Wilkes Regional Medical Center RAC losses

7/31/2012

Contact: Tammy G. Love

VP of Business Development

Phone: (336) 651-8116

By CHARLES S. WILLIAMS
Wilkes Journal-Patriot Staff

Wilkes Regional Medical Center has repaid the federal Medicare program $312,412 through June (the first nine months of the 2011-12 fiscal year) under the Recovery Audit Contractors (RAC) program.

As a result, the hospital's net operating income for the period is $11,993. Without the payments, the hospital would have a profit of $324,405. The purpose of the RAC program is to reduce what Medicare deems improper payments and implement actions to prevent future improper payments. Section 306 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) required officials to complete a three year demonstration program to determine whether RAC use is a cost effective means of identifying and correcting Medicare overpayments and underpayments in the Medicare Fee-For-Service program. The demonstration program started in March 2005 in California, Florida and New York, the largest states in terms of Medicare utilization. Two years later, the program was expanded to include Massachusetts, South Carolina and Arizona. "We've made some small payments in recent years, but they have lowered the boom on us this year," said Marlin Markham, Wilkes Regional's chief financial officer.

The hospital paid back $114,000 in 2009, $140,000 in 2010, and $128,000 in 2011. Gene Faile, the hospital's chief executive officer, added, "When a patient comes to the emergency room, we always do what's best for the patient and run what tests we think are necessary. We worry about the patients first and the costs later. If the physician feels that the patient needs hospital care, we always admit the patient or keep them in observation."

"These are claims that, in the opinion of the governments, should not have been paid," Markham added. "All of the hospitals that receive Medicare payments are going through the same audit." "At the time the patients were admitted and the claims were filed, the claims met all of the criteria," Markham said. "It's not that we or any other hospital did anything wrong because we met all of the guidelines. But in cases, for example, of syncope, or fainting among elderly patients, tests may have been called for to determine the reason for fainting. If it turned out that it was caused by low blood pressure, and other tests were run, Medicare may rule that the other tests were unwarranted." Wilkes Regional has been successfu, to date, in contesting 20 percent of the revoked claims and reclaiming the money. The hospital paid back $131,000 through the RAC program in July. Markham estimated that the total for the fiscal year, which continues through September, would be $525,000.

Nominating committee

At the hospital operating board's July meeting Tuesday night, the nominating committee recommended that C.W. Barker be reappointed as the chairman for the 2012-13 fiscal year. Also recommended for reappointment were Lee Herring as vice president, and Jean Graf as treasurer. The members of the nominating committee are also members of the board. Recommended for re-appointment for three-year terms were Larry Farthing, Dr. Larry Kilby, Melissa Lackey, Arnold Lakey, and Dr. Ashton Molai. Eric Cramer was recommended to a three-year term to succeed Bert Greene, whose eligibility for service on the board has expired. Cramer is chief executive officer and general manager of Wilkes Telecommunications Inc. The board will vote on the new officers and board members in September, and terms will begin in October. Molai and Brent West were approved for three-year terms, to end Sept. 30, 2015, on the board of the Wilkes Physicians Network. The other members of the board are Jim Faw and Dr. Su Albert, whose terms end in 2013, and Bill Warden and Carron Suddreth, whose terms end in 2014.

New registration area

Hospital officials also announced that the new patient registration area in the emergency department will open Aug. 6. All patients, including those receiving out-patient care, will register at the emergency entrance. The outpatient registration area is currently adjacent to the main entrance.

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