Public safety net hospital MetroHealth System lost $2.7 million last year, but hospitals officials are feeling optimistic about 2012 and are predicting a $10 million surplus.

Recent trends have MetroHealth leaders feeling confident as they look toward the rest of this year: rising patient volume, a reduction in staffing expenses and an increase in outpatient services, The Plain Dealer reported.

Even though Metro’s 2011 loss of $2.7 million was greater than the $1.1 million loss that had been predicted earlier, officials pronounced themselves “positively joyful” about the year’s financial results.

Metro actually made money on operations ($3.3 million), but the net loss was due to charity care and debt financing costs.

Last August, MetroHealth officials warned of an anticipated $6 million operating loss for 2011. The hospital cut about 450 jobs last year to take a bite out of the loss.

The health system is in the midst of a search for a new CEO after current chief Mark Moran last month announced his intention to step down.

Moran is widely credited with helping turn MetroHealth’s financial situation around, but his tenure has also been marked by controversy over no-bid consulting contracts and generous pay packages to departing executives.

Less than a month after its CEO announced plans to resign, public safety net hospital MetroHealth System is starting the process to look for a successor.

MetroHealth has posted on its website a request for proposals from executive search firms that would assist the hospital in locating candidates for the CEO position, according to an update from Ronald Fountain, chairman of MetroHealth’s board. Fountain said he would periodically provide similar updates to “maintain transparency in the search process.”

In addition to looking for an executive search firm, the board has appointed the leaders of a search committee, with those leaders expected to fill the remaining slots on the committee.

Fountain’s update didn’t provide a time line for any of the next steps in the process of finding a replacement for existing CEO Mark Moran.

Finding a well-qualified candidate who actually wants the job may not be easy. Moran himself has referred to public hospitals as an “endangered species” with federal health reform representing a “freight train heading toward us.”

MetroHealth’s finances are shaky as it stares down increases in unreimbursed care, a decrease in its subsidy from Cuyahoga County and reductions in reimbursement from government programs and private health insurers. In particular, an increase in poverty in the suburbs of Cleveland has had a “dramatic effect” on MetroHealth, Moran has said.

The problem for Moran’s successor will be that none of those issues are easily solved or likely to go away anytime soon.

Benjamin Spock died in 1998 and soon after that, his famous book has had one co-author: Dr. Robert Needlman.

Needlman is a pediatrician at MetroHealth Medical Center and associate professor of pediatrics at Case Western Reserve University. He’s also a graduate of Yale Medical School and worked at Boston City Hospital. He’d been part of a team working on Drspock.com and got the job as the new Dr. Spock when he interviewed with Spock’s widow.

Needlman already was among a team of medical experts developing content for www.drspock.com when he went to dinner with Morgan more than a decade ago to discuss becoming the revising author of the eighth edition of Dr. Spock’s Baby and Child Care.

During the dinner, Needlman suddenly told Morgan he needed to leave.

Morgan was perplexed — until he explained that he had a nightly tradition of reading with his daughter, Grace, then 10, even when he was out of town and had to read over the phone.

He got the job.

“I said, ‘This is the kind of person that Ben would want to carry on his work,’ ” Morgan recalled.

Needlman has been sharing top billing with Spock for years on various books and handled the eighth edition of Spock’s famous book as well. The ninth edition of Dr. Spock’s Baby and Child Care, released Tuesday, adds advice on everything from immunizations and obesity to special needs children and video games.

Needlman had a literary reputation beyond Dr. Spock. His undergraduate degree at Yale was in English literature. While in Boston he helped start Reach out and Read, a  nonprofit that promotes the value of reading out loud to children. He’s also written for Yahoo! and Parent and Child Magazine.

[Photos courtesy of Wikimedia commons and Primrose Schools]

UPDATE: Morgan writes with these addendums.

The moves, announced Thursday in a prepared statement, are part of a broader effort MetroHealth detailed in September to cut 450 jobs.

The layoffs and position eliminations come in response to mid-year projections that showed MetroHealth could suffer operating losses of $6.3 million in 2011 and $21.1 million next year.

The hospital attributed its difficult financial situation to increases in unreimbursed care, a decrease in its subsidy from Cuyahoga County and reductions in reimbursement from government programs and private health insurers.

“Poverty has increased in Cuyahoga County over the last decade, particularly in the suburbs and this has a dramatic effect on MetroHealth,” CEO Mark Moran said.

MetroHealth announced plans last week to open a new, $23 million outpatient community health center in suburban Middleburg Heights. To help stem its losses, MetroHealth is seeking to expand its footprint in the suburbs and care for patients who have better-paying insurance.

But even that strategy may not be enough to reverse Metro’s deteriorating finances, because — as Moran noted — Cleveland’s suburbs are finding themselves home to an increasing number of poverty-stricken residents.

Like other publicly funded hospitals across the country, MetroHealth faces an uncertain future amidst financial pressures and uncertainty over the effect of last year’s controversial federal health reform package, which could take a bite out of public hospitals’ patient base.

The job cuts are expected to hit patient-facing employees, as well as supervisory and administrative workers. About 150 of the 450 cuts will be achieved by not replacing employees who have left, The Plain Dealer reported.

MetroHealth last month said it was freezing hiring to head off an anticipated $6 million operating loss.

Hospital officials blamed some of that anticipated loss on an increase in charity care. Charity care at Metro has increased about 8 percent this year compared to the same period last year, according to The Plain Dealer.

Like other publicly funded hospitals across the country, MetroHealth faces an uncertain future amidst financial pressures and uncertainty over the effect of last year’s controversial federal health reform package, which could take a bite out of public hospitals’ patient base.

The main reason for the projected loss is a 9 percent uptick in uninsured or under-insured patients, according to a statement from the publicly subsidized safety-net hospital.

Other factors hurting MetroHealth’s finances include: state cuts to Medicaid, a shift from inpatient to outpatient care and rising overhead costs for employees, pharmaceuticals and supplies.

“MetroHealth has been behind our budget goals all year and it’s clear that these trends are continuing,” CEO Mark Moran said. “Break-even operations like this are nothing new to MetroHealth and we will attack this situation aggressively.”

The specter of an operating loss would be a return to the bad old days for MetroHealth. Moran helped engineer an impressive financial turnaround for the hospital that led to three consecutive years in the black from 2008 to 2010. Metro lost about $2 million in 2007.

In addition to the hiring freeze, Moran outlined several other steps Metro would take to avert the $6 million loss in 2011:

• Reviewing admission criteria and challenging payors on reimbursement levels
• Reducing discretionary expenses that are not related to patient care, including consulting and travel
• Ensuring that patients are treated with the appropriate level of resources
• Developing new service locations to move more care to a stronger ambulatory network

The word that jumps out from that list is “consulting.” MetroHealth has come under intense, public-records-request-fueled pressure from The Plain Dealer for a series of no-bid consulting contracts to Moran’s former employer, as well as consulting payments to departing Metro employees.

