Rural and community hospitals have always been uniquely positioned to make quick and meaningful changes when state and federal regulators alter the rules in the middle of the game. This year’s TORCH Annual Conference will bring together experts in the field who can help you plan for a more transparent future and bring clarity to your board members and staff on exactly what adjustments this ever expanding concept will soon require. Only then can you be sure that you have adequately prepared your hospital for the openness that is destined to arrive.
      Be sure to make yourself visible by attending this year’s TORCH Annual Conference and Trade Show. This conference is your best opportunity to learn the critical information you need to be an effective rural hospital administrator and community leader. As always, our agenda was developed based on the input that the association staff receives from our rural hospital members. Therefore, you can be sure that the topics will be timely and relevant.
     Make your plans now to be in Dallas from April 3rd through the 5th. Please keep in mind that this year’s conference is Tuesday through Thursday.
     Remember that the Annual Membership Meeting will also be taking place at the conference on Thursday morning. An election will be held for the TORCH Board of Directors and members will receive an update on the association’s status and activities since the last TORCH Annual meeting. We look forward to seeing you there.
     This year’s Annual Conference is dedicated to the memory of our founder, John F. Boff, who passed away in July 2006. Our new President/CEO, David Pearson, and the TORCH Board of Directors invites every TORCH member to come to Dallas and spend some time with your colleagues and those companies that support rural hospitals. A summary agenda is printed on page seven, and more detailed information can be found at www.torchnet.org.

Hospital administrators, like most Texans, don’t like to be fenced in. We love our open highways and freedom to choose where we want to go. The TORCH Insurance Program Managers can give you the freedom of choice when selecting the right carriers for your specific needs. HealthSure, Inc., is an independent insurance agency endorsed by TORCH to develop programs for member hospitals and bring choices when it comes renewal time for all your lines of insurance. When buying insurance it’s not uncommon to take multiple bids from various insurance companies. It’s smart business to perform our due diligence and make sure we not only have the best price, but the best coverage. Coverage that, when a loss occurs, the insurance company is there to pay, and pay for the kind of losses most likely to happen in our hospitals. It’s no secret that not all insurance policies are the same, just like not all insurance agents are the same. Hospital risk exposures are complex and if you’ve ever read a property, professional liability or D&O policy in detail, you know how complex these can be, too.
     TORCH and HealthSure can bring you the choices and expertise needed to examine these different policies and insurance companies to ensure that your hospital is truly getting the best deal. In fact, for every TORCH member buying insurance through one of the various programs HealthSure is already doing your due diligence for you. The process of selecting the carrier, analyzing the policy, negotiating enhanced coverage and demanding the best price is what happens behind the scenes on behalf of every TORCH member in one of these programs. For those hospitals that must have multiple bids each year, then selecting the right agent to bring you those bids, compare the pros and cons of each and guide you in making the right decision, not only is smart business, but can save you time, money and paperwork. To learn more about how to make your insurance buying process the most effective and efficient, contact HealthSure at 512-292-3315. And be sure to join us at the TORCH Conference for our presentations “I Can See Clearly Now: The Latest Information on Insurance” at 3:30 pm and 4:30 pm on April 4th!

The TORCH Executive Committee recently appointed Theron Park to serve on the Board of Directors in the position vacated when Pat Dorris moved to Oklahoma.
Theron has served as CEO of Moore County Hospital District in Dumas, Texas since May 2004. MCHD is a progressive rural healthcare organization that includes a 60-bed hospital, 60-bed nursing home, home health, hospice, and ambulance service.
     He has worked at hospital systems in Wichita Falls and Sherman, Texas. He also worked at Deaconess Billings Clinic (DBC) in Billings, Montana, where he began as a Managed Care Analyst and progressed to the Director of Regional Operations. Theron then worked as an Assistant Administrator at Medical Center Hospital in Odessa, Texas .
     Theron is a Fellow in the American College of Healthcare Executives and has been the speaker at several state healthcare conferences. He also has been involved as a volunteer for the Special Olympics, serves as a board member on the Moore County Chamber of Commerce, Dumas YMCA, and Moore County Amarillo College Advisory Board. He was raised in Gruver, Texas, a small farming community in the Texas panhandle. He graduated with a Bachelor’s of Business Administration in Accounting from Texas A&M University in 1994 and a Master’s in Health Care Administration from Trinity University in 1997.
     Theron and his wife, Vanessa, who stays at home with their 9 year-old daughter, Anna, their 8 year-old son, Will, and their 7 year-old son, Blake, are active in their local church and enjoy family and outdoor activities.

