SVI Media’s Dan Dockstader sat down with Star Valley Health CEO Dan Ordyna to discuss the latest in the financial situation with the hospital, after the announcement earlier this year that the hospital was facing an unexpected $3.5 million budget shortfall. Ordyna also provided an update on EMS budgets and staffing and the hospital’s partnership with Cigna Health Insurance and if they anticipate being able to accept Cigna again in the future.

A full transcript of the interview can be found below.

(0:00) SBI Media, the hospital today with Dan Ordena, Star Valley Health CEO. Dan, give us an update on where (0:06) we’re at. Of course, the debt looked at 3.5 just a few months ago or a couple months ago.
(0:14) Is there some corrections being made on making up for the 3.5 deficit? Where are we at this point? (0:21) Well, just to make sure that there’s accuracy, the 3.5 million was a (0:29) journal entry for accounting on bad debt. The hospital has been profitable (0:37) and what it impacted was our cash position. And so where we hit the brakes was on spending (0:46) to make sure that we understood where our cash position was and our day’s cash on hand.
And (0:53) we feel really good. It’s about 90 to 120 days out since we alerted everybody to the situation. (1:04) And we feel really good about how we have stabilized it and the plans that we’ve put in (1:09) place to move in a direction where we get back on that growth initiative that we’ve experienced over (1:17) the last three years.
Okay. So how does it look going out in the future? Are we making the (1:24) corrections that are necessary in the past? The South Lincoln has turned to the county for a while. (1:28) We turned to the county for some assistance along the way.
How does it look kind of, well, (1:34) riding the boat to steadying the waters in the future? Yeah. So I think most people know that (1:40) we have a mill levy associated with our hospital district. And the county has been a great partner, (1:51) not just with us, but also with South Lincoln.
Obviously this upcoming year we’re going to (1:58) receive a 25% reduction in our levy. And so we’re having to adjust our spend. (2:07) Is that through the property tax situation? Because of the property tax (2:10) so where we received about $2 million last fiscal year from the county, we expect somewhere between (2:18) 1.2 and 1.3. And all of that tax levy money has been going to EMS plus another million dollars (2:27) to pay for EMS here in the Valley.
And so part of the changes that we made with EMS was (2:37) in preparation for that reduction. And I know that there’s a lot of concerns about EMS being short (2:45) staffed and it’s not. We’ve met with all of the leaders from Alpine, from Thane, from Afton, (2:53) the county.
They understand our staffing plans. The response times have not dropped. I think (3:01) our EMS providers, they’ve just been remarkable.
But we have to make adjustments in light of the (3:09) changing conditions of where our funding comes from. And again, all that money that we received (3:16) from the county, from the property taxes of the good citizens of Lincoln County, (3:21) are all going towards EMS. Oh, okay.
People didn’t realize that. (3:25) And EMS is in better shape than we thought. I can remember our past, Dr. Perks, I remember (3:32) one time doing an interview with him.
He said, people would pay you to do that job, but the (3:36) culture has changed and we don’t have the volunteerism that we used to have. People want to (3:41) be paid for the job. Yeah, absolutely.
And I think most people that have experienced EMS these last (3:49) three years, they have seen a dramatic improvement in response times, in the training of the EMS. (4:00) And overall, we feel like we’ve gotten it to a good place. Now, the question is going to be, (4:05) how do we sustain that? Right.
And sustain it in a growing valley. It’s not the quiet (4:09) little valley it used to be. There’s more people out there needing services.
(4:12) So we’re bringing all the stakeholders together to make sure that we’re making decisions that (4:16) make sense for at least this part of the county. And so we’re planning on having those conversations (4:26) so that there’s a clear direction as to what that sustainability looks like. (4:34) Okay.
Let’s switch to insurance. There’s been some issues with Cigna. People don’t understand what (4:39) exactly that is.
Could you give us an overview? Yeah. So Cigna is obviously one of the major (4:45) insurance companies for profit in the country. The other three or the other two for profit (4:54) insurance companies that we have contracts with are United Healthcare and Aetna.
And then the (5:00) largest insurance company that we deal with is Blue Cross Blue Shield of Wyoming. They’re not (5:06) for profit. And I’ve mentioned in town hall meeting that we have tried over the last 18 (5:19) months to reach some type of agreement where we know that we’re receiving reimbursement that is (5:29) on par with those other payers that I just mentioned.
United Healthcare, Aetna, and Blue (5:35) Cross Blue Shield of Wyoming. Those three payers, they have agreed with our terms. They understand (5:44) us being a rural hospital trying to provide services in a high inflation area outside of (5:54) Jackson Hole.
And they’ve been very accommodating. And it didn’t take long and we sat down and we (6:01) were able to get agreements with those three. For some reason, we just can’t get agreement with (6:07) Cigna.
Cigna, at least our understanding is that they refuse to have any rate that is not (6:17) on par or better than those other three. And we recognize that they’re still an important partner, (6:27) but they’re a very small part of our business compared to Blue Cross Blue Shield of Wyoming (6:33) and the other two. And so we have tried to figure out is there any sliver of amount that they would (6:45) agree to that they would feel comfortable signing an agreement.
And it’s my understanding that from (6:56) a national level, there is a directive that they have the best rate in the market. And we can’t go (7:04) that low. In a place that has a high cost of living.
It has a high cost of living. And so (7:12) for our sustainability, those managed care contracts are very, very important because (7:19) commercial insurance actually subsidizes Medicaid and Medicare for a hospital in a physician office. (7:28) Medicare and Medicaid, they don’t even pay what it costs to provide services.
And so we rely on (7:40) favorable insurance rates to make up the difference and to reinvest into the facility, (7:49) provide raises to our staff and be able to have some type of growth initiatives. (7:57) So it’s unfortunate that it came to a termination. I am always willing to (8:05) have a discussion with them.
I’ve asked that we meet in person. There’s got to be some way that (8:12) they recognize that we’re still an important partner for the many people that do rely on (8:18) Cigna here in the western side of the state. I know that they have a significant presence (8:24) on the eastern side of the state.
And I think that’s part of the disparity and misunderstanding (8:32) that we’re having. But we want a win-win. And unless we can get to a win-win, (8:43) unfortunately, it’s at an impasse.
There may be some possibilities of (8:47) still coming back together in the future. Oh, absolutely. It’s all about who’s at the (8:54) negotiating table and who can actually work through some of these issues.
And (9:00) we’ve warned them that this is going to be the result. But I think that the people that we’re (9:06) even talking to, their hands might be tied. Because it’s such a big situation.
(9:13) From a national directive, right? And so I think that’s very unfortunate. (9:18) Well, while we have you, anything else you’d like to add in general about Star Valley Health? (9:22) Dan Ordena, CEO of Star Valley Health. We appreciate the fantastic support of the (9:29) community.
We recognize that there have been some recent headwinds. And what it’s allowed is for us (9:40) to really look at various aspects of our business, get better, improve, and provide focus. And we (9:50) want to be here for the community.
And we want to make sure that we’re providing exceptional care. (9:57) And everybody within Star Valley Health is committed to providing compassionate (10:02) care to every person, every time. And that really is our mission and our purpose.
(10:09) But we obviously can’t do that without the community support. And we appreciate them (10:15) helping us through these headwinds. And we’re going to be better for it.
(10:24) Thank you, Dan Ordena, CEO of Star Valley Health. Dan Dockstader, (10:28) at Star Valley Health Today for SVI Media.