Going into the Eureka Springs City Council meeting held Monday, Sept. 8, the agenda included no new business, a rarity for the council.

It didn’t take long into the meeting for that to change, however.

A pair of items related to the nearly year-long saga of issues surrounding Eureka Springs Hospital were added to the agenda at the beginning of the meeting, and those items ended up taking up a majority of the 61-minute session.

Council member Rachael Moyer, who has spearheaded discussion of hospital finances in recent workshops and meetings, had an item added on that topic, while Susane Gruning added an agenda item regarding more hospital concerns.

Moyer’s points dealt with continued questions regarding the hospital budget, specifically the lack of policy for writing off bad debt and a decrease of $2.1 million in the hospital’s bank balance.

“We had requested some specific documents from the hospital and … we did get those documents and was able to look through that, and I just wanted to provide an update on that,” Moyer said. “So, this is coming out of the workshop that we had with the hospital commission, the joint workshop that we had, and I think the best place to start is we’ve been asking a question for seven months. That question is: What is the status of the financials for the hospital?

“We’ve gone at it a lot of different ways, and I think at the end, there should be an answer about what the actual financial status is. We’ve been told that the hospital is breaking even or even making a profit, but the truth is that when you look at the financial record, there’s a couple of things that stand out.

“One of those is that the bank accounts show a decrease of over $2.1 million. That doesn’t suggest a break even. The other thing that sort of came out from the workshop was this aging accounts receivable, a liability that’s been carried on the balance sheet.”

Moyer has mentioned the hospital not having any bad debt in its budget for 2025 when it has had bad debt in previous years. At a recent joint workshop, hospital chief financial officer Cynthia Asbury told the council that the hospital hadn’t had any bad debt returned to it this year.

“We learned at the last joint workshop that the hospital has failed to adopt a bad debt policy,” Moyer said. “I remember specifically asking: ‘What is your policy?’ They said they did not have one. As a result, they have failed to post bad debt on the income statement since the beginning of the year, and this is contrary to years of history beforehand, when bad debt was posted monthly. So, this started at the beginning of 2025.

“After receiving an aging account schedule or something that looks like that, that shows us what this is, a lack of a policy basically allows the hospital to record what is essentially bad debt on a balance sheet in perpetuity. What that means is, so if you remember, this is a financial record that we asked for in April and we didn’t receive until July. When we finally got it, we’re able to see the accounts receivable line item and the liabilities sitting there, over $3 million, which is historically higher than any other record that we have for accounts receivable. So, at the workshop we asked for that aging schedule, and what we found, after them providing that information, thankfully, is that the hospital has just failed to account for it as bad debt and post it to the income statement.

“If the hospital applied a federally adopted rule for bad debt, and this is coming from the Centers for Medicare and Medicaid Services, anything aged over 120 days would be written off. And that means it would move from the balance sheet to the income statement. What that would essentially do is reduce their net revenue.”

Not having a bad debt policy is making the bottom line look more positive than it actually is, Moyer said.

“So, this speaks directly to the current financial status of the hospital,” she said. “I can think of two reasons why the hospital would continue to operate without a bad debt policy. One, they don’t know that they should have one, and they don’t understand the impact. Two, they know that when they do, it will significantly reduce the net revenue line and leave the financial outlook much less appealing than what we’re being told. But, either way, I think that’s negligence.

“If you apply the federal standard of 120 days to the hospital’s aging AR schedule, it reveals that the hospital is failing to acknowledge a $1.1 million loss. So simplified, a reduced bank balance of $2.1 million and a $1.1 million amount in bad debt is less revenue. That’s what’s being reported to the council and the commission since the beginning of the year. That does not look like breaking even or a profit. That looks like a significant loss to me.”

Moyer told council members she “hates being in this position,” regarding continually bringing up questions about the hospital’s financial condition.

“To continue to bring this up, seemingly every meeting, is very difficult for me, because I don’t want to be contentious,” she said. “I think that most of the people working at the hospital are trying to do the right thing, but I do feel it is the responsibility of this council to respond to the community who brought this issue to us months ago, and we’ve done our best to follow through. I’m proud of this group for doing that, which is simply responding to our community’s concerns.

“It started with personnel issues, it moved to a lack of financial reporting. Misrepresentation has resulted in the loss of community confidence. It ended with initial failure to comply with council requests to the point where we had to pass an ordinance to get basic financial documents and reporting. All of this points to what I think the community was trying to alert us to in the first place, which is a failure of leadership.”

