The cash reserves for Allen County Hospital are building month by month thanks to the quarter-cent countywide sales tax — and one-half cent sales tax in Iola — approved in 2010.
Every penny will be needed once the hospital breaks away from Hospital Corporation of America come January 2013.
Over the past 15 months, Iola and Allen County have contributed a little more than $900,000 to build up a debt service reserve fund. Of that, the county’s contribution is $577,961, while the city has put forth $326,333.
Under the stipulation of a Public Building Commission bond, the money will not be available for the day-to-day operations of the hospital, but rather to help pay off loans.
Allen County commissioners approved up to $30 million in PBC bonds for the new hospital. Of that, $5 million is for a working capital loan once the hospital backs away from the HCA money trough.
For the first few months of 2013, the hospital will have very little incoming funds for billed services, while it will carry the full responsibilities of bills due.
The turnaround for billings to Medicare is a few weeks, said Larry Peterson, the hospital chief financial officer.
“It will take a few months before we get a nice, even cash flow,” Peterson said. “The first three months will be tough.”
AT THEIR MEETING Tuesday night, hospital trustees approved the design of a canopy to be extended over the sidewalk to the entrance to the emergency room.
While it will not provide a protected drop-off area, the new design goes a long ways to providing better protection from the elements at the ER entrance.
Trustees approved paying Murray Construction $1,159,650 for its work during September, which included installing electrical and plumbing lines, floor slabs, and structural steel.
The substantial completion date for the project is Oct. 15, 2013.
Trustees also approved paying the law firm Seigfreid Bingham PC of Kansas City, Mo., $8,650 for its review of the contract to Cerner Corp. for providing electronic medical health services to the hospital.
Trustees will do a walk-through of the new hospital at their next meeting on Sept. 25. They also will discuss the hospital’s future business plan, using past performance data as much as possible without violating its current operating agreement with HCA, whose headquarters are in Nashville, Tenn.
Still to come is a meeting of minds on if the new hospital should have a new name and what the color scheme of its logo should be.
The fundraising arm of the hospital, Uniting for Excellence, will unveil its efforts to date at a gathering from 5 to 7 p.m. Thursday at Allen County Country Club.