Each year, rural healthcare advocates descend on Washington, D.C., to share the needs and issues that hospitals and other healthcare providers are facing. The Rural Health Policy Institute attracts a broad range of participants whose job it is to highlight policy solutions and federal legislation that will improve access to high quality healthcare services in rural America. Among the representatives from Texas were David Pearson, President/CEO of TORCH, and Ann Fagan-Cook, CEO of Parkview Hospital in Wheeler.
     While freak weather and a small blizzard prevented many from traveling to Washington, the delegation made up of several Texas provider organizations (including TORCH, TRHA and the East and West Texas Area Health Education Center programs) made their Capitol Hill visits. Even though attendance was down this time, the Texas delegation still managed to visit nearly every Texas Congressman and both Senators.
      The meetings were cordial and the legislative staff that we visited with understood the importance of all the issues in question. You may want to reiterate some of these requests the next time you visit with either your Congressman or a member of their staff. The three-part message should be pretty familiar to anyone in the hospital industry:

1. The President released his proposed Fiscal Year 2008 budget and unfortunately, for the fourth year in a row, the President proposed devastating cuts to rural health funding. The proposed budget eliminates or cuts funding for the following rural health programs:
   • Rural Health Flexibility Grants - Funding eliminated.
   • Small Hospital Improvement Program - Funding eliminated.
   • Rural Health Network and Outreach Grants – Funding eliminated.
   • Rural and Community Access to Emergency Devices – Funding eliminated.
   • Area Health Education Centers – Funding eliminated.
   • Geriatric Education Centers – Funding eliminated.
   • Community Access Program, Rural EMS, Quentin Burdick Rural Training and Health Education and Training Centers – Fails to restore funding to these important programs.
2. In addition to discretionary programs, the proposed budget includes $78.6 billion in legislative cuts to Medicare and Medicaid over five years, with cuts for both programs reaching $102 billion over five years when the President’s proposed regulatory changes are included. Rural providers are already facing cuts as various provisions that help to cover the extra costs of providing care in a rural setting continue to expire. These additional cuts add insult to injury, and ignore the difficult financial situation facing many rural providers.
3. The MedPAC Commission is made up of 17 members, but only one of those members is from a rural area. Over time, a number of rural representatives whose terms have ended have been replaced by appointees who live, work and practice in more urban areas. The National Rural Health Association is recommending that the ratio of rural to urban members be more reflective of the ratio of rural to urban Medicare beneficiaries, which is 1 to 3.

Legislation has recently been introduced in the Senate (S. 498) that would address the MedPAC issue specifically, but also do more. A companion bill is pending. Some of the other provisions include:

• Provides $50 million for quality demonstration projects, focusing on innovative uses for health information technology to improve access and quality of care.
• Eliminates the geographic physician work adjustment factor in the Medicare physician fee schedule.
• Provides $20 million over a five year period for a clinical rotation demonstration project for hospitals in underserved areas.
  

TORCH is a Bronze level sponsor of a new series of workshops currently underway regarding the need to improve healthcare workforce diversity in Texas. These meetings are a collaboration of partners in the healthcare industry, community and non-profit organizations, regional academic institutions and health professions training programs. The goal is to provide a mechanism to facilitate statewide dialogue, develop and sustain a synergistic effort to promote diversity and stimulate the increased use of best practices.
     Presentations at the most recent conference in Lubbock included keynote presentations by Lauro Cavazos, PhD, former Secretary of Education and President of Texas Tech University, and Steve Murdock, PhD, the Official State Demographer. In addition, there were numerous breakout sessions focused on the needs within the various healthcare and educational disciplines, including health careers promotion, medical education, nurse education and other healthcare-related training initiatives.
      There is no doubt that the healthcare needs of rural Texas will be driven primarily by both aging and the explosive population growth among the Hispanic, Black and other minority populations. These meetings are an excellent way for rural hospital leaders to explore how to ‘feed the pipeline’ and plan for the future needs of the community based on the age, diversity and size of the population you will be serving in future years. There are four meetings remaining, so make plans to attend.