Moyer said she has recommendations for the hospital’s new CEO, Tiffany Means, who was present at Monday’s meeting.

“The question still remains: What is the financial status of the hospital? To be sure, I would recommend the following things to the commission and to the CEO, Ms. Means,” Moyer said. “I would strongly recommend that the commission pay for a third-party review and a reconciliation of the financials as a basis for charting a secure financial future. I would strongly recommend that Ms. Means and the commission work together to revise a budget for 2025 to inform confident financial decision making.

“The commission has chosen this direction for leadership and I believe that we should support Mrs. Means in this venture in leading the hospital. But, I believe this means that new leadership at the commission level is necessary.”

Council member Harry Meyer called out Asbury.

“I think it’s been pretty obvious that financially the chief financial officer is kind of swimming in deep water,” Meyer said. “She doesn’t seem to know what is supposed to happen and it’s difficult to just kind of sit back and watch it continue to happen.”

Gruning agreed. “…When the hospital was here, and the CFO was answering questions, she appeared to be answering questions, but then our council member, council member Moyer, goes back and does the due diligence, reviews everything, and we still come back with a discrepancy,” Gruning said. “And it just doesn’t end. … And then, and I think that every time it comes back, there’s a different answer. There is something still broken. I don’t know if the CEO is going to be the answer reviewing this, but something is definitely wrong. When our hospital commission chair [Sandy Martin] comes to speak to us… I know that she’s very intelligent in what she does, but she can only go with what she’s being told, and she doesn’t have probably the time to do the work. We shouldn’t have to do work, but we’re doing it because we have a dedicated member here who is reviewing this. There’s a big issue that there is a loss … and this reporting not being done correctly.

“Our hospital’s in trouble.”

‘I WILL HAVE A BETTER GRASP’

Eureka Springs Mayor Butch Berry asked Means to address the council regarding Moyer’s questions and the budget.

“I think that we’re still not getting the answers to you in the manner that we all can agree upon,” Means said. “… The workshop that we were at, I said we needed to be able to be more transparent and communicate better in the manner that we need to for the community that they deserve to know this information. So, as we finish our August financials, I will have a better grasp because I’m technically only in about 30-some days now. I’m able to grasp more of the financials from not only the past, but August and the direction that they’re going to. We have opportunity to improve ourselves and it is my every effort to make sure that we’re transparent in that manner.

“Again, there are a lot of positives in the last 30 days that I’ve been here. I can’t really specifically share what those are at this moment, but I know that with time, we’re going to grow. It hit a hiccup in the road in 2024. It takes time for the hospital to be able to rejuvenate and gain momentum back and trust in the community back. It’s not going to happen overnight, but I can tell you that if given the opportunity, I would like to share with you more of what you guys are wanting from us.”

Means told the council that she did review the budget numbers that Moyer referenced and felt as if the hospital was “meeting it.”

“But, again, maybe I’m missing the point here, and the $2.1 million is coming up, the bad debt is coming up, and the write-off is coming up,” Means said. “So, I need to dive deeper into that piece and be able to bring you answers to that. But again, we’re seeing more numbers at the hospital, and I think that with the care that we provide and we continue to serve the community, I think there are going to be more positives and more generating revenue coming out of the hospital. But again, it’s just going to take some time.”

Moyer said she felt for Means coming into the position with the facility having so many financial questions.

“… What I see in the financials is negligence,” Moyer said. “And I hate for you to come into this position, and offer the leadership that the hospital needs and not have a solid financial footing under you. So, I am motivated to try to support you in your position by bringing these things to the public and to you to say to look carefully at the revenue. … It is so important that you get a review and a reconciliation of the hospital financials and not to take anyone else’s word that everything is good and that we’re breaking even and we’re making a profit because that is not what this says to me.”

Means replied: “OK.” “So, I just encourage you to do that and to find a way to develop a revised 2025 budget so that you can make solid decisions moving forward,” Moyer said. “If this fails, and I would hate for that to happen for our community, for you, you’ve just taken this position — and I have all the confidence in the world that you’re going to be great at it — I want you to have a solid financial footing with which to lead forward. And I think that is why I am saying this, not to be difficult.”

“I appreciate that,” Means replied.

1 CONTRACT EMPLOYEE REMAINING Means told the council that the hospital has just one contract labor employee remaining, with other positions now filled by full-time employees.