Perhaps the reduction in consulting expenses will tamp down some of that furor, but it’s just as likely that more information uncovered through Freedom of Information Act requests from The Plain Dealer will lead to further headaches for Moran and crew.

First, MetroHealth’s Board and management team have demonstrated an ability to manage the organization to deliver the mission at break-even or better financial results. MetroHealth has run in the black since 2008 after a decade with seven years of losses. More importantly, MetroHealth delivered 200,000 uncompensated visits in 2010, up 25 percent since 2008, demonstrating our commitment to mission. We use margin to do mission!

Second, MetroHealth’s mission will never make an attractive acquisition target. As a public safety net hospital almost 20 percent of our care is uncompensated. The coverage expansion in health reform may give half of those patients insurance, but Medicaid rates will probably decline, as you report. So medical care for lower income patients will continue to be a money losing proposition. The County subsidy only pays for one third of the cost of our uncompensated care, so that cannot be the rationale for acquisition. Therefore MetroHealth can only be an attractive target if the acquirer can jettison the mission. We who are committed to provide access to all will fight that prospect zealously.

Third, your view that no one with alternatives will come to a safety net hospital is belied by the data. In Massachusetts ambulatory care visits to safety net providers grew at over twice the rate as visits to non-safety net providers once uninsured patients were covered. (Arch Intern Med/Vol 17/Aug 8/22 2011: Safety Net Providers After Health Care Reform). Assuming that MetroHealth is not attractive to patients with choice is a leap too far. We are planning to serve the influx of newly insured patients with the same convenient, high quality medical services we provide today.

MetroHealth’s elimination is not inevitable! Our Boards, physicians, staff and management come to work every day with a commitment to deliver outstanding care to all. The future is uncertain but we have shown the determination to take our destiny in our own hands and build for it.

The future of public hospitals throughout the United States is imperiled, and for a preview on the impact of U.S. healthcare reform on hospitals, look no further than Cleveland’s public safety-net hospital, MetroHealth System.

Faced with a raft of financial pressures and unfavorable trends, MetroHealth will likely have no choice but to essentially be swallowed up by a larger competitor in the coming years. Given MetroHealth’s moves to strengthen its balance sheet, diversify its revenue base and, in turn, make itself a more attractive acquisition target, the hospital has in a sense already begun the process.

While local health systems say otherwise, recent meetings involving Metro’s executives, administrators and top doctors have led staff to conclude the earliest parts of this endgame are already underway.

In short: MetroHealth a decade from now will bear little resemblance to the MetroHealth of today. At a national level, the takeaway here is the impact of healthcare reform on hospitals will mean the idea of the public hospital will almost certainly be redefined — if not eliminated entirely.

So why is MetroHealth’s future looking so shaky?

It’s no coincidence that CEO Mark Moran used surprisingly stark language recently when describing the future of MetroHealth and other publicly subsidized hospitals like it. Public hospitals are an “endangered species,” he told the Cuyahoga County Council – the county government that provides the hospital its public subsidy. And looking ahead, Moran called federal healthcare reform a “freight train heading toward us.”

A look at MetroHealth’s long odds suggest Moran wasn’t merely employing a rhetorical flourish. Public hospitals could easily lose patients in a post-healthcare-reform, nearly-everyone-is-insured world. Let’s be realistic: If most Clevelanders had the choice — and health insurance — would they go to Cleveland Clinic or MetroHealth? That perception might be unfair, but it’s probably fair to say it’s pretty widespread.

But even then, of the additional 32 million Americans who will be insured, half of them will receive coverage through Medicaid. And Medicaid pays hospitals at such a lower rate than private insurers that some claim Medicaid pays less than hospitals and doctors spend to provide care. (Cue one of Moran’s favorite healthcare sayings: “If there is no margin, there is no mission.”)

Fewer patients? Probably. Lower-margin patients? Almost certainly. Now add the elimination of the Medicare and Medicaid Disproportionate Share Hospital (DSH) payments that pays hospitals like MetroHealth for its low-income patients. Health reform calls for $21 billion in cuts to Medicare DSH payments over 10 years, and $14 billion in Medicaid DSH cuts between 2014 and 2020.

And who would want to be a public hospital, anyway? MetroHealth’s subsidy from Cuyahoga County accounts for about 5 percent of its patient revenues and exposes Metro to so much public scrutiny that Moran and his cohorts have to be wondering whether it’s worth the headache. Thirty years ago public dollars covered all of the charity care the hospital provided. This year the subsidy covers only about one-third of the charity care, a MetroHealth spokeswoman said.

Mark Moran

Add a few more factors: an industry-wide shift from inpatient to outpatient care, further stress on state and local budgets, competition from local rivals like University Hospitals and Cleveland Clinic for insured patients, deteriorating facilities, and rising technology and personnel costs that take a toll on its margins (not to mention its mission).

So what will Metro’s future look like?

Entering pure speculation mode, MetroHealth’s future will almost certainly involve an acquisition, strategic partnership or some sort of change in control that would allow the hospital to come under the umbrella of a larger, richer counterpart.

At least one MetroHealth staffer has come out of meetings believing leadership is already moving in this direction. A scenario that came out of one meeting – rebuffed by MetroHealth – would have seen University Hospitals take over MetroHealth in some fashion, the staff member said. UH would get priority over all patients except trauma and geriatrics, which would remain primarily with Metro. But UH would also have right of first refusal of any patient, which it could then send to MetroHealth.

MetroHealth, essentially, would have a future as UH’s triage unit.

The denials couldn’t be stronger from the hospitals on that particular scenario.

“Over the course of time we have had many conversations with many organizations about affiliations and partnerships,” Moran stated in an e-mail. “We pride ourselves on being able to work collaboratively in clinical, teaching and research endeavors with all organizations in our region. The arrangement that you describe is not something we have been presented with or considered in any way and does not sound like it would benefit MetroHealth. We are not in any conversation with any other organization about a change of control of MetroHealth.”

UH spokeswoman Janice Guhl said: “UH did not make an offer to buy Metro. We do talk to them about collaborative opportunities and our door is very open to those.”

“Collaborative opportunities” may be a key phrase here. It’s possible that UH or another hospital could enter a “collaborative” arrangement with Metro, in which the collaborator takes over all of Metro’s specialty services, while leaving primary care and emergency care within Metro’s purview. In such an arrangement, the “collaborating” hospital would essentially be subsidizing Metro’s money-losing operations in exchange for gaining access to all of its more lucrative specialty patients.

But these kinds of scenarios are likely the only future for MetroHealth and other hospital systems like it nationwide. For MetroHealth in particular, UH may be the only option. Other candidates like Kaiser Permanente may take too long to act, and nearby Summa Health System is perceived as cash poor and unable to do a deal. Cleveland Clinic is thought to have no interest.

But all the better to do a deal now before the health reform train smashes into MetroHealth’s balance sheet and the hospital loses bargaining leverage.

