KINGMAN – The Board of Directors of the HDOMC (Hospital District Number One of Mohave County) on August 29, approved an IGA (Intergovernmental Agreement) with KRMC (Kingman Regional Medical Center) to provide matching funds of $2.3 million for an AHCCCS (Arizona Health Cost Containment System) program, APSI (Access to Professional Services Initiative).
According the AHCCCS website, this program provides “enhanced support to certain professionals,” and aims to “preserve and enhance access to these professionals who deliver essential services to Medicaid recipients in Arizona.”
The IGA requires the Hospital District Board to pay $2,360,010 which includes $90,760 for “administrative fees.” It is unclear who will administer the contract or to whom the admin money will be paid. Payments to AHCCCS of $453,850 will begin on November 1, 2024 and continue in February, May and August of 2025 with a final payment on August 1, 2026 according to the contract. All local matching funds must be from the hospital district with no formal or informal agreements between the board and hospital for the direct or indirect return of funds to the district.
According to Josh Hoffman, CFO (Chief Financial Officer) for KRMC, said more money will come in to the hospital for services from AHCCCS because AHCCCS doesn’t pay enough to cover the hospital’s cost. “So, you know, we’ve been told initially that it’s looking like a little over $9 million … that we could bring to Kingman,” said Hoffman.
Hoffman stated they are working to recruit additional physicians and there are 30 graduate students (residents) in the agency programs, primarily at the Santa Rosa family practice. With an increased demand for family practice physicians, Hoffman said if it is difficult to get patients into family care they can be placed into the resident clinic.
On July 9 the Board also approved a $1 million IGA with KRMC for the AHCCCS GME (Graduate Medical Education) program. This was budgeted for in March due to an unexpected increase. The Board approved an additional 350,649 at the special August 1st meeting.
According to the AHCCCS website, hospitals with GME programs are able to receive reimbursement for expenses related to that program. The funds can be utilized to assist with stipends, staff salaries and benefits and any overhead associated with the GME program that is “facilitated by the hospital.” State statutes allow for “voluntary” matching funds to be used to increase the federal match.
Upon inquiry regarding whether the district board has or will have cash on hand to pay for these IGAs, Board Chair Penny Holden stated that although the most recent $2,360,010 is not currently budgeted or in the spreadsheets, she and Hoffman met and reviewed the funds that may be available.
“We’re going back to negotiate the lease amount from the hospital to make sure everything’s covered; and (that) we’ve got everything financially covered for this year all the way through mid-next year,” stated Holden. “So far … we have the money it’s just not in the budget.”
She further added that, “What people don’t understand is that GME was never available to rural hospitals until the last 60 days…and that’s why rural hospitals are jumping on it to get the money.”
When asked about the renegotiation of the hospital lease, board members Newmyer, Valentine and French were unaware that the lease amount was being renegotiated. French said that it is premature and he knows they can cover it.
“(We) never failed to before. It goes its way every year,” he said. I was on the other (KHI) board for the hospital for 36 years. I’m kind of familiar with how it works, but I was on the other end of it then.”
Valentine, stated he was absent at both August meetings due being refused zoom or hardwired telephonic access rather than an unreliable cell signal to attend the meeting. He was unable to attend in person so, without reliable telephonic access, he did not vote. As to renegotiation of the lease amount, he said, “Who is we? She is not the board; she is one person … that’s the first time I’ve heard about that. I had no idea.”
There was no contact information readily available for board member Mathieson.
On July 1, 2020, lease income was $3.6 million annually; in 2021 it decreased to $2.4 million; and is slated to further decrease to $1.2 million in July, 2025. Except for investment income, the lease payment is the only income the district has. The district’s fiscal year ended on June 30, 2024. However, it is unclear as to the status of funds on hand as the balance sheets for June, July and August were not available at the time of publication.
Becky Foster