“We’re just not hiring to hire,” Means said. “These are well-vetted, interviewed nursing staff and medics that we feel confident in serving in the emergency department and serving our patients. So, I think that in the last 30 days, I can say that’s a positive for us financially.”

Meyer questioned staffing for the lab, saying he had learned that a “very important person” who worked in the lab was recently let go.

“And they were responsible five days a week, 24 hours a day if I’m not mistaken, so the lab shut down,” Meyer said.

Means quickly disputed Meyer’s comment.

“No, it is not,” she said.

“Do you have someone in the lab 24 hours a day that’s qualified?” Meyer asked.

“We officially finished our first full week, fully staffed with our own staff,” she responded. “So, we are fully staffed. We covered every single shift in the last seven days with our own staff. That’s another positive for us because that is a big goal. When I came in, lab was the priority of making sure that we are open 24/7.”

KEEPING TABS ON STAFF OPINIONS

Means also told the council that she surveys her staff once every six months to get an idea about opinions of how things are going.

“I’ll tell you what I do,” Means said. “I do a Survey Monkey with all the staff about 60 days in. It’s an evaluation of how they think that I’m doing, and then it’s an evaluation of how they feel the hospital is doing. And then if there’s any other issues that go along with it, this is something standard that I normally do when I go into these positions.

“What better way is to get … kind of, you know, a mirror approach, tell me how you think you’re doing, and then I’m in my leadership meetings telling how I think we’re going and all of that. And then what it does is it does open up opportunities that if there is issues, I will look into those issues. If somebody anonymous says, you now, I feel like there’s workplace violence or bullying or anything going on to that, that makes me dive deeper into that conversation. Right now, we are about, I can say, getting core staff, just from my knowledge, 80 percent maybe are new coworkers in the last four to six months. So I think it would be a good opportunity for us to, for me to survey the team and then be able to work on that. And then what I do in six months, I ask the same questions through another Survey Monkey. So they know I read everything, how they feel everything is going well, what their concerns are, and then in six months, did they feel like there was action taken?”

Meyer said that even though Berry stresses to the council frequently that things such as hospital personnel aren’t under their umbrella, it still would be an act of transparency if Means could give updates regularly at council meetings.

“I understand it’s not something that we can manipulate, hire, fire, or order to be done, but it would be very nice, since you’re here new, and things are improving you say, is that we, while people are still worried about the condition, I’m talking about the populace, I am talking about the citizens of Eureka Springs, coming here and just giving us a report on how things are going,” Meyer said. “It goes out to the city, it’s on YouTube, that would be a very nice thing. You don’t have to take questions….”

“Mr. Meyer, I don’t want to interrupt you, but Ms. Means and I have discussed doing that and having her come before the council once a month to report the status of the hospital,” Berry said.

“Well, OK,” Meyer said.

Gruning chimed in, saying “Well, that’s awesome. Again, we didn’t know.”

OTHER COUNCIL ITEMS The council tabled a vote on a new ordinance raising ambulance rates, an action that is being taken by cities across the state after a new law was put into place.

The rate increase would only affect those who are uninsured, fire chief Gary Inman has said.

“The reason for the ambulance rate increase is because there’s been law change that allows us to bill a larger amount that the insurances are now bound to pay 325 percent of the Medicare rural rate,” Inman said. “… As you can see, according to the census, we do have 41.75 percent that has private insurance, which I believe was a question the last time, and the people that it would negatively affect are the ones that are completely uninsured, and that number is 8.83 percent. And of course, these numbers are a couple of years old, but they’re the most current numbers that we have now to base it off of.”

Inman said it costs the Eureka Springs Fire Department $1,823.11 to make an ambulance call and the department is only reimbursed $747 per call.

“So, we’re doing better than the national average as far as the loss goes, but we’re still taking a loss on these numbers,” Inman said. “And the biggest reason that we’re taking a loss is because of what happened in 2022 was when ambulances fell under the No Surprises Act. We’re no longer able to go back and collect anything beyond what insurance pays. So it kind of makes sense that we try to collect as much as we can from the insurance companies.”

After some discussion on the best way to proceed, the council agreed to have an ordinance drafted using language saying the city will charge 325 percent of the Medicare rural rate.

The council also approved the reappointments of Sharon Deramus and Willie Daniels as members of the hospital commission.