Accountant: RMCH finally turning a profit
Hospital will still come up short in FY 2005

By Zsombor Peter
Staff Writer

GALLUP — During its first meeting opened to the public, Rehoboth McKinley Christian Hospital's governing board heard both good news and bad about the health care facility's financial predicament.

According to Tony Gonzales, a local accountant and chair of the board's finance committee, the hospital will likely end up with revenues approximately $12.8 million short of expenses for the 2005 fiscal year, which came to a close at the end of last August. The figure isn't final; Gonzales said the official audit would arrive in the next few weeks.

The news isn't much of a surprise. The hospital hasn't ended a fiscal year in the black since 2002 and found out it had lost some $11 million last May. One of the hospital's biggest problems, officials have said, is its flawed billing system.

"Cash flow's still a problem," said Gonzales, adding that he expected the hospital to have its billing system fixed within the next few months.

It's getting there with the help of four of the half-dozen consultancies currently working for the hospital, said Chuck Wright, Rehoboth McKinley's new CEO. The other two are studying the hospital's productivity.

On the bright side of things, the hospital has turned a profit for the past three months straight. It should have an easier time carrying on the positive trend once the consultants wrap up their work, which Gonzales expected to happen within the next few months. According to Wright, Rehoboth McKinley spent somewhere between $250,000 and $300,000 during the past fiscal year on consultants alone.

Thursday marked the first time the hospital's board allowed the public to sit in on its discussions on broad operational matters.

Wright hopes the move will help erase its image as a "private club," an impression he's heard repeatedly since arriving in Gallup. Though this was only his third board meeting as the hospital's new CEO, he did sense that the board was a little more tentative than before with a member of the media present. He thinks that will change with time.

Under the state's Open Meetings Act, the hospital has very little legal obligation to open its meetings. Technically, the law only applies to the policy-making agencies and authorities of the state and its counties, municipalities and districts. Most of the hospital board's business, despite some public funding, doesn't qualify.

Wright thinks the board's decision to open up a little more will be a good thing for the hospital.

"I view the hospital as a community asset," he said.

The more information the hospital shares with the community, he hopes, the more the community will support its hospital.

But even the board's new-found interest in exposure has its limits. Of the dozen reports, presentations or action items on the board's agenda Thursday, four were addressed behind closed doors.

One of those items included the hospital's ongoing contract negotiations with an Albuquerque-based radiology group. The hospital has been without a long-term contract for radiology services since severing ties with a local group of doctors in 2004 for financial reasons it never clarified. If the current negotiations go well, Wright said he hoped to have a new contract for at least one full-time, Gallup-based radiologist finalized by April.

During the public portion of the meeting, Wright also announced his plans to begin meeting bimonthly with the hospital's employees department-by-department.

Gallup Mayor Bob Rosebrough also showed up to deliver a "state of the city" report to the board. After placing the most emphasis on the city's efforts to meet Gallup's water and affordable housing needs, the mayor briefly noted the city's success at maintaining a healthy cash reserve.

"Can the hospital borrow money from the city?" quipped board member Jerry Smith, in light of the hospital's less favorable financial condition.

Probably not. But Rosebrough did say he'd be interested in partnering with the hospital on future fitness initiatives.