If you think about how Moran has been managing Metro in the last several years, it’s comparable to the way a private CEO would streamline a company before acquisition. He’s cut jobs; planned expansion outside of the City of Cleveland to attract a wealthier, suburban customer base; pushed patients away from expensive ER treatments and – as a result – greatly improved the health system’s balance sheet. MetroHealth held $148 million in current, or liquid, assets, at the end of 2010, according to its financial statements. That’s an impressive increase of 49 percent compared to the prior year.

That improved balance sheet is what gives Metro a little leverage now. But it’s easy to imagine that those liquid assets will dwindle as Metro is rundown by the freight train of health reform. The hospital could easily burn through its money a few years after reform goes into effect. Then it will have no margin, no mission and no leverage against cut-throat takeovers.

Will this be the future of all public hospitals nationwide?

J.B. Silvers

A Case Western Reserve University  professor of healthcare finance has been appointed to MetroHealth System‘s board of trustees. 

J.B. Silvers  was appointed to the board of the county-subsidized health system by Cuyahoga County Executive Ed Fitzgerald, Crain’s Cleveland Business reported. 

Silvers’s research has focused in the areas of financial management and health services, and it’s highly unlikely that his specialty in financial management is a coincidence. 

MetroHealth has faced increasing scrutiny from the new Cuyahoga County Council, as members have questioned lucrative consulting contracts awarded to the former company of CEO Mark Moran. 

During a May hearing in front of the council, members also questioned Moran on the health system’s plans to expand its footprint in the suburbs rather than the city. At the hearing, Moran referred to public hospitals as “endangered species” due to significant financial pressures. 

To his credit, Moran has helped turn the health system’s finances around and has led it to three consecutive years in the black. 

But it doesn’t appear that things will be getting easier for Moran or MetroHealth any time soon. In the same hearing, Moran referred to federal health reform as “a freight train heading toward us.” Most of the law’s provisions take effect in 2014. 

Moran’s biggest challenge in the coming years likely will be figuring out a way to prevent MetroHealth from being flattened by that freight train. 

MetroHealth will receive a $36 million subsidy from the county this year, a fairly small portion of its revenue, which stood at $763 million last year. 

Earlier this year, Moran outlined in an internal memo the challenges facing Metro: an industry-wide shift from inpatient to outpatient care, a continuing decline in inpatient volumes, rising charity care and “significant pressure” on funding sources including Medicare and Medicaid.

Mark Moran

Cleveland-area safety net hospital system MetroHealth System reported operating income of nearly $24 million for 2010, a 37 percent tumble from the prior year.

It was the third consecutive year in the black for the once-struggling health system. CEO Mark Moran told the Plain Dealer the drop in operating income had more to do with what happened in 2009 than 2010. Last year, the hospital was working to “clean up” its finances and implemented a number of one-time cost-saving measures.

“We collected a bunch of old cost reports and we cleaned up a bunch of really one-time balance sheet improvements, which we don’t have anymore,” Moran said. “The clean-up work, I would say, is largely done and now we’re operating as an ongoing concern.”

The health system eliminated 400 positions in 2009, which resulted in about 270 layoffs.

Operating income for the year was 16 percent below the amount Metro had budgeted for, according to financial documents provided by MetroHealth.

Total revenues rose 6 percent to $763 million. That amount was slightly above budget.

MetroHealth’s board apparently likes what it sees, because it announced its decision to renew Moran’s contract. The board will vote on whether to give Moran a one- or two-year extension. The 55-year-old Moran receives an annual salary of $550,000 and is eligible for an incentive bonus of $150,000, the Plain Dealer reported.

“I think he’s done an amazing job,” Board Chairman Ronald Fountain said of Moran. “He’s a strategic thinker and we need a strategic thinker.”

Moran was brought on as interim CEO in 2008 and assumed the permanent post a year later. He’s widely credited with turning around the hospital’s finances. As recently as 2007, MetroHealth was in the red, losing $2.2 million that year.

Moran stressed that even as Metro’s subsidy from Cuyahoga County is declining in 2011, the hospital increased the amount of charity care it provided in 2010. Charity care grew 9 percent to $109 million last year. Metro’s county subsidy will decline nearly 10 percent to $36.1 million in 2011.

Moran wouldn’t rule out layoffs in 2011, but said if they happen, they won’t be as severe as 2009. “We’re just going to look in every department and see if we’re sized properly,” he said.

Despite the positive financials, Fountain warned that lots of work remains. “There is much yet for us to do … The future ain’t what it used to be, so there can be no turning back,” he said in an internal memo to employees.

Moran, in the internal memo, outlined MetroHealth’s challenges: an industry-wide shift from inpatient to outpatient care, a continuing decline in inpatient volumes, rising charity care, and “significant pressure” on funding sources including Medicare and Medicaid.

So how did they do? Based on 2010 numbers provided by each of the health systems, MetroHealth came close. Cleveland Clinic … not so much. UH? That’s a little complicated.

First, let’s take a look at what each health system projected late last year:

• Cleveland Clinic told the Plain Dealer it was looking to hire about 1,800 people across the country, with about 1,600 of those hires projected to come in Northeast Ohio.
• UH said in a December 2009 statement it planned to hire 500 workers, primarily physicians. Part of the hiring push came from UH’s anticipated opening of Ahuja Medical Center in Beachwood in early 2011.
• MetroHealth said in December 2009 it had about 270 full- and part-time jobs posted. Metro should probably be cut the most slack relating to 2010 hiring, because it never explicitly said it planned to hire a certain number of workers.
• That comes to a projected total of 2,370.

Now, let’s look at how 2010′s reality matched up with 2009′s projections:

• Cleveland Clinic hired 720 people, citing the weak economy for the shortfall. “With ongoing economic challenges, we are committed to delivering the best care to our patients, and to minimize the effects of the economy on our workforce,” a spokeswoman said. It should also be noted that in November, the Clinic announced it would lay off about 200 workers in a bid to consolidate services.
• Here’s where things get a little complicated. UH was unable to provide an apples-to-apples comparison on its actuals compared to its projections. UH said by the end of the year it will have hired 464 to open Ahuja, but just 55 percent (about 265) were external hires. As a point of further clarification (or confusion), UH said it had filled 2,165 positions through November, with 65 percent of those (around 1,400) being external hires. The 1,400 figure includes the Ahuja hires. So did UH create 1,400 jobs? Not really. Much of that figure stems from employee turnover and does not represent jobs created by the hospital, according to UH. What’s it all mean? Essentially, we’re not going to get a simple and tidy number that’d tell us how closely UH hewed to its projection of hiring 500.
• MetroHealth said it made 231 “non-replacement” hires and laid off 40 workers in 2010.

Whatever the final numbers ended up being, it seems safe to say they fell short of 2,370. If there’s a bright side for job seekers, it’s that each of the hospitals has plenty of positions open — 1,200 at Cleveland Clinic, more than 900 at UH, and 245 at MetroHealth.

