MercyOne Elkader CEO addresses pandemic and being a rural hospital

By Willis Patenaude, Times-Register

Born out of community need in the 1960s, the MercyOne Elkader Medical Center is the third smallest rural hospital in the state, which presents a unique set of challenges. 

One of those challenges was overcome in 2018, when the previously independent hospital was acquired by MercyOne, a decision that was prompted by a perceptible look at the market, the ongoing changes in healthcare and to make the hospital less vulnerable to the unforeseen. With the power of hindsight, the decision seems rather prophetic given the COVID-19 pandemic. 

According to the hospital’s chief executive officer, Brooke Kensinger, part of the MercyOne decision was due to a long look down the road at the sustainability of independent hospitals, access to resources, basic economics and the lower cost of inventory. 

This was never more evident than during the COVID crisis, when other small, independent rural hospitals struggled with patient intake and supply issues, while the association with MercyOne actually made it easier to obtain those materials. 

But it wasn’t just the name that made the hospital endure during the pandemic; it was situational awareness and preparedness. In the early days, the hospital held emergency meetings to address possible situations and they developed a plan for many “what-if” scenarios. 

One of them was what to do if the hospital reached capacity due to infections. The solution was a partnership with Strawberry Lutheran Home—using the facility to put patients if needed. 

“We wanted to have a place for people to go,” Kensinger said. 

MercyOne also constantly checked the CDC data, looked at the ever-changing protocols and worked to use staff efficiently to keep both staff and patients as safe as possible. 

But even with the MercyOne distinction and greater access to resources, there were challenges and difficulties. 

One of them was a lack of specialists and that Elkader is not an infectious disease hospital, but having MercyOne gave Elkader access to webinars with such experts in Dubuque and Des Moines. 

Another challenge was the evolving changes in information, which seemed to happen daily. 

“The daily changes made it difficult. What was the stance of the day going to be? And the politicization of masks. That noise wasn’t helpful,” Kensinger said. 

Another impressive feat was the fact that, during the pandemic, the hospital didn’t layoff a single employee. There was also no reduction in staff.

“The hospital is so small that people wear multiple hats,” Kensinger said. 

But what is it like serving a rural community and balancing the need for profits versus patient care to remain viable? According to Kensinger, one thing that helps the hospital is that it has zero debt and no shareholders to answer to. It’s also financially intelligent when it comes to investing in the hospital and the community. Everything the hospital make in terms of the operating margin is reinvested. 

Much of that reinvestment has happened in the last five years. Since 2016, the hospital has purchased ambulance equipment, a chemistry machine for the lab department, hired paramedics, purchased a new ambulance, upgraded technology in radiology and in the mammography unit, bought a mobile X-ray unit, put in new HVAC units and replaced patient beds and hospital furniture. 

“The hospital team works very hard to keep innovating in the services that we are able to provide to the community.  In the past couple years, we have added respiratory therapy, pulmonary function testing and home sleep studies. Adding services, and ultimately revenue, helps the hospital maintain a healthy operating margin so that we can keep reinvesting in the hospital and sustain services that historically are not as profitable, like the EMS,” Kensinger said. 

The hospital team is also mindful of expenses and are good stewards of funds, so the hospital can continue to have a healthy operating margin. 

“We have to make money to keep investing to stay relevant to stay here, but there is a balance, and we are prudent and creative and put thought into our spending,” added Kensinger. “We’re not here to make crazy margins. We’re here to take care of the community.”

This investment is meant to cater to a rural clientele with specific health needs, such as injuries associated with farming, outdoor recreation accidents, sports injuries and elderly falls. 

Kensinger is looking at even more investment—investment to overcome the lack of space and the limit it puts on expansion. One expansion she would like to see, which is currently in the planning stage, is establishing a visiting specialist clinic so the community can have some access to the specialist they need right in town, rather than driving elsewhere. 

And while there is nothing planned now, Kensinger also mentioned a very long-term goal of potentially building a new, bigger hospital. She said a lack of investment, the changing reimbursement landscape and the risk involved make this unlikely in the near-term, however. 

Now, while MercyOne is thriving, even during a pandemic, other small rural hospitals are not. Kensinger owed this to the fact they “have less of a voice.” 

Smaller rural hospitals also face greater financial viability issues with how operating margins have changed and how the government decides to pay them. Some of the failure is a result of operating inefficiently and being unable to adapt old ways to newer technology. 

She said none of this is a problem for MercyOne Elkader because of the 2018 decision that benefited both the hospital and the community.