Maverick County Hospital District Board approves 2016 Audit with $3 Million Operating Loss & $1 Million Annual Loss

By: Miguel Munoz, Eagle Pass Business Journal, Inc., Copyright 2017

Another fiscal year, another million dollar loss sustained by the taxpayer-owned Maverick County Hospital District.  The Maverick County Hospital District Board of Directors approved the District’s 2016 Annual Audit Report with an astonishing $3,013,355 (Million) Operating Loss and a $1,083,124 (Million) Annual Loss for the fiscal year from September 1, 2015 through August 31, 2016 at their regular meeting held on Tuesday, February 28, 2017.

Agenda item No. VI-A regarding the discussion and acceptance of the Maverick County Hospital District FYE 2016 Annual Independent Fiscal Audit was moved ahead of the agenda after the Visitor Recognition to allow Chris Clark of BKD, LLP to present the draft of the District’s 2016 Annual Independent Fiscal Audit to the Board of Directors.  Clark advised the MCHD Board of Directors that the Hospital District suffered an operating loss in 2016 of $3,013,355 (Million) and an overall annual loss (net position decrease) of $1,079,749 (Million).  Clark told the local Hospital District Board of Directors that risk areas in the 2016 Audit reviewed by the Certified Public Accountant firm included the Patient Account Receivables, Property Tax Collection Reports, and the District’s Net Pension Asset Report.

The Hospital District had total operating expenses of $6,201,588 (Million) compared to only $3,188,233 (Million) in total operating revenues, causing a $3,013,355 (Million) total operating expenses loss during the 2015-2016 fiscal year.  The $3,013,355 (Million) operating loss was partially offset by the Hospital District’s total non-operating revenues, including property taxes, investment income, and grants, of $1,933,606 (Million) for a total loss of $1,079,749 (Million) for the 2015-2016 fiscal year.  Clark told the Hospital District’s Board of Directors that BKD, LLP was issuing an Unqualified Opinion (Clean Opinion) on the District’s 2016 Annual Audit Report.

After Clark’s presentation to the District’s Board, Board member Jesus Casas, a Certified Public Accountant, noted that according to the 2016 Annual Audit Report draft reflects that the Hospital District has a surplus in its Employee Net Pension Assets.  Other than Casas’ comment that the District has contributed more than necessary to fund its Employee Pension Fund, no MCHD Board member made any comments or raised any questions or concerns regarding the 2016 Annual Audit Report draft reflecting the $3,013,355 (Million) total operating loss and the $1,079,749 (Million) total loss during the 2015-2016 fiscal year under the leadership of former Board Chairman Juan Manuel “”Chuco” Farias.  Without any additional Board members’ comment or questions, Board member Jesus Casas made the motion to approve the Hospital District’s 2016 Annual Audit Report, seconded by Board member Rebecca Robinson.  The Hospital District Board approved the 2016 Annual Audit Report very quietly and with a lack of public comments or questions.

The MCHD 2016 Annual Audit Report is a public record and is now available to any person from the MCHD under the Texas Public Information Act.  The Eagle Pass Business Journal will request a copy of the MCHD 2016 Annual Audit Report to review it and report on how the Hospital District lost another $1,079,749 (Million) during the 2015-2016 fiscal year.

The MCHD 2016 total loss was minimized by the District’s sale of its real property on Bibb Avenue which brought in approximately $318,000 in non-operating revenues and the resignation of Orthopedist Dr. Gloria Box which saved the District several months of salary expense; otherwise, the total loss for the 2016 fiscal year would have been significantly greater than the $1,079,749 (Million).

During the Presentation of Financial Reports agenda item,  Board Vice-Chairman Jesus Casas noted that this was the 15th consecutive year that the MCHD has sustained a million dollar plus loss while Chief Executive Officer Terri Contreras-Patlan stated that at least the past 10 years in reply to a question by Casas.  Casas noted that the Hospital District has to make changes in order to raise revenues and stop suffering annual million dollar losses, echoing the recommendations of former Board member Ricardo E. Calderon during the past four years which went unheeded.  Like Calderon, Casas advised the MCHD Board and Administration that the District’s Reserve Funds will not last forever if the District continues to sustain annual million dollar plus losses without making changes.

In other business, the Hospital District approved CEO Terri Contreras-Patlan’s Marketing Plan with a modification to add a total of $5,000 from current budget line items to be able to purchase advertising in local newspapers and news media; tabled a proposed Community Needs Assessment Study by Dr. Larry Morningstar and several associates after taking it into Closed Session; appointed Ruben Carrillo, Jr. as the Lay Person representative of the newly reconstituted Fort Duncan Regional Medical Center Advisory Committee in a split vote of 4-1 after two voting sessions over other nominees, including Enrique Montalvo, Ronnie Rivera, George Garza, and Dr. Jonathan Hook; authorized CEO Terri Contreras-Patlan to do a Scope of Work Plan for Medical and Healthcare Practice Management Assessment for the Physician Specialty Group Practice in order to request proposals from management firms on how to increase revenues in the annually money-losing specialists clinic; and heard presentations from Chief Finance Officer Nestor Bonilla for the month of January 2017 and that the Hospital District had suffered a $164,415 loss during the month as well as from the Physician Specialty Group by Clinic Manager Monica Nandin, the Ryan White HIV-AIDS Program by Director Marcos Trevino, the Teen Pregnancy Prevention Program by Coordinator Marlene Ramirez, and CEO Terri Contreras-Patlan’s Administration Report.

CEO Terri Contreras-Patlan announced that the Physician Specialty Group will have a new Orthopedic Doctor coming aboard in April 2017 to provide specialist medical services to the community.

Also on the agenda under both Executive Session and Open Session were the discussion and update with possible action regarding the Uncompensated Care agreement with Fort Duncan Regional Medical Center and its parent company, United Health Services, Inc; discussion and update with possible action regarding the Maverick County Hospital District Medical Office Building Lease Agreement with Fort Duncan Regional Medical Center and its parent company, United Health Service, Inc.; and discussion and update regarding Physician Recruitment.

The Eagle Pass Business Journal has noticed that the MCHD Board of Directors has posted two agenda items for discussion and possible action for several continuous months regarding Fort Duncan Regional Medical Center and its parent company, United Health Services, Inc., specifically the Uncompensated Care Agreement and the MCHD Medical Building Lease Agreement.  It is apparent from the agenda items that the MCHD and Fort Duncan Regional Medical Center and its parent company, United Health Services, Inc., are in some type of negotiations on these items, but their status is unknown to the public as they are being discussed in Closed Session in consultation with Legal Counsel and no public action has been taken in Open Session.  Maverick County taxpayers are totally without or a lack of public information regarding these agenda items.

The MCHD Board of Directors is composed of Chairman Adolfo “Fito” Olivares, Vice-Chairman Jesus Casas, Secretary-Treasurer Rebecca “Becky” Robinson, and Board members Ronald Hixson and Juan Manuel “Chuco” Farias.