Aspen Valley Hospital: Critical Difference - Health Executive - RedCoat Publishing - Inside Healthcare

Aspen Valley Hospital represents the best of two worlds: the warmth and friendliness of a small town and the technical expertise of a major medical center. The catch? It’s a 25-bed critical access hospital. And although the hospital is in a solid financial position today, four years ago, a stressed billing and collection process threatened to overshadow the hospital’s 115-year history.

“In the early 2000s, we had interruptions in our billing and collection process that caused our receivables to get out of hand,” said CEO Dave Ressler. “We experienced $8.5 million in loss over three years, which resulted in our board engineering a transition in the hospital’s executive leadership.”

Dave Ressler, CEO

In 2004, along with a new CFO, the board appointed Ressler CEO. Since then, the hospital has restored its cash position to about 220 days cash on hand, the equivalent of $30 million, and the hospital has been profitable since 2005. The change was simple enough, said Ressler, and stemmed from a decision to outsource.

“Outsourcing is a key consideration for any small community hospital with a limited ability to acquire the expertise necessary to meet the complexities of the billing operations,” said Ressler. “That’s been the key to our success.”

Turning it around
Colorado-based Aspen Valley Hospital is located in one of the most expensive areas in the country, with starter homes ranging from between $1.5 million and $2 million. Because of the high cost of living, the hospital had previously tried to operate a billing office with local staff roughly an hour away but was unsuccessful. The pool of candidates were not experienced enough with hospital billing, let alone starting out years behind the ball.

“We had such a large number of receivables that had accumulated over time. We had to not only keep up with our current cash flow needs but also alleviate the backlog,” said Ressler. “We began working with First Consulting Group (FCG) with the intent of outsourcing our revenue cycle including our billing and collections.”

California-based FCG was proficient with Aspen Valley’s Meditech system. Through initial conversations, Ressler and his team discovered that before they could tackle their billing issues, they needed to upgrade their IT. After working with the hospital on its IT upgrades, FCG transitioned the hospital’s billing office to one of its partners, MedAssist.

In the year that Aspen Valley worked with FCG, there were so many system fixes needed that the hospital didn’t realize the benefits inherent to outsourcing. However, after switching over to MedAssist, it saw an almost immediate collection of its current receivables.

Master plan
Once the hospital moved from questioning its viability to stabilizing its finances to financially thriving, the administration began looking into master facilities plans that had been on hold since the late ’90s. In 2005, the team refocused on capital investments and facility upgrades and began the first of a four-phase master facilities plan expansion.

For phase one, the hospital is honing in on its OB department and nursery, increasing its size from 3,000 square feet to 9,000 square feet and the number of LDRs from three to nine. The department’s original 3,000 square feet is also being renovated. The 6,000-square-foot build out should be completed at the end of April, with the entire first phase wrapping up in August. But that’s just a small piece of the entire 20-year vision.

“We’ve preliminarily assigned a price tag of $100 million to the three remaining phases,” said Ressler. “It’s been a dream of the hospital and the community to bring our 1977 facility up to current standards, and now we’re living that dream.”

As with many hospitals built in the 1970s, Aspen Valley’s layout is geared to an inpatient population but without the enhanced privacy that inpatients expect today. As a result, the second phase of the hospital’s master facilities plan includes upgrading to private patient rooms and increasing the number of patient rooms to 40. It also includes a three-story parking garage.

“The parking structure is important because it creates the capacity for us to build onto what is currently surface parking,” said Ressler. “The second phase will also include expanding our cardiac rehab and physical therapy departments and increasing our medical office space so our physicians can move onto the campus.”

The third phase will include a new ED and radiology department, as well as an expansion of the hospital’s surgical department. In addition, the hospital is moving its helipad directly above the ED and adding an elevator. Once that work is completed, the administration will begin the fourth phase of the master facilities plan, which includes renovating the existing space and creating a new front entrance.

Long-term commitment
Unlike other hospitals going through a master facilities upgrade, Aspen Valley’s plan is not based entirely on service growth. “We’re decompressing our existing space to accommodate our current scope of services with some volume increases,” said Ressler. “We’re looking at a 20-year time horizon for our master facilities plan to serve our community.”

The vision fits in well with the hospital’s desire to partner a small-town feel with a facility that reflects state-of-the-art capabilities. The hospital’s PACS, 64-slice CT, 1.5 Tesla MRI magnet, and nuclear medicine capabilities exude the technological capabilities of a larger facility, but its plan to grow to only 40 beds shows a commitment to keeping its culture personal enough to provide a unique patient experience.

“Notwithstanding the difficulties we experienced a few years ago with our revenue cycle, the hospital has enjoyed many years of being a very high quality and personalized care provider with a high level of technology,” said Ressler. “This isn’t something new; this is something that we’re well reputed for and will continue to demonstrate long term.”

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