Five days after formally asking the Sonoma Valley Hospital board of directors to shut obstetrics for financial reasons, administrators are temporarily withdrawing the request due to a new development.
“The hospital has learned that the Medicare funding supporting the program, which was cut in October 2013 and precipitated a reassessment of this program, has been restored,” administrators said Wednesday in a prepared statement.
That funding comes from the Disproportionate Share Hospital program, or DSH (pronounced “dish”), a part of the Affordable Care Act. The program sets aside billions for hospitals treating a high percentage of low-income patients – as Sonoma Valley Hospital does – and it was taken away then reinstated recently during the twists and turns of Obama-care implementation.
For this reason, hospital CEO Kelly Mather – who made the case for closing obstetrics at the board’s regular meeting on Thursday, Jan. 9 – is now asking the board to put off any decision for a few months.
“Now that DSH funds, which have underwritten a large part of the cost of the hospital’s obstetrics program in recent years, have been restored, this gives us some breathing room to explore options to continue the services,” Mather said in the statement.
Speaking on the phone Wednesday, Mather noted that her office actually found out about the restoration of funds a few days before the Thursday meeting, yet “I still felt like we needed to go forward” with the request at the time. But she added, “I did expect that we might recommend a delay.” (The fate of DSH funds, and what that means for obstetrics, was discussed by Mather and board members during the Jan. 9 meeting.)
“The money went away Sept. 30. There was nothing, no indication, that any legislation would get passed at that point to restore the money,” Mather said. That meant a projected loss of $86,000 per month for the underutilized maternity ward – “over a million-dollar loss” per year, Mather said. “And we just can’t do that.”
But with DSH funds restoring about half of that cash, Mather said she felt comfortable taking a wait-and-see approach – especially since it’s the inpatient numbers from obstetrics that tip the scales and let Sonoma Valley Hospital receive DSH funds in the first place.
“We would not qualify for this extra payment if we did not have OB,” Mather explained. For this reason, administrators have opted to give all the DSH funds to obstetrics.
But they don’t plan to wait too long: “I’m going to give it up to nine months,” Mather said. “If it doesn’t go down to 250 or less” – meaning, if the yearly loss from obstetrics doesn’t fall to $250,000 or less – “we’re going to recommend (closing) it again. Because I can’t keep funding OB
at the risk of losing services.”
Declining birth rates have taken a toll at many community hospitals, and Sonoma Valley is no exception. The hospital says it averages 12 or 13 births a month, but would need twice that for the obstetrics unit to break even.
Cameron McKesson, a Sonoma resident who was among several expectant mothers speaking out on the issue at last week’s meeting, said she was cautiously optimistic that obstetrics could stay open for the long term.