Keeping the Public Informed

Richard Lind

Memorial Health Systems, Inc.

This is a presentation made in writing to the Board of Commissioners of the West Volusia Hospital Authority.
December 21, 1999

Mr. Jeff Portman, Chairman,
West Volusia Hospital Authority,
P.O. Box 940,
DeLand, FLA 32721.


Dear Mr. Jeff:

On December 14th several members of the Memorial Hospital-West Volusia Board of Directors and I received an anonymous communication through the mail. This communication is typical of some that we have previously experienced and includes numerous, apparently deliberate misrepresentations, and misinformation.

In an effort to keep you and your fellow commissioners better informed regarding these issues, I am forwarding the attached clarification communication that I prepared for the hospital board. Should you have any further questions and/or would like additional information, please let me know.

Enjoy the holidays and please accept my best wishes for the New Year!


Richard A. Lind



CC: WVHA Commissioners

Keeping the Public Informed

Clarification of Misinformation
Concering Memorial Hospital-West Volusia Operations

In response principally to the Balanced Budget Act of 1997, Memorial Hospital-West Volusia, along with hospitals throughout the nation, was forced to completely reevaluate all aspects of financial operations this year. For example, this year's annual adjustment for Medicare reimbursement, Memorial Hospital-West Volusia's largest single revenue source, was a reduction of 2.75% (roughly half a million dollars in annual inpatient revenue). This decrease is in addition to the numerous other reductions associated with the Balanced Budget Act. Memorial Health Systems' response has been to analyze each expense and seek every avenue for revenue expansion to meet the challenge. During the intensive budgetary process that we called ``Success 2000'', every effort was made to be as fair and exuitable as possible. Patient care remained our first priority throughout. While the expense cuts needed to help Memorial Hospital-West Volusia weather this storm are difficult for all concerned, they were necessary to ensure our community hospital's long-term viability.

We recognize the difficulty the general public may have in understanding some aspects of the complex financial challenges all hospitals have had to accept this year. However, we cannot allow unfounded rumors and incorrect accusations to go unanswered. Public support is essential to our hospitals' employees, medical staff and board; and it is crucial for our communities to work together with us on an open and above board basis to maintain our hospital. We provide the following information to answer some of the untrue rumors currently circulating in West Volusia.

1. ``You won't provide your pink lady meals.''

Volunteers provide highly valued and respected assistance for patients and visitors at the hospitals they serve. For many years now, it has not been common practice among hospitals in Florida (to include Memorial Health Systems) to provide free meals to Auxilians. Memorial Hospital-West Volusia has not provided free meals to Auxilians for more than four (4) years.

2. ``You have now stopped matching your employee pension contribution.''

During the Success 2000 budgeting process, a committee of hospital staff representing all three facilities reviewed all employee benefits. While the hospital continues to fund the pension of every participating employee, the committee recommended eliminating a company-matching plan for employees' additional voluntary contributions. The committee felt that this cut of the extra pension match was more fair than reducing other benefits (like health and dental insurance, which remained intact). All benefit adjustment will be reevaluated during next year's budget preparation.

3. ``You cancelled employee Christmas party and holiday gift certificates, etc.''

In light of the cost containment issues, the same benefit group mentioned above mentioned above recommended the Christmas Party, which cost more than $ 35,000, be cancelled this year. This was also a recommendation frequently heard from hospital employees who indicated they would rather not have the party this year if it would help in ``saving a job.'' The Christmas party and gift certificates are not a ``benefit'' but a gift to our staff when financially feasible. There have been times in the past when MHS has discontinued this gift for short periods of time. The Memorial Hospital-West Volusia Medical Staff graciously gave Holiday gift certificates to all employees.

Another extra that was eliminated this year was the free coffee that the hospital had offered to employees in years past. While this was a popular premium, the total cost to the organization was approximately $100,000 (roughly the cost of two nurses.) Coffee is now available to employees for twenty-five cents and is free to auxilians.

4. ``Isn't employee appreciation still what makes a hospital run?''

As stated in the Memorial Health Systems mission statement, ``Employees are the foundation of our success.'' Hospital employees are recognized in many ways, throughout the year. Exemples include the Employee of the Quarter recognition, the annual employee awards banquet, and two local programs, ``Caught in the Spotlight: and Honor Roll'', which provide both recognition and rewards.