Plus, hospitals continue to be big jobs-generators across the state. Ohio hospitals employed 348,211 in 2008, the last year for which data is available, up nearly 5 percent from the prior year, according to the Ohio Hospital Association. Hospitals are expected to add more jobs than any other industry in Ohio through 2016, according to a report (pdf) from the Ohio Department of Job and Family Services (ODJFS).

Broadly speaking, healthcare remains the strongest job-growing sector of Ohio’s economy, an ODJFS spokesman told the Associated Press last month. “The only area that maybe we feel is really robust right now is healthcare,” said Ben Johnson. “We’ve seen signs of a lot of healthcare hiring in recent months.”

Photo from flickr user heidigoseek

Akron Children’s specialists will focus on the areas of pediatric cardiology, gastroenterology, cancer and blood disorders, and critical care.

MetroHealth’s pediatric specialists will continue to provide care in a number of other areas, including neonatology, nephrology, pulmonology and rheumatology, according to a joint statement from the two hospitals.

Akron Children’s has similar affiliation agreements with several Ohio health organizations, including Aultman Hospital in Canton and St. Elizabeth Health System in Youngstown. The MetroHealth affiliation will be Akron Children’s fourth location in Cuyahoga County.

Mark Moran

With an influx of 32 million newly insured patients thanks to health reform just a few years away, it’s an understatement to say the U.S. hospital industry is in for big changes.

More patients means greater opportunity for revenues, but the extra volume also has the potential to stretch hospitals thin and overtax already-burdened clinical staffs. Plus, with state and federal budgets under pressure, it’s likely reimbursements will fall, further squeezing hospitals’ profit margins.

So what can hospitals do to get ready for 2014, when most of health reform’s major provisions are set to kick in? Mark Moran, CEO of Cleveland’s safety-net MetroHealth System, shared a few steps that his health system has begun taking to deal with health reform fallout. Moran spoke during a conference call hosted by HealthLeaders Media titled “More Patients, Less Money, Higher Quality.”

• Develop a strong network of walk-in health centers: Though they require a large up-front investment in overhead, ambulatory centers spread throughout a community can be an effective way of reaching far-flung patients and building market share. For MetroHealth, ambulatory centers also are a way to expand its patient base to higher-income suburbs, which is no small consideration for a health system that sees about 17 percent of its volume go toward uncompensated care.
• Tighten the supply chain: In areas like orthopedics and cardiology especially, hospitals can gain savings from coordinating among doctors and choosing a small number of preferred suppliers. “While it’s a small piece of the puzzle, it’s really helped us get cost out of the system quickly,” Moran said.
• Ensure clinicians work at their highest skill levels: Internal studies showed that some MetroHealth physicians were working at the top of their skill levels only about 30 percent of the time. For advanced practice nurses, that number was even lower. One of the keys to getting people working at their highest skill levels is to raise the skills of those around them. To that end, MetroHealth began retraining some workers to help them acquire new skills. Though daunted, workers often responded positively when they saw that the health system was committed to enhancing their job skills, Moran said.
• Envision a world after fee-for-service: Paying physicians under the fee-for-service model has brought skyrocketing health costs and skewed incentives. Those are two reasons why the model’s days likely are numbered. Filling the future void could be the much-touted patient-centered medical home (PCMH) model of care, which emphasizes care coordination, teamwork and information technology. Hospitals would be wise to examine transitioning their organizations to the PCMH model now to avoid scrambling to catch up should there be an industry-wide shift in coming years.

MetroHealth System and University Hospitals in Cleveland, and Summa Health System in Akron, are joining Cleveland Clinic, the inaugural network member that helped launch Explorys last year. The regional collaboration is a model for how Explorys hopes to expand nationally in coming months.

“Expanding our network of participating healthcare providers, particularly within the same competitive region, demonstrates our ability to address the privacy and security needs necessary to foster cooperation between health care providers,” said Stephen McHale, Explorys CEO, in a written statement. “Now that we have proven that the model can scale, our next objective is to expand nationally.”

Founded in 2009 by data management veterans McHale and Charlie Lougheed, Explorys provides data services and applications that enable healthcare providers, accountable care organizations, and biotech and pharmaceutical companies to improve treatment, as well as to accelerate research and product development at the same time they measure performance and drug safety.

Explorys has curated more than one billion clinical records from participating healthcare providers in a privacy-protected and HIPAA-compliant platform for high-speed search and analytics.

“In addition to creating a network of peers for conducting break-through research, Explorys provides healthcare providers with a massively scalable and cost effective, dynamic data platform that enables them to leverage their expanding data to identify opportunities for improving care and cost of delivery,” said Lougheed, president and chief technology officer, in the statement.

Making the vast (and growing) amount of medical information searchable and understandable to doctors and researchers is key.

“Every provider continually looks for ways to improve patient outcomes” said Greg Kall, senior vice president and chief information officer for Summa. “This platform will allow us to look at a comprehensive patient data set from across the region in new ways to better understand how to improve the health status of the communities we serve.”

Dr. Achilles A. Demetriou, president of University Hospitals, agreed. “We are very excited to be part of this initiative as we believe it will advance our ability to carry out meaningful clinical research in the future.”

In August, Explorys raised $2.55 million in Series B funding from Sante Ventures and Cleveland Clinic Innovations. The company’s Series A round of $1 million in October 2009 was led by 23Bell LLC of Cleveland, McHale’s and Lougheed’s investment company. And early this year, it snagged a $17.6 million, 10-year job creation tax credit from Ohio for potentially creating more than 300 jobs.

The primary reason for the subsidy cut to $36.1 million from $40 million in the county’s 2011 budget is a reduction in property tax collections. Property values are down, so the Health and Human Services levies — which fund MetroHealth’s subsidy — are falling along with those values, County Administrator Jim McCafferty said.

McCafferty said the subsidy reduction shouldn’t affect MetroHealth’s budget much because an increase in county employees enrolling in MetroHealth plans is likely to make up for the shortfall, at least in part. The county is projecting to spend $9 million next year on employee health plans with MetroHealth, up from $7 million this year, he said.

“The word is out that Metro gives you good care, and it’s a good plan, so more employees are taking advantage of it,” McCafferty said.

However, MetroHealth Board Chairman Ronald Fountain said “some” service cuts “might be considered” in response to the declining subsidy, according to the internal memo. The memo didn’t provide further detail on what cuts could be considered, and a MetroHealth spokeswoman said it’s too soon to tell.

Further, the $4 million represented in the subsidy cut is a pittance when viewed in relation to MetroHealth’s most recent annual revenues. The cut represents less than 1 percent of the health system’s 2009 revenues of $710 million.

County executives called the subsidy reduction “temporary,” according to the memo, which the MetroHealth spokeswoman forwarded at the request of MedCity News.

The Cuyahoga County Commissioners are likely to pass the county’s 2011 budget Thursday, McCafferty said.

