Letson/My Turn:Unhealthy campaign
When I moved to New England and to Greenfield in 1975, I learned about New Englanders’ reticence about mentioning money, income levels or possible gifts to charities. In addition, I have been deeply moved by the generous response the community has given to support United Way, Greenfield Community College and many other worthy agencies. Together we have funded a broad range of important social and educational efforts where we know how our gifts will be used to benefit the larger community.
I well remember the kick-off of the Second Century campaign of Franklin Medical Center when officials announced a goal of $5.5 million to help fund the projects: complete renovation of the Emergency and Radiology departments and renovations of the inpatient Medical-Surgical and Intensive Care Units (upgrading all rooms to private and semi-private. The community stepped up to the plate and gave generously to make that plan a reality.
I also remember that many other very worthy campaigns had a difficult time in reaching their goals for 2006-2007 (United Way, GCC, etc.). There were only a limited amount of available dollars from our families and local funding bodies. I was aware of the challenges in my own decisions that year: Where should I place my own donations? Tough choices were made.
Now, in 2013, Franklin Medical Center is now Baystate Franklin Medical Center (BFMC), and it is going forward with purchasing the Holy Trinity School property on North Street for constructing doctors’ offices, etc. We all welcome this plan and hope it can be carried out. My concern is that BFMC has also announced that it will initiate a fund drive. The situation has changed dramatically since 2006. Baystate Franklin Medical Center is now under the parent company, Baystate Health Inc. I looked at the overall assets of this organization.
The following is a taken from a recent financial report by Nykole Roche (strategic researcher, Massachusetts Nurses Association):
“By all standards, Baystate Medical Center (BMC) is profitable and solvent. Since FY08, Baystate Medical Center‘s operating and total margins have been well above average, with a slight decline in FY11, which may be partially explained by Baystate Health CFO, David Chalke, who insisted the margin took a hit because of ‘lower than expected inpatient hospital volume and a decline in payment rates.’” (“A message from David W. Chalke,” Baystate Health 2011 Annual Report)
“In 2012, BMC’s operating margin was more than twice the average in Massachusetts and the Northeast at 5.6 percent, or nearly $56 million. Its total margin was 9.94 percent ($97.6 million). And three quarters into FY13, BMC is posting a 6.38 percent ($48 million) operating margin, and a total margin that is twice what it was at the end of FY11.
“Measures of BMC’s liquidity are also positive. BMC’s current ratio shows that the hospital could pay its current bills three times over. The number of days it takes for BMC to collect payments and make payments is average and has remained steady.
“BMC’s debt service coverage in FY12 was 8.4, which means that the hospital is more than able to pay principal and interest payments on long-term debt, and its equity financing in FY12 and FY13Q3 (44.6 percent and 44.2 percent, respectively) was average when compared with the state and regional averages.
“Finally, Baystate has significant total net assets ($554.8 million by the third quarter of FY13) and assets whose use is limited ($197 million), which is money whose use is restricted by the Board or possible by bond resolutions.”
With this information in mind, I hope that Baystate Franklin does not go ahead with a capital campaign. There really is no need to draw additional funding from the service area — there are assets in hand that can be used for this expansion. We all value the essential services provided through our hospital and we value our doctors, nurses and staff members. Consider the facts of this new era when our hospital’s parent company, Baystate Health, has assets that could be earmarked for these necessary upgrades.
Much can be done to counteract the recent changes to our services here in Greenfield: the reduction or elimination of urology, cardiovascular and visiting nurse services and pediatrics. I approve of any plan to strengthen BFMC’s services, and I call on Baystate Health to earmark some of its assets that are already on hand to make it happen.
It would be unfortunate to have the hospital’s capital campaign compete directly with our other large campaigns again. The economy is recovering but is not robust enough yet to make success possible for all our campaigns in the county.
Carol Letson lives in Greenfield.