Austin – April 19
El Paso – May 4
Houston – June 12
McAllen – July 12-13
More information is available at www.hwdc.org.

By Ann Heape, RN, MS
It seems that every healthcare journal or article is quoting the need for quality in healthcare. This week it’s the Institute of Healthcare Improvement’s 5 Million Lives Campaign and next it is the Joint Commission’s National Patient Safety Goals or CMS Measures. These initiatives and standards are worthy of study and consideration. But are you reacting to the latest and greatest article and so "busy implementing” that you haven’t taken time to tailor them to your hospital? Certainly we can’t ignore a project that asserts it will “protect the public from five million incidents of medical harm over the next two years.” So a team gets formed.
     I suggest a more productive approach would be to design a quality program around the patients you serve and the situations specific to your hospital. The first step is to identify the weaknesses and strengths within your organization. For example, are FTE dollars committed for “the rapid response team” when in fact, it’s your ER that is your highest risk for poor quality? Questions like that need answers.
     I suggest the first step in evaluating your program is to identify the hospital’s scope and services provided. While doing this, the value of the national initiatives can be analyzed.... not just because we are (or are not) accredited by Joint Commission, but because the initiative has the potential for improving current outcomes. Steps toward energizing quality programs include:

1. Define quality in concrete terms...for the services provided. What exactly do you want the outcomes, wait times etc. to be... or what inefficiencies, waste or errors need to be eliminated or reduced?
2. Prioritize at the senior level, which initiatives are needed and what weakness are to be resolved. Many times projects are entered into without a commitment to change. Teams drift along without conclusion if they are not charged with an outcome, a time-table and resources to complete the task.
3. Assign teams that include a strong leader, a physician leader and ‘leader’ staff persons. Give them direction to develop a plan of attack and implementation.
4. Resolve that failure or status quo is not an option before undertaking a project. A team charter must identify goals.
5. Tell the board what you are going to accomplish. Develop expectation tracks including task completion, implementation and reporting schedules.
6. Collect valid data on all initiatives and turn that into information using basic statistical analysis....you don’t have to be a statistician to identify trends/patterns.

This and other ideas on energizing your quality program will be discussed in our concurrent session “Revealing Reality: Quality, Patient Safety, Transparency” at the TORCH Conference on April 4th. I look forward to seeing you there!

S.B. 910 by Senator Craig Estes and H.B. 2452 by Rep. Lois Kolkhorst are the elusive ORCA sunset bills that we’ve all been waiting for. At issue was whether or not the rural health programs would be exported to some other agency and it appears that will not be the case. Even so, there are numerous other changes that the Legislature will be forced to reconcile, including the make-up of the Board, the agency’s powers and duties, and the role of the State Review Committee.
     Here is the section of the bill that relates to the agencies’ powers and duties printed as if the new bill was adopted as is:
     Sec. 487.051. POWERS AND DUTIES. The office shall:

(1) assist rural communities in the key areas of economic development, community development, rural health, and natural resources;
(2) serve as a clearinghouse for information and resources on all state and federal programs affecting rural communities;
(3) in consultation with rural community leaders, locally elected officials, state elected and appointed officials, academic and industry experts, and the interagency work group created under this chapter, identify and prioritize policy issues and concerns affecting rural communities in the state;
(4) make recommendations to the legislature to address the concerns affecting rural communities identified under Subdivision (3);
(5) monitor developments that have a substantial effect on rural Texas communities, especially actions of state government, and compile an annual report describing and evaluating the condition of rural communities;
(6) administer the federal community development block grant nonentitlement program;
(7) administer programs supporting rural health care as provided by this chapter;
(8) perform research to determine the most beneficial and cost-effective ways to improve the welfare of rural communities;
(9) ensure that the office qualifies as the state's office of rural health for the purpose of receiving grants from the Office of Rural Health Policy of the United States Department of Health and Human Services under 42 U.S.C. Section 254r;
(10) manage the state's Medicare rural hospital flexibility program under 42 U.S.C. Section 1395i-4;
(11) seek state and federal money available for economic development in rural areas for programs under this chapter;
(12) require office employees who work at locations other than the central office to be based in Department of Agriculture offices; and
(13) in conjunction with the Department of Agriculture, regularly cross-train office employees with employees of the Department of Agriculture regarding the programs administered and services provided by each agency to rural communities.