EMS Commissioner Ed Eckart told WKYC that closing the Huron Level II trauma center would have a “tsunami-like” effect on EMS ambulance service. Eckart predicted all response times would be greatly increased and that ambulances would be out of service for much longer periods of time.

The Clinic is consolidating trauma operations at Hillcrest Hospital in Mayfield Heights. Eckart says that’s too far away to be helpful in most EMS runs.

Almost all trauma patients would be transported to MetroHealth Medical Center. Eckart predicted the closing of Huron’s trauma center would also result in a back up of ambulances and slower emergency service there as well.

“The facts and information demand they reconsider,” said Cleveland Mayor Frank Jackson. Cleveland City Council’s Safety Committee will hold a hearing on the proposed closing this Wednesday.

Cleveland Clinic President Dr. Toby Cosgrove is invited to appear. Clinic Spokeswoman Eileen Sheil said a delegation of other doctors and government relations officials would attend.

Safety Committee Chairman Councilman Kevin Conwell called the decision a “slap in the face to Cleveland and inner ring suburb residents who depend on the Huron Road facility.”

EMS Commissioner Eckart says the center’s certification as a trauma center is due to expire on Oct. 29. Sheil said the intention is to keep the facility operating until next year, with or without the certification.

The Clinic issued this statement about the decision:

“Cleveland Clinic is committed to providing the highest quality of care and safety to its patients. The decision to consolidate trauma services from Huron Hospital to Hillcrest Hospital was due to the fact higher quality comes from higher volume and concentrated expertise. Further we have been challenged to secure enough surgeons at Huron to provide 24-hour coverage. Huron’s emergency department remains open and there are two, larger emergency departments within three miles of Huron Hospital (the Clinic and University Hospital) fully capable of treating patients and if necessary stabilizing for transfer.”

Cleveland Clinic

Dr. David Bronson, president of the Cleveland Clinic Regional Hospitals, informed employees at Huron Hospital early Wednesday afternoon.

“We’re developing a system in partnership with MetroHealth. That system is about having protocols, procedures and care plans that lead to better care. You do that best in consolidated facilities,” Bronson said.

Dr. Bronson says the closing of the trauma center won’t result in any significant job loss; that employees at Huron will have the option relocate to Hillcrest Hospital, which is absorbing Huron’s trauma center into its own. Hillcrest Hospital, roughly 8.5 miles from Huron, has a better emergency room and better access to the highway than Huron, Bronson said.

Bronson also added that the Cleveland Clinic has trouble recruiting staff at Huron. “For a lot of reasons. Some are obvious, some are less obvious. People want to work with the latest technology in the newest centers and be associated with those people doing the same thing,” Bronson said.

Huron Hospital sees about 28,000 patients in its emergency room each year, a small percentage of whom require trauma care. Many East Cleveland neighbors expressed concern over the trauma center’s relocation.

“It may be bad in the future. You felt like if something ever happened to you, you could just run across the street,” said Bret Pardon, who lives in an apartment nearby.

Depending on the time it takes to get emergency response teams and staff in place, the Huron trauma center doors are expected to close in early 2011.

This is the second time in the past two years that the Cleveland Clinic has consolidated trauma centers. In a similar move, Lakewood Hospital’s trauma center has combined with Fairview Hospitals.

MetroHealth Medical Center will continue to function as Cleveland’s level one trauma center, taking in the most serious of cases.

Though Huron is losing a trauma center, the hospital is gaining a new community health center in October 2011. The center will focus on chronic disease care.

Pardon said thankfully, he hasn’t needed trauma care since living in the neighborhood, but he wonders how the changes will affect him should he need it in the future. “Having Huron here, makes you feel secure. It could be an inconvenience if something happens in the future,” Pardon said.

Sarah Stamp is leaving Cuyahoga County’s safety-net hospital system to “pursue new opportunities for professional growth,” according to an internal memo announcing her departure. A MetroHealth spokeswoman forwarded the memo at the request of MedCity News.

The memo, written by COO Dr. Ed Hills, praised Stamp for the “dedication, enthusiasm and tenacity” she brought to the role.

The spokeswoman said she didn’t have any further information regarding Stamp’s exit.

Stamp began her job overseeing MetroHealth’s day-to-day medical operations in 2005.  Stamp’s resignation and the hospital’s careful phrasing of the announcement bring to mind the circumstances surrounding the departure of MetroHealth’s former chief operating officer.

Earlier this year, COO Angeline Marano resigned after less than a year on the $440,000-per-year job, citing an inability to forge a bond with her boss, CEO Mark Moran.

Chief information officers at healthcare providers and insurance firms are worried that their organizations won’t be able to win so-called “meaningful use” designation for electronic health records systems in time to take advantage of government subsidies, according to a report by PricewaterhouseCoopers.

In a survey of 120 CIOs, the consulting firm found that 80 percent are “concerned with the ability to meet MU requirements within the specified time frame.”

“Without a set of final rules in place, lack of clarity around certain criteria and reporting requirements has left some CIOs at an impasse,” according to the report. “Fueling the concern are availability of skilled IT resources, infrastructure requirements, vendor readiness, and effecting behavioral change across the organization.”

The federal government is promising about $40,000 out of a $20 billion kitty to each physician practice, hospital or other healthcare provider that can prove “meaningful use” of an EMR system, but has yet to establish exactly what it means by meaningful use. More than a third of the CIOs surveyed said they’re also worried about software vendors’ ability to deliver systems that will meet the criteria, with 44 percent saying their HIT vendors aren’t ready.

“I think we all wonder if we’re going to be ready,” John McInally, CIO for MetroHealth System in Cleveland, told MedCity News. “I don’t know any of my colleagues anywhere that feel they’re completely ready for meaningful use.”

In order to be eligible for the federal handout, healthcare providers must use a certified EMR product and be able to demonstrate the ability to meet reporting requirements.

“The real test, though, will be the new quality reporting requirements that come with this meaningful use,” McInally said. “So it’s not enough to just have the information systems installed from certified vendors, but you also have to be able to produce reporting that demonstrates you’re using those systems to assure high-quality patient care.”

The PWC survey showed that healthcare providers that pull doctors, patients and insurers into the loop are more likely to be ready to apply for stimulus cash next year. But less than 20 percent of the CIOs surveyed said their employers are including patient input into their meaningful use initiatives. By contrast, 63 percent said their organizations are already working with physicians or will in the next six months.

Material from MedCity News was used in this report.

The phrase applied to using electronic health records (EHRs) in ways that raise the quality of healthcare while reducing its cost is striking anxiety in the hearts of hospital chief information officers nationwide.

Despite the $22 billion in federal incentives soon to be available to hospitals and doctors’ offices that install and use the systems — and the army of organizations ready to help them — only half of the chief information officers (CIOs) at hospitals and health systems surveyed recently by global business consultant PricewaterhouseCoopers expect to meet the first set of requirements to get incentives next year.