5. ``We have developed a bad reputation for slip shod healthcare. (I.e.: pool nurses, 5-8 hour stans in Emergency Department, patient rooms closed due to lack of staff, etc.).''

Our community hospital's reputation has improved dramatically over the last five year. Patient satisfaction scores continue to improve each year. The volume of letters and visits expressing displeasure with services we provide has decreased significantly while complimentary phone calls, visits and letters have increased proportionately. The public offers numerous positive comments at community events and Board of Director's feedback has improved markedly over the past four years.

Utilization of licensed, experienced pool nurses (which is a common practice in Florida hospitals) has been necessary when we are unable to find qualified applicants to fill vacancies or to cover during high census swings. The hospital contracts with reputable agencies and frequently utilizes the same nurses for extended periods of time, to help provide qualified, competent staff. If there is any problem or concern relative to an individual's work, they are not rescheduled at our facility.

Despite Memorial Hospital-West Volusia's Emergency Department being the second busiest in Volusia County, patients' average length of stay in the Emergency Department is approximately 2.5 hours. This length of stay is well within national guidelines and significantly lower than some other area facilities.

6. ``Business is so bad that nurses are sent home in middle of shift so you don't have to pay them.''

This year, admission to Memorial Hospital-West Volusia increased nearly 8% over 1998. Well-managed hospitals staff for average anticipated needs. When unpredictable shifts in volume occur in any area of the hospital, not just nursing, staffing is adjusted to work load. When possible, employees may be ``floated'' to other areas or other Memorial Health Systems facilities which may require assistance. Employees may choose to utilize their Personal Leave time or take the time off without pay when this occurs according to the employee's choice.

7. ``You borrowed money from a bank to make payroll.''

This is not true. Memorial Health Systems has not borrowed money to meet payroll in at least twenty years.

8. ``The morale at our facility is the lowest its ever been and getting worse each day.''

Despite difficult circumstances, Memorial's core employees have pulled together to face these challenges and understand the basis for the difficult budgetary cuts made this year.

9. ``The $52 million bond money is spent.'' In August of 1996, Memorial Health Systems closed on a $48.6 million tax-exempt revenue bond issue. The net proceeds of this bond issue (after discount, fees, and insurance) was required by the Internal Revenue Service to be spent by July 1, 1999, as follows:
Facility Use Percent of Total Dollars
Ormond Beach Routine Capital Equipment 31.3% $14.6 million
Flagler Routine Capital Equipment 2.3% $ 1.1 million
West Volusia Refund Authority Debt 66.4% $30.9 million
Expansion and Modernization
Total: 100% $46.6 million

10. ``Lind is out trying to sell 49% of Memorial Health Systems to raise money.''

There is no initiative to sell ownership of Memorial Health Systems. Perhaps this rumor is the result of a misunderstanding of the joint ventures that our hospitals and others across the nation have entered into to improve the breadth and efficiency of health care services.

11. Independent release of executive compensation information has raised questions about the appropriateness of Memorial Health systems' salary structure.

[see salaries]
Federal law now requires public release of IRS form 990 which includes listing of compensation for officers and directors of not-for-profit corporations. When considering appropriateness of the pay structure, it should be kept in mind that Memorial Health Systems is the largest non-governmental employer in Volusia and Flagler Counties with annual gross revenues of over half a billion dollars, nearly 3000 employees, and an annual payroll of nearly $100 million per year.

The Memorial Health Systems Board of Directors has a longstanding policy of compensating all employees at a competitive yet reasonable level compared to other hospitals, both locally and nationwide, based on independent market evaluations. The pay plan for all employees­including executive personnel­is geared towards paying at the median level on a market comparative basis. All aspects of the compensationplan are reevaluated annyally.

December 17, 1999.

The material above was provided by Richard Lind of Memorial Health Systems, Inc., Ormond Beach.

The material was re-keyed and adopted for web display by Tanner Andrews, one of the Taxpayers of Volusia County. Most of the errors (eg: ``Dear Mr. Jeff'') and linguistic infelicities are original with Mr. Lind. Transcription errors are purely the fault of Andrews, of course.

Release of this information is done in the way of a paid political advertisement provided by Tanner Andrews, P.O. Box 1208, DeLand 32721, independent of any campaign or committee. No candidate has approved this material.