Yes! Allen County Healthcare


October 21, 2010 - 12:00 AM

Voters will decide Nov. 2 whether to increase a countywide sales tax by 1⁄4 of a cent to go toward a new Allen County Hospital.
Members of the Allen County Healthcare Committee address questions about the issue.
Q: What if the local economy doesn’t pick up soon and the hospital bond issue passes?
A: The November vote authorizes the county to use the quarter-cent sales tax that would be approved to add to the current profits of the hospital and the money from Medicare reimbursement to build the new hospital. Remember the piece from Medicare is 101 percent of the cost Medicare patients incur using the hospital, so if Medicare patients are about half of the inpatients and outpatients, then 101 percent of the cost times 50 percent will be what is received. So regardless of the local economic situation, half of the annual payment on the bonds and all other hospital costs will be taken care of by Medicare.
In a similar way hospital profits should be fairly consistent since 50 percent of the patients are Medicare; the rest are insurance or private pay. The City of Iola has promised $350,000 of its current sales tax for capital improvements each year for 10 years and all of the 1⁄4 cent or about $400,000 of the Allen County sales tax will go to the financing package, if the voters approve it.
Two things have not been discussed yet that will have a positive impact, even in tough economic times. The first thing is a successful bond issue will attract positive feelings among county citizens toward the hospital; some of those good feelings will translate into new patient referrals to the hospital and will help it financially. The second thing is a successful bond issue will appeal to medical specialists who had not considered Allen County Hospital because it was not up-to-date and that appeal should mean a new ability to attract those specialists that bring enhanced revenue to the hospital.
Can these two positive consequences be documented? Yes, they can. In several recent bond issue experiences in Kansas, significant increases have taken place in both patient census numbers as well as attracting new medical specialists and both have contributed to more hospital profits. There is no reason we should not experience the same result.
Growth is not part of the financial plan. We don’t have to have growth to pay for the bonds. But since concern has been expressed that our local economy might not improve soon or that it may get worse, it is important to recognize that it is probable a new hospital would grow in revenue because it is new — this has been the experience of other small hospitals near ours. They attract both new patients and new specialists, which bring additional new patients.
Let’s grow!

ONLY TWO weeks remain before the election. If you would like to help our voter information effort, write to “Yes Allen County Healthcare,” at A.C.B., Inc, 16 W. Jackson, Iola, KS 66749 or contact the Thrive Allen County office at 365-8128.

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