Gov. Juan F. Luis Hospital Chief Executive Officer Kendall Griffith is contesting the decision by the Centers for Medicaid and Medicare Services to decertify the hospital, but during a news conference Friday he gave few details on CMS’ decision or plans to address it.
CMS notified the hospital on Thursday that it will terminate the Gov. Juan F. Luis Hospital’s participation in the federal health programs effective Oct. 9, so that neither Medicare nor Medicaid will reimburse it for care. The hospital is already unable to pay many of its vendors, is millions of dollars behind on employee taxes and pension payments, and has not paid an electric bill in years. It has needed emergency bonding legislation and cash advances to meet payroll this year, and is ill-prepared to absorb a large financial shock.
Following a 2011 CMS inspection, the hospital was found deficient in 11 of 23 categories. In December 2011, the hospital entered into an improvement agreement with CMS.
Griffith, during Friday’s news conference, began reading a prepared statement nearly identical to one he released in audio form Thursday, saying he "can honestly say the decision to decertify Juan Luis is not based on a true or accurate picture of the hospital" and it "is not reflective of the hard work and dedication that is displayed by the staff and the physicians of the hospital."
Griffith suggested the CMS decision was incorrect because the report covered a broader period of time than he had been informed, prior to a CMS inspection tour in July.
"We were informed there would be a new survey only reflecting recent events," Griffith said, citing the time period he had been told. "But the report includes events from 2011 to 2014. Thus, there is no justification for decertification, therefore we will appeal this decision," he said.
Griffith went on to give a detailed list of areas the hospital had improved on "despite our fiscal challenges." He said finances, while bad, were improving.
"We stopped the financial team and we are in the process of reconstructing the financial team and … are seeing increasing collections in every month beginning in June," he said.
In April, cash collections were around $2 million, while in August they were $4.2 million and holding at that level in September, he said.
Griffith terminated former Chief Financial Officer Deepak Bansal and his assistants in late 2013, after an acrimonious dispute (See Related Links below). Shortly before terminating Bansal, Griffith resigned as interim CEO amidst a conflict with Bansal, his assistants, and with several members of the JFL governing board. The board reinstated him after the Legislature scheduled a session, at Sen. Alicia "Chucky" Hansen’s urging, to consider reinstating him as hospital CEO by legislative fiat (See Related Links below).
When asked what would happen if the attempted appeal was unsuccessful, Griffith at first emphasized that it would be and had to be successful. Then, when pressed, he said if payments ceased altogether "the hospital will not shut down. We will not close. We will continue operations as is, because we have a mandate to provide care for all regardless of ability to pay."
Griffith ignored questions about what happens to patient care if payroll cannot be met. He said that money from other sources would continue and operations at the hospital would continue. He also emphasized that CMS would still be reimbursing the hospital for all care given until Oct. 9, and that if it is cut off, the hospital could still be reinstated and potentially be reimbursed retroactively.
If the appeal is not successful, it would be 120 days before another appeal could be filed, Griffith said.
Asked about the potential fiscal impact of CMS’ decision on their finances, Griffith said they were still working on the detailed picture. "But what I can tell you now is that the potential financial implication is about $13 million over the next six months," he said. That amounts to $26 million a year. For context, that is more than the total $20.1 million, V.I. government appropriation to Juan Luis for fiscal year 2015. However, it is only a portion of patient revenues. During budget hearings, officials testified the hospital expects $126.7 million in gross patient revenues, with $41.5 million left after "contractual adjustments" to pay doctors and other costs, for local revenue of $77.63 million in the next year.
Griffith also said he was in talks with the governor, delegate to Congress and Legislature about any avenues for emergency funding. But the V.I. government budget is already tight this year, after several consecutive years of decreased revenues.
When asked for a copy of the CMS report, Griffith said, "CMS has informed us the report will be available the 24th or 25th" of September, or in about a week. When asked at the end of the conference why they could not release the copy he had, Griffith did not answer. Later, his assistant Samuel Baptiste said the hospital was not able to release it before CMS because it "is the property of CMS." When asked if CMS had directed the hospital not to release the report, Baptiste did not answer but repeated that it belonged to CMS.
When Juan Luis’ governing board hired Griffith’s predecessor, then-CEO Jeff Nelson in 2011, the hospital was facing severe financial difficulties and intense scrutiny from CMS.
Board members at the time cited Nelson’s experience as a "turn-around" expert who specialized in temporarily taking the helm of financially troubled health care facilities, making unpopular changes and putting them on a sustainable path, then leaving to the next job.
Nelson came under intense criticism from board members, staff and the V.I. Legislature after the hospital laid off 85 licensed practical nurses and certified nurses assistants on Feb. 28, 2012. At the time, Hansen publicly urged Nelson’s ouster. The board ousted Nelson, directing him to resign, in January of 2013. Griffith, then the head of the V.I. Cardiac Center at the hospital, was appointed interim CEO.
Asked Friday if the decision to oust Nelson had hastened, delayed or had any effect on CMS’ decision to decertify the hospital, Griffith said, "his actions predate my presence so I can’t really speak to decisions prior to this time."
Griffith took two questions each from four reporters, then left.
Several Senate candidates who were in the audience at the news conference said they were not reassured and hoped to see more information soon.
"I came for more specific and they weren’t there," said former Sen. Neville James. He said he sympathized with Griffith’s situation and supported the hospital. "I think Dr. Griffith is trying to be politically correct and not create any panic that could make things worse," James said. Seniors on Medicare who need the hospital are who really need assurances, he said.
Former Sen. Almando "Rocky" Liburd said he came away concerned. "I wanted to see a plan: Where are we, what do we need to fix. I don’t see a plan," he said.
Former Police Commissioner Novelle Francis also said he wanted to hear more specifics about the response. "Are we in a state of emergency?" he asked.
Junior high school principal Kurt Vialet also said he wanted to see plans and was concerned that Griffith placed too much emphasis on what was alright and not enough on what needed to be fixed.
"Why was there a list of everything going well at the hospital? He needs a plan of correction and that is what I thought I was going to hear. You have to accept that there are problems. Don’t try to justify it or you are just going to get the same result," Vialet said.