“I think we all wonder if we’re going to be ready,” said John McInally, chief information officer for MetroHealth System in Cleveland, Ohio, which as been investing in electronic health systems for more than a decade. “I don’t know any of my colleagues anywhere that feel they’re completely ready for meaningful use.”

The Obama administration is dangling large financial carrots — and eventually will use big financial sticks — to get both hospitals and doctors to adopt the technology aimed at helping to reform the nation’s healthcare system.

And it’s not just the current administration. Federal policymakers decided 10 years ago that most American should have electronic health records by 2014, according to the Centers for Disease Control and Prevention (pdf). That federal deadline has since been pushed to 2015.

Why all the fuss about meaningful use and electronic health records?

“Certified electronic health record technology used in a meaningful way is one piece of a broader health information technology infrastructure needed to … improve healthcare quality, efficiency and patient safety,” according to the Office of the National Coordinator for Health Information Technology.

Some of the CIO uncertainty is coming from lack of clarity. Final meaningful use rules aren’t due out until the end of summer, so a lot of the information officers have question marks in their electronic health record strategies.

“The rules require that you have an electronic health record that has been certified, and there are temporary certification rules,” said McInally, who came to MetroHealth in December after spending several years as chief information officer at Stanford University Medical Center’s Lucille Packard Children’s Hospital. “So there’s a lot of final work that has to happen. And we’re talking about a political process.”

For some information officers, the concern also is a matter of resources. Many small or rural hospitals don’t have the money to buy and use the electronic record systems that will be federally mandated in five years. The PricewaterhouseCoopers survey doesn’t even address doctors’ offices, which may have fewer financial resources. That’s where the federal (and some state) incentives come in.

In Ohio, that means $27 million in federal stimulus and state money for seven regional extension centers like Case Western Reserve University that will help hospitals and doctors adopt electronic health records. The recently created Ohio Health Information Partnership is using $14.9 million in federal funds, with a state match of $2.1 million, to set up a state health information exchange.

The promise of stimulus money has accelerated EHRs adoption and the collection of massive amounts of electronic health data by hospitals and physicians nationwide, PricewaterhouseCoopers said. But the infrastructure to support meaningful use of EHRs in a yet-to-be-created national health information exchange is insufficient, according to CIOs who were  interviewed by the consultant.

Some CIOs are worried about the readiness of companies that sell and implement electronic record systems, PricewaterhouseCoopers said. EHRs and information technology vendors have been jockeying for market position by buying each other lately. That could make for unprepared or unstable vendors.

Others are concerned their institutions have too few skilled staff members to integrate the electronic systems, which have clinical, operational and administrative components, the consultant said.

In the end, it won’t be the systems hospitals install, but how they use those systems that matter.

That’s why some CIOs worry about meeting later meaningful use requirements, such as advancing care processes through decision support, providing and populating patients’ personal health records, and improving health outcomes through data-sharing with insurers, patients and other providers, PricewaterhouseCooper’s Health Research Institute said in its report.

“The real test, though, will be the new quality reporting requirements that come with this meaningful use,” MetroHealth’s McInally said. “So it’s not enough to just have the information systems installed from certified vendors, but you also have to be able to produce reporting that demonstrates you’re using those systems to assure high-quality patient care.”

Ronald G. Fountain

A veteran financial executive and long-time board member has taken over as leader of the MetroHealth System’s trustees.

The Cuyahoga County-owned health system appointed Ronald G. Fountain (pdf) as chairman of its trustee board at its April 28 annual meeting.

New management led MetroHealth in Cleveland to a financial turnaround in 2009. This year, the system’s challenge will be investing wisely in its aging facilities and perhaps building new ones.

The system has seen some trustee and executive turnover lately, and it is trying to recover from a blow to its credibility dealt by a former vice president of construction and facilities who pleaded guilty last year to taking bribes in exchange for inflated construction contracts.

Fountain has been a MetroHealth trustee since October 1997 and has chaired its finance committee for the last year. He also has served on the board’s audit and executive committees. His board term expires in 2013.

Outside of MetroHealth, Fountain has been dean of the School of Business at Walsh University in North Canton, Ohio, since July 2008. He has been a professor of management at Walsh since 2003 and an adjunct professor at Case Western Reserve University’s Weatherhead School of Management since 1996.

Fountain has a long list of financial and business accomplishments. Among them, he:

• Served as chief financial officer for two Fortune 500 companies.
• Led an investor and public relations firm, and led a turnaround-management consultant.
• Co-founded a business process improvement, financial and strategic management advisory firm.
• Led and managed dozens of business combination and recapitalization transactions.

He serves as a speaker and author on effective leadership and management, organizational change, corporate finance, corporate value creation, and investor and banking relations. He also is a co-founder and partner of Capital Acceleration Partners, a strategic business consultant in Cleveland.

Fountain takes over as MetroHealth trustee chairman for William S. Gaskill, who has been named vice chairman. Gaskill has served on the MetroHealth board since 1980.

Cuyahoga County commissioners

Like many county-owned hospital systems, MetroHealth has struggled financially over the years. The system turned a corner last year, ending 2009 with an excess of revenues over expenses of $52.4 million, compared with a mere $641,000 excess in 2008 and a $2.2 million loss in 2007.

Now, the health system is spending nearly $26 million on new medical equipment, refurbishing public spaces like waiting rooms and patient units, building information technology infrastructure and setting up a fund to use during facilities emergencies.

At the same time, MetroHealth lost its chief operating officer, Angeline Marano, late last month. Marano had been on the job for less than a year. The system appointed Dr. Edward R. Hills, chair of its dentistry department, as interim operating chief.

And the system has been dealing with the fallout from a Cuyahoga County corruption scandal, which touched the health system through its former vice president of construction and facilities who pleaded guilty last year to taking more than $600,000 in bribes over a decade in exchange for inflated construction contracts. MetroHealth trustees approves all of the system’s contracts.

MetroHealth trustee appointments also have a bit of politics about them. Ohio law says the county-owned health system must have five Republican trustees and five Democratic trustees. Then, the county commissioners, who are elected officials, make the appointments.

Leaving the trustee board is Cleveland Heights Democrat Ray Sawyer, a retired partner of Cleveland law firm Thompson Hine LLP who was appointed to the MetroHealth board in 1998. Sawyer’s 6-year term expired March 24.

The commissioners replaced Sawyer with John Moss, a Cleveland Democrat who has served on the MetroHealth Foundation Board for three years, the health system said in an announcement to employees. Moss is a vice president, financial adviser and certified financial manager at investment company Merrill Lynch. He will serve a six-year term.

Commissioner Peter Lawson Jones told the Cleveland Plain Dealer he declined to reappoint Sawyer and chose Moss instead because he wanted to take advantage of a chance to bring “not just new blood — but the kind of individuals who have skills in finance” to the board.