These bills will soon be referred to their respective committees in both the House and the Senate. We will continue to monitor this process and make every effort to ensure that ORCA remains a vital source of support and financial assistance for rural healthcare providers. To view the entire bill or to track any bill’s progress during the legislative session, go to www.capitol.state.tx.us.

As a political subdivision, public hospitals can access tax-exempt financing options for almost any non-commercial purpose. When it comes to things like equipment, there are four forms of financing: bonds, certificates of obligation, tax notes and municipal leasing. At a Brown Bag Teleconference held earlier this month, representatives of the Frost National Bank advised TORCH members why municipal leasing might be the best way to finance your next piece of capital equipment.
     Municipal leases in Texas come in two flavors: those that include a non-appropriation clause and those that do not. Leases that include non-appropriation are not subject to voter approval and are not counted against a public hospital’s statutory debt limit. Those without non-appropriation don’t require voter approval either, but they are considered debt, may contain a sinking fund and will include a pledge of ad valorem taxes.
     The interest rates for municipal leases are a little higher, but the risks associated with this type of financing are a little higher as well. Municipal lease payments can be flexible. For instance you can elect lower front-end payments, but they are fixed and fully amortized, which means there is no balloon payment at the end of the lease. Also, in most cases the personal property or equipment itself is the collateral.
     Turnaround time is usually a mere fraction of the time allocate to the process of securing tax exempt bonds. To find out more, you can contact Mike Falk, Senior Vice President, Public Financing Division of Frost Bank, or Scott Anderson, Senior Vice President, Frost Leasing. For that matter, Scott invites you to call even if you just have general questions about tax exempt financing. Frost National Bank is a TORCH Corporate Member. Mike’s phone # is 512/473-4960.

William Gamel, MD, CEO of TMF Health Quality Institute, retired in February. Under Dr. Gamel’s leadership during the past two years, TMF embraced a new strategic vision as he restructured TMF to capitalize on new growth opportunities while maintaining the high quality of work that healthcare providers have come to expect from the state’s CMS-designated Quality Improvement Organization.
     A physician for over 40 years, Dr. Gamel has dedicated himself to patients and the healthcare industry, serving as President of TMA, Travis County Medical Center and many other key roles. Dr. Gamel now plans to turn his attention to his family and volunteer work where he can continue to contribute to the improvement of health care for all patients.
     Tom Manley, Senior Vice President of Review and Compliance at TMF, has been selected to serve as Interim CEO until a permanent replacement is chosen. Tom has been with TMF for almost 20 years and has a strong background in TMF’s work with CMS and developing new business. The strategic direction and programs initiated by Dr. Gamel will continue under Mr. Manley’s leadership.

We had record breaking participation in this year’s annual salary survey. That means that the results have been mailed free of charge to over 90 TORCH member hospitals. The data was compiled utilizing the information that was received from 87 hospitals in the Administrator/CEO Survey and 92 hospitals in the Employee Survey. Many thanks to Joe Rogers and the hospitals which elected to participate. Your data contributes greatly to the accuracy and relevance of the report. Other hospitals can purchase a copy of the report by contacting Joe Rogers at Human Resources Healthcare Consultants, 254-778-9455.

The new Legislative Report prepared by the TORCH staff was presented to members of the Texas legislature on Rural Hospital Advocacy Day, February 14th, at the Capitol in Austin by hospital administrators who attended the event.
     Participants in this year’s Advocacy Day were also treated to an address by Representative Warren Chisum, Chairman of the House Appropriations Committee.
     The Report gives clear and compelling information on the critical issues facing rural hospitals, including their economic impact in Texas. Explanations are provided supporting the 15 legislative priorities for this session as well as data on rural healthcare matters in our state. The report, which was mailed to all members of the Legislature, and the Texas Congressional delegation, will provide information they need to understand what is required to sustain rural healthcare in Texas.
      The TORCH CEOs, staff and trustees who were present, were recognized on the floor of the senate by Senator Kevin Eltife (R-Tyler). Senator Eltife introduced a resolution that highlighted our members’ contributions to rural health in the state of Texas.
     The participants then gathered on the steps of the Capitol for a picture with the Senator. Chris Stipe, CEO of Quitman, and John Hart, CEO of ETMC Clarksville, were present from the Senators’ home district.