for 2018 from $921,697 to $2.5 million. Hospital leaders have told the care board they plan to make improvements in fiscal 2019, though they didn’t sound entirely confident in their budget submission to the care board. “Access to the appropriate care in the appropriate setting for all residents of our service area remains paramount in our planning and our day-to-day operations,” administrators wrote. “Given our difficult payer mix, challenging demographics, economic outlook, the comparatively poor health status of our residents and the ever-increasing social challenges (poverty, low educational attainment, drug use, crime, etc.), this represents a formidable challenge.” The care board, in approving Springfield Hospital’s fiscal 2019 budget in September, agreed to adopt the hospital’s request for a 1 percent increase in net patient revenue and a 5 percent increase in the rate charged to insurers. But much appears to ride on fiscal 2019 being a better year for Springfield Hospital. “If we significantly miss budget in (2019), we will have no choice but to look at programs that do not support themselves due to any combination of volume, payer mix and low reimbursement,” the now-departed Whittemore wrote to the care board in August. “First, we would look at standalone projects (i.e. cardiac rehab, pulmonary rehab). If the miss is extremely large, we would look at larger programs.” Kevin Mullin Kevin Mullin is the chair of the Green Mountain Care Board. File photo by Mike Dougherty/VTDigger Green Mountain Care Board Chair Kevin Mullin said he’s heard complaints about the hospital from community members and elected representatives in Springfield. When Mullin heard Whittemore was no longer with the hospital, “It scared me,” he said. “You don’t want any hospital to fail.” Care Board members asked Springfield and other hospitals that are struggling financially to consider reducing expenses or revamp their programs. “We’re continuing to monitor it,” Mullin said of Springfield. “At this point, we don’t have any knowledge to believe anything inappropriate has occurred.” About 75 percent of the medical staff at Springfield Hospital recently signed a vote of “no confidence” in the hospital under Ford’s leadership. The petition was organized in part by Gerald Drabyn, one of the lead doctors at the hospital. Drabyn was hopeful that the situation could be fixed, but he said the administration will need to stop pointing fingers. “Somebody has to be responsible for this,” said Drabyn. “Someone has to come in and someone has to turn this around.” In October, the hospital abruptly fired contractor Emergency Services of New England. ESNE had maintained a contract with the hospital about 40 years to staff the emergency room. The termination was a shock to ESNE, which employees nearly 40 people. ESNE co-owner Rachel Spengler said the company met with the hospital administration about the budget July 9. At that time, Ford, the CEO, told ESNE there needed to be “significant reductions,” Spengler said. Ford wanted the company to provide less hours in the ER per day, Spengler said. After several rounds of negotiations, ESNE submitted a budget proposal that dropped ER coverage from 60 physician-assistant hours a day to 43 hours, saving nearly $1 million, Spengler said. “They didn’t accept that,” she said. “We knew at that point it wasn’t about the hours of coverage, it was about something else,” she added. “They wouldn’t tell us what the something else was.” As a contractor, ESNE is one of the many Springfield Hospital creditors. The hospital currently owes ESNE more than $500,000, Spengler said. Spengler said the hospital has been late on payments to the company for year and half. “Payday would come and there would be no check,” Spengler said. The homepage of Springfield Hospital’s website. On three occasions, the owners of the company gave up their weekly salary checks to pay their employees on time, she said. ESNE is in negotiations with other hospitals, hopeful to provide services elsewhere and maintain as many of its employees as possible. Meanwhile, Springfield Hospital recently hired a new contractor, Bluewater Emergency Partners, to provide emergency room coverage. The new contractor is expected to bring “significant savings” to the hospital, according to Smith, the spokesperson, but others are concerned the quality of care will impact patients. The Springfield emergency room sees 17,000 patients a year. Bluewater chair Jay Mullen said his company will provide 36 hours of coverage in the hospital per day, down from 50-60 provided by ESNE. “Quality of care and concern for patient safety become a concern (at those staffing levels)” said Josh Cascadden, a physician assistant employed by ESNE who is among those laid off under the Springfield contract. Bluewater staffs four facilities in Maine. The company will take over emergency services in April. Mullen said Bluewater would take feedback from patients and nurses into account and adjust hours as needed. “We don’t expect there to be any disruption in services,” said Mullen. “We hope there’s no difference in care.” Springfield Hospital board chair George Lamb declined to say how much the hospital would save with the new contract. “All hospitals are under a lot of pressure from all avenues to reduce costs of medical services,” he said. “It’s difficult when you make changes that affect people within the community.” The moves of the hospital, which is the largest employer in town, directly impacts the community and surrounding towns. “Never have I seen so much controversy associated with the hospital,” said John Bond, who worked at Springfield Hospital for 42 years until he retired recently. “There’s never been this much concern about the viability of the hospital.” Peter MacGillivray, a Springfield Select Board member, is concerned the hospital could be closing its doors. “If the hospital is in financial distress,” he said, “they need to take steps to remediate the problem.” Top2018News