Also leaving the board is Richard Hollington III, president of Cleveland investment firm CapitalWorks LLC. Hollington, a Shaker Heights Republican appointed in 2004, resigned for personal reasons when his term ended in March, MetroHealth said. As chairman of the trustee board’s audit committee, he has been an outspoken proponent of reinvesting in the system.

During the trustees’ January meeting, Hollington — a former banker — challenged his fellow trustees to use the system’s financial breathing room to reinvest in MetroHealth’s facilities so it can continue to meet its mission of “saving lives, restoring health, promoting wellness and providing outstanding, lifelong care accessible to all.”

The commissioners reappointed Terry Monnolly to a new six-year term. Monnolly, a Westlake Republican appointed in 2005, is chairman of the trustee board’s facilities and space committee. Monnolly moved over to assume Hollington’s six-year slot, the Plain Dealer said.

Commissioners also appointed Brian F. Murphy to a one-year term. Murphy, a Hunting Valley Republican, has spent most of his career in the specialty chemical industry in Cleveland, working two years with Harshaw Chemical, eight years with Murphy-Phoenix Co., and two years with JTM Products Co., MetroHealth said. Murphy also is active in start-up investing, helping to form the North Coast Angel Fund, an investment fund focused on Ohio seed-stage technology companies.

, the system reported during its monthly trustee meeting Wednesday afternoon.Last year’s excess included $6.1 million in investment interest and realized investment gains, and a $14.6 million net increase in the market value of investments. In 2008, the health system’s investments lost nearly $17 million in value.

“The campaigns launched in 2008 have transformed MetroHealth into a more efficient operation; in 2010, we will build on those operational successes,” Mark Moran, the health system’s president and chief executive since March 2008, said in a written statement.

MetroHealth had revenues of $710.4 million last year, up 3 percent from $686.4 million in 2008. Operating income (which excludes investment income, and gains or losses on investments) was $31.7 million in 2009, compared with $8.7 million in the prior year.

The system provided $252.8 million in charity care in 2009, $12.6 million more than in 2008.

“This is an extraordinary year and an extraordinary turn, but we have to do better at sustaining our mission,” trustee Richard Hollington, an investment banker, said during the board’s meeting. “We have operated for a long time in deficits… that have not allowed us to reinvest in our facility. We must sustain a level of margin that allows us to reinvest in this institution.”

This year, some of that reinvestment will be supported by MetroHealth’s recent issuance of $75 million in Build America bonds(pdf), which will be used to renew the Metro Life Flight fleet of emergency medical helicopters and to expand its community health network.

“Years of operating losses have constrained reinvestment in MetroHealth,” Moran said in the statement. “Our priority is to renew our facilities and expand services so that we can fulfill the growing needs of our patients.”

Mary Vanac

Mary Vanac is co-founder of MedCity News and serves as its vice president and Ohio bureau chief.

Tags: Cleveland, Cuyahoga County, financial statement, financial turnaround, MetroHealth System, Ohio

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[...] During their January meeting, MetroHealth trustees announced a dramatic financial turnaround in 2009. The Cuyahoga County-owned hospital ended last year with an excess of revenues over expenses of $52.4 million (including unrealized investment gains), compared with a mere $641,000 in 2008. [...]

Comment by MetroHealth trustees approve $26 million in capital spending : MedCity News — March 6, 2010 @ 6:07 p.m. 7:51 pm | Edit This

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Dr. Ed Hills

Angeline M. Marano has left her position as chief operating officer for the MetroHealth System “to pursue other opportunities” less than a year after being appointed as the Cuyahoga County hospital system’s first COO in at least a decade.

MetroHealth’s Department of Dentistry chair, Dr. Edward R. Hills, will serve as interim operating chief, said MetroHealth Chief Executive Officer Mark Moran in an announcement to employees on Monday.

“As MetroHealth chief operating officer, Angie has led the clinical operations of the system through a significant reorganization over the past year,” Moran said in the announcement. “Angie brought a strong focus on patient service and a commitment to quality to our management team. I have enjoyed working with Angie, and will miss her positive attitude and experienced counsel.”

Marano was the senior operating officer at University Hospitals in Cleveland for seven years before leaving in 2004 to become the senior vice president and chief operating officer at Fletcher Allen Health Care in Vermont. She was named MetroHealth’s COO in May 2009.

Hills has nearly two decades of medical and administrative leadership at MetroHealth and in the Ohio dental community.

He has been at MetroHealth for 17 years, chairing the Department of Dentistry since 1997. “Under his leadership, the department has quadrupled the number of patient visits (from 10,000 to more than 40,000 per year) and doubled its locations, with dental services available at four sites,” Moran said in his announcement.

Hills launched the division of pediatric dentistry and developed a multi-specialty faculty at MetroHealth. He also is a longtime member of the Faculty By-Laws Committee, serving as chair for a year. And he has been active on the Ohio State Dental Board for more than a decade, serving as its president for three years and chief enforcement officer for five years.

During MetroHealth’s 2009 financial turnaround, Hills played a key role as the physician leader in its Revenue Cycle Campaign–a system-wide development effort to enhance revenue and working capital levels.

“Dr. Hills was at the forefront of the whole transformational process because  he was the clinical head of the revenue cycle campaign,” said Eileen Korey, vice president of communications for MetroHealth. “That campaign was the principal transformative process that got us back in the black and got us into the position of being able to generate enough surplus to reinvest in the system.”

Since last year’s reorganization into patient care units, Hills has been the executive director of the System Services unit, overseeing operations in radiology, pathology, pharmacy and nutrition services. “Dr. Hills really understands that process of change,” Korey said. “As a veteran on the faculty bylaws committee, he’s a very familiar figure among the medical staff here, and knows how to grow and expand a product line, like dentistry.”

Hills will report to Moran, and the patient care unit executive directors and vice presidents of nursing, medical operations and system services will report to Hills.

Two years ago, her life was saved by something most hospitals treat as trash — the umbilical cord blood from a newborn.

A baby’s cord blood is rich with stem cells, which increasingly are being used to cure cancer and other blood disorders.

”I am a living, breathing end product of the most exciting, amazing recycling program on the face of the earth,” she said. ”It’s recycled blood. What better way of recycling than that?”

A nonprofit program is trying to expand throughout Northeast Ohio so more parents can donate their babies’ potentially life-saving gift of umbilical cord blood.

The Cleveland Cord Blood Center is working with Summa Health System in Akron and MetroHealth Medical Center in Cleveland to add those hospitals as donation collection sites.

The only hospitals currently collecting umbilical cord blood for the public bank are the Cleveland Clinic’s Hillcrest Hospital in Mayfield Heights and Fairview Hospital in Cleveland.

Transplants and research using stem cells from umbilical cord blood avoid the ethical and political baggage that goes along with human embryonic stem cells, said Dr. Mary J. Laughlin, founder and medical director of the Cleveland Cord Blood Center in Warrensville Heights.

