As Sheridan Memorial Hospital works to continue strengthening local healthcare, it has begun exploring a transition to a critical access designation as part of its long-term strategy for supporting its mission of providing excellent, patient-centered care.
Over the past decade, SMH has experienced significant changes, including increased demand for behavioral health services, a growing senior population and the need for expanded access to specialty care.
Following a review of patient volumes and community needs, hospital leadership has begun exploring a transition from a prospective payment system (PPS) hospital to a critical
access hospital (CAH).
Over the years, SMH has seen a dramatic change in how it is reimbursed for providing care to the community.
The hospital system receives payment from commercial insurance companies as well as fixed payers such as Medicare, Medicaid and Veterans Affairs.
In 2005, fixed payers represented 40% of the payer mix.
Today, fixed payers make up 67% of SMH’s payer mix.
The challenge with such a substantial percentage of fixed payers is that the payments from these sources do not cover the cost of providing care.
Medicare reimbursements, for example, have covered approximately 75% of SMH’s cost to provide care.
The change to a CAH would align with SMH’s ongoing commitment to provide high-quality, patient-centered care while ensuring long-term sustainability as a rural healthcare provider.
Critical access designation would support more stable reimbursement for the cost of care, allowing the hospital to continue reinvesting in its people, facilities and technology.
“Importantly, all current services at SMH would continue if Sheridan Memorial Hospital were to become a critical access hospital,” healthcare system CEO Mike McCafferty said. “The hospital would maintain its full scope of care and continue adapting to meet the needs of the community.”
SMH leadership is working closely with clinical teams and staff to evaluate opportunities and ensure any changes are implemented thoughtfully, with a continued focus on patient experience and quality care.
“As a community hospital, our responsibility is to ensure we are positioned to serve Sheridan and the surrounding region for years to come,” McCafferty said. “These efforts are about
strengthening that foundation.”
