CEO facing challenge of financing new construction, operating current facility
By Andrew Lawson (published in the Arkansas City Traveler 12/9/10)
Although South Central Kansas Medical Center CEO Steve Perkins has made a lot of progress since he moved to Arkansas City, there's still much work to be done.
"I've only been on the job seven months," Perkins, who was hired in March, said at a City Commission meeting Tuesday night.
"There were a lot of issues sitting on my desk when I arrived that need to be dealt with."
One of those is the challenge of financing the construction of a new hospital while simultaneously operating the current hospital.
The commissioners gave him invaluable assistance to meet that challenge when they voted unanimously to reimburse the hospital's coffers for the two bond interest payments it made this year.
The payments were $757,274 each, for a total of $1,514,547. The money will come from a reserve fund into which proceeds from a half-cent sales tax approved by Ark City voters in November 2008 have been deposited.
Also available is $124,387 from the sale of land on Birch Avenue to Braum's.
Given that the fund was established for this very contingency, discussion of the action item was noncontroversial. Most of Perkin's report centered on hospital operations and the timeline of moving into the new building.
Regarding the cash-flow issues that had resulted from the hospital's accounts receivable, Perkins said things were picking up.
"I was reviewing accounts receivable this week and there's really nice inflow," he said. "Presently, our acounts receivable gross is approximately $5.4 million. We're hoping to get them under $4 million. We're making really good progress."
Perkins said SCKMC had launched a new program through which any customers who have worked with the hospital to set up a regular payment program will have their balance cut in half if they agree to repay the remainder by the end of the year.
"We had eight calls on the first day," and even those who could not make it work were appreciative of the hospital's efforts, he said.
Perkins also detailed what will go into the move from the old building, on First Street and Birch Avenue, to the new campus in Patterson Park Subdivision, two miles north of town.
"We've been working with a mover and requested at least three or four proposals," he said. "We really hope to compress the real move into about three days."
Not including hospital staff overtime, Perkins said, the move is estimated to cost somewhere "in the neighborhood of $30,000 to $35,000."
There also will be vendors needed to calibrate the specialized equipment the hospital will have. "We're not equipped to do those calibrations," he said.
A final topic of discussion was promotional efforts for the new hospital services.
"How are you going to sell it to the public, other than, 'We've got new stuff'?" asked Commissioner Jay Warren.
Perkins has said he is counting on the new facility to generate additional revenue by providing pre- and post- operation services for which people currently have to travel to Wichita. Education is paramount in that effort.
He described the thought process he wants to promote in ark City: "You're sending me to Wichita for this, but I read it can be done here. I don't want to go to Wichita."
Getting there will be a comprohensive endeavor. "Physicians will be making decisions to suggest where patients receive care," Perkins said. "We have to let the public know it's available. It's like the psychology of drug ads on TV."
He said the education process will be coordinated, including news releases, interviews and advertising, and will rely heavily on the hospital's new web site.
The web site is important, he said, because it is "used so much for medical decision-making," especially by relatives of Ark Citians "who hop on and research the site," looking for care for their loved ones.
It's alos the first "face" the hospital shows to the physicians it's recruiting, he said.
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