With umbilical cord blood donations, the blood isn’t collected until after the delivery of a full-term, healthy baby.

”Umbilical cord blood has been quietly emerging in the field,” said Laughlin, an associate professor of medicine at Case Western Reserve University in Cleveland and a pioneer in the field of cord blood transplants.

During a transplant, the stem cells in a baby’s cord blood respond to proteins released by the recipient’s damaged bone marrow cells, Laughlin said.

The stem cells ”hone to the bone marrow, set up shop and start making blood cells,” she said.

In Tirpak’s case, the 68-year-old Boston Heights resident was told she would die within months without a transplant to cure her leukemia.

When a bone marrow donor couldn’t be found, her doctors at University Hospitals Ireland Cancer Center found a cord blood match.

Tirpak doesn’t know the identity of the baby who saved her life; recipients aren’t provided that information.

But her 9-year-old grandson has nicknamed the baby ”Mary Calls.”

”It sounds like ‘miracles,’ ” he told her, ”and that’s what’s going to make you well.”

”It’s a marvelous thing,” she said. ”I’ve been blessed with many days and I hope for many more still yet to be.”

The Cleveland Cord Blood Center is one of 16 public cord blood banks in the United States, according to the National Marrow Donor Program.

The program maintains a registry of available cord blood units in public banks and potential bone marrow donors that transplant centers can search for matches for their patients.

Public cord blood banks differ from private banks, which allow new parents to pay to store a newborn’s cord blood in case it’s needed by the child or another family member in the future.

There is no charge to donate a newborn’s cord blood to a public blood bank, said Dave Clements, the Cleveland Cord Blood Center’s director of business development, government relations and community affairs.

Each donated unit is tested to make sure it is disease-free and contains enough stem cells. A unit must have at least 1.3 billion stem cells to be frozen in liquid nitrogen and stored for future transplantation.

Units ineligible for transplants can be used for research.

If a baby whose umbilical cord blood has been donated later needs stem cells for a transplant, the unit can be returned to the patient if it was stored and not used, Clements said. If the unit is no longer available, the center will work with the patient to find a suitable match worldwide for free.

Cord blood banks charge about $30,000 per unit to help cover the costs of testing, collection and storage, Clements said.

The hospital conducting the procedure pays for the unit and charges patients or their insurer.

Since starting the voluntary collection program at the two Cleveland-area hospitals in 2008, the center has obtained about 5,500 donated units of cord blood, of which 1,800 were able to be banked, Clements said. More than half of new moms at the hospitals now are opting to donate cord blood after delivery.

There is no compensation to the donor family.

The delivering physician collects the blood for donation from the umbilical cord only with parental consent, said Dr. Marcus Tower, chairman of the Department of Obstetrics and Gynecology at Hillcrest Hospital. The process takes about two minutes.

”Every time we collect this, this is basically one life we can be saving,” he said. ”It’s very altruistic. This is something that could save my life, your life or anyone’s life.”

So far, five units have been shipped overnight from the Cleveland Cord Blood Center to transplant centers in the United States and worldwide.

The Cleveland Cord Blood Center relies heavily on financial donations to help cover its $3 million annual budget.

The center is trying to partner with area businesses and philanthropic groups to raise money to cover the cost of adding more collection site hospitals, estimated at $250,000 per site, Clements said.

By expanding to different hospitals, the cord blood bank can boost its donations, as well as increase the diversity of its available cord blood units.

”One of our missions is to make sure everybody has an opportunity to donate, regardless of their ethnicity,” Clements said.

Cord blood donations can be particularly important for African-Americans and patients from other minority groups who need a transplant but often have a difficult time finding a bone marrow match.

White adult patients have a 60 percent chance of finding an unrelated match among potential bone marrow donors, compared to a 5 percent to 15 percent chance among some minority groups, Laughlin said.

”Your tissue typing follows your ethnic background,” she explained.

Unlike donations from adults, cord blood donations don’t need to be a perfect match, Laughlin said. The baby’s immature immune system isn’t as likely to have a strong negative reaction to the recipient’s body.

About half of the 3,000 to 3,500 babies born each year at MetroHealth Medical Center are from minority populations, said Dr. Brian Mercer, the hospital’s director of obstetrics and maternal-fetal medicine.

The cord blood donation program offers ”a great opportunity to provide this for a broad range of people,” he said. ”It’s very exciting because it’s a public cord blood bank. That means it will make stem cells available to anybody and makes it available not just nationally but internationally.”

Summa’s Akron City Hospital — another site that could be added as a donation center in the future — had 3,480 births in 2009.

”We are involved with discussions with the Cleveland Cord Blood Center about the possibility of beginning a donation program at Summa,” spokesman Mike Bernstein said. ”It’s our hope that we will find opportunities to work together, but we are very early in the process and it is premature to discuss the specifics.”

The initial capital request for this year of $25,949,970 does not include the cost of a new community health center, for which ground could be broken in the third quarter, said Eileen Korey, vice president of communications.

During their January meeting, MetroHealth trustees announced a dramatic financial turnaround in 2009. The Cuyahoga County-owned hospital ended last year with an excess of revenue over expenses of $52.4 million (including unrealized investment gains), compared with a mere $641,000 in 2008.

At that time, trustee Richard Hollington challenged his fellow trustees to use the financial breathing room to reinvest in MetroHealth’s facilities so it can continue to meet its mission–”saving lives, restoring health, promoting wellness and providing outstanding, lifelong care accessible to all,” according to its Web site.

The largest part of the initial capital request–$9.38 million–would be spent on equipment, from IV pump replacement to an upgrade for radiation oncology equipment to a medication management system for the Pharmacy Department.

Almost as much–$9.34 million–would be used to refurbish interior spaces at MetroHealth’s main campus. That means some rooms in the hospital’s patient tower could get a “substantial face-lift,” Korey said.

Another $4.7 million would be spent on infrastructure, mostly information systems upgrades or equipment replacements. And $2.5 million would establish an Emergency Capital Fund administered by MetroHealth’s chief operating officer, Angeline Marano, to take care of emergencies–like a broken water pipe–that would compromise patient care or public safety.

MetroHealth CEO Mark Moran noted during the trustee meeting the importance of agreeing to a new three-year contract with the American Federation of State, County and Municipal Employees labor union, which represents nearly 1,900 employees, including staff in food service, laundry, transportation, environmental services, respiratory therapy and patient registration.

“I want to recognize an important step for the MetroHealth System going into the next year,” Moran told the trustees. “In January, we finalized a collective bargaining agreement between MetroHealth and AFSCME Local 3360, Ohio Council 8.”

The union agreed to a 5.75 percent wage increase over the three-year contract, according to MetroHealth. Last year, union members received a 3.5 percent wage increase, the health system said.

“The wage package is attractive for us. The health care settlement reflects the reality of sharing costs in the future,” Moran said. The changes “are going to help MetroHealth perform better in the coming three years. The union made a significant investment in our success.”