River’s Edge Hospital and Clinic will be leasing a new piece of equipment to better serve the community after receiving approval from the St. Peter City Council in Monday’s meeting.
River’s Edge CFO Laurie Zook explained that the hospital has been looking into obtaining a 3D mammography machine for some time, since the hospital’s machine is about 10 years old and can only offer patients 2D imaging. This machine is too old to be updated, so the hospital began looking at options, including both leasing and purchasing, for a new machine.
Zook said the idea to begin offering 3D mammograms is because some patients have tissue that is too dense for a regular 2D mammogram. Right now, these patients have to travel out of the area for their mammograms.
“There are a number of women who want to stay in the community and have these things done,” she said. “The 3D mammogram is a much better option for those who have dense breasts or other problems that can’t be properly diagnosed with 2D [imaging].”
Zook added that the new machine will be able to switch between 2D and 3D imaging, so both are available options for patients.
According to Zook, the hospital considered three types of machines, settling on the Hologenic Selenia 3D Mammography machine. It costs about $326,200, and Zook said the cheapest option is to enter into a five-year lease through a group called Central Minnesota Diagnostics Inc. (CMDI), which is a consortium of small hospitals that includes River’s Edge as a member. Funding for the lease will come from hospital funds. The way the lease works is that CMDI will install the machine, and River’s Edge will pay the consortium per exam, agreeing to a minimum of 59 exams a month.
Zook said this machine will end up costing the hospital about $13,000 every year, but she added that it’s worth it to provide a necessary service.
“This will not particularly make us money,” she said. “This is a community service, something that we want to do to keep these services in the community.”
Adding to the hospital expansion project
Zook also updated the council on the hospital expansion project, which is on schedule to be completed in 2020. The $33 million project includes renovation of the existing facility and an expansion of about 35,000 square feet, including a larger emergency department with adjacent ER and Urgent Care services; a new pharmacy with a medication prep room; and 25 patient beds, nursing and support spaces. The project also includes two additional operating rooms.
Zook said now that the project is nearing completion, the River’s Edge Hospital and Clinic Commission has voiced an interest in completing some of the project alternates that had been previously identified.
“There are items in the alternates that need to be decided now in order to make them viable,” Zook said.
One of the main alternates is snow melting equipment for the new main entrance of the hospital. Zook said the infrastructure, such as piping under the cement, is already in place, so now the hospital needs to purchase and install the mechanical portion of the system, such as heaters, pumps and controls. The cost would be about $70,500.
“With the winters that we’ve had, and actually just Minnesota in general, we would like to move ahead and actually get the snow melt equipment,” Zook said.
She added that the plan is to take the necessary funds out of the hospital’s capital funds budget, which was about $750,000 for 2019 and still has $450,000 left in it. The other option is to pull funds out of the project’s contingency fund, which is sitting around 3 percent right now, but Zook said that would drop the fund down to about 1.2 percent, which is too low for comfort. If sufficient funds are left in the project’s contingency fund once everything is completed, the amount can be paid back, but Zook said they don’t want to take too much out of the project contingency fund just in case something comes up.
“We’ll guarantee with capital funds from the hospital [and] purchase it now so we can install it when everyone’s here and make sure it works,” she said.
Mayor Chuck Zieman asked if the hospital was anticipating any more major purchases this year, and Zook said “No,” adding that the largest planned expense is a request for $70,000 worth of new patient beds.
“The reason we’re hesitant to drop the contingency [fund] is because we’ve entered the remodeling phase, and there’s a couple of big items, like big walls, that we have to open up,” she said. “That doesn’t mean that we’re anticipating anything, but any time you renovate, you always have more problems than when you build new.”
After hearing the update, the City Council voted to approve the snow melt equipment.