“It has been a great pleasure and privilege for me to work with HFS. They are one of the best consultants we have.”
–Office of Statewide Health Planning and Development (OSHPD)
Access to Care Section Chief, Konder Chung Healthcare Workforce Development Division
In February 2013, the board of directors of Palo Verde Hospital, a 51-bed acute care District Hospital in Blythe, California, contacted HFS to conduct an operational assessment. The hospital had been losing substantial amounts of money over a two-year period, and was close to losing its accreditation. Hospital executives did not have a plan to become profitable. It was expected that the hospital would run out of money within four months.
The assessment was completed in May 2013. It was estimated that operations could be improved in the $8 million to $11 million range, and by fiscal year end June 2015 achieve a profit of approximately $750,000.
It was also projected that if nothing were implemented, the hospital could not survive and would experience a deficit cash position in early FY 2014 and lose over $7 million annually by FY 2015.
Just after the assessment was started, the hospital’s management team experienced a shake up, requiring the placement of HFS’s Larry Blitz as interim CEO for approximately six months, and Richard Gianello as interim CFO. Subsequently, Sandy Anaya was hired to replace Larry Blitz as the permanent CEO, and to collaborate with HFS on the improvement plan. Gianello has continued as interim CFO, serving in an oversight role, and is available to bring in resources when needed.
The assessment implementation brought on numerous challenges including:
Hospital management and HFS met the challenges together, working as a team. There was ongoing communication and education, resulting in increased trust and improving the hospital’s image internally and to the community.
The following areas were identified for improvement:
HFS identified the areas of improvement and worked as a team with hospital management to pinpoint which areas the hospital could implement and those where it needed HFS’s support.
"HFS Consultants worked with key members of our hospital team to help design and execute strategies that helped lead us to increased financial stability, innovative program design, and streamlined operations. They have the capabilities to help drive transformation and provide practical solutions to complex problems. The breadth of the “hands-on” knowledge of strategic change management was just what our organization needed during a pivotal time."
-Sandra J. Anaya, MSHA, BSN, RN, CPHQ, HACP CEO, Palo Verde Hospital
HFS had projected that if the hospital implemented the assessment’s recommendations, the hospital could achieve a profit of approximately $750,000 by June 2015. Although the 2015 estimate was not achieved, the hospital ended up with a profit of just under $400,000. HFS, working together with the hospital board, CEO, Sandy Anaya, Assistant CFO, Christa Rohde and other hospital staff successfully took the troubled Palo Verde Hospital, which had lost approximately $5 million per year in 2012 and 2013 to a better than break-even point by FY ended June 2015. Currently the hospital has a cash reserve of approximately $5.1 million, and thanks to the work of Sandy Anaya, accreditation from DNV.
For information on HFS’s services and turnaround strategies, contact Richard Gianello at 510-768-0066, or email@example.com.