MEEKER | The Eastern Rio Blanco Health Service District Board and Pioneers Medical Center met last week. All board members were present as they started with their financial meeting at 9:30 a.m., followed by the regular meeting at 10 a.m. Both were open to the public.
Chief Financial Officer John Nadone stated that surgery volumes had rebounded, with 35 cases year-to-date, despite cancellations and rescheduling. This month, clinical visits were down by 6%, but up 5% year-to-date.
Outpatient services have been strong, while inpatient days came in below budget. Nadone reported to the board a $662,000 loss for the month, explaining that it was primarily due to an increase in AR reserves. They were able to back out non-cash depreciation, so the loss was less severe. He also explained how much they have in cash on hand.
“Overall cash on hand, we’re 160 days — that includes the restricted cash as well. So non-restricted, we’re at 129 now. Our covenant is 90 on that front. Just take a quick look at where we were in May 2024, you’re talking about $10 million, and we’re at $21 million now. That’s a sizable growth in just over a year, even if you back out the $2.5 million from the MRI.”
Nadone went on to explain the potential cuts to Medicare reimbursements in relation to 340B pharmacy revenue, provider fees, and grant funding that could end up costing the hospital an estimated $2–3 million annually if the worst-case scenarios materialize. He also mentioned that grants such as DOLA and CHASE are still active but could be frozen if federal or state policies shift. Labor challenges persist, due to staffing flexibility and the cost of contract labor.
After the financial meeting, the board moved into its regular monthly meeting. They approved the agenda and minutes from the previous meeting, with minor corrections to reflect accurate nominations for board officer roles. Vice President Regas Halandras clarified his nominations from the previous month.
“I made the nomination for Mark to retain the seat as president, myself as vice president, and then I nominated Sherri for the secretary/treasurer seat,” said Halandras.
After the clarification, the May minutes were approved, and the board opened the meeting for public comment. Mike Hoke, a former board member, was the first to speak. He addressed concerns stemming from a rumor that Ovation didn’t belong at the hospital. Hoke explained that during his eight years on the board, they used Quorum — now Ovation — and he was concerned about potentially losing support and services, including pharmaceuticals, if the relationship ended.
“I think we can keep our prices down because of what they supply us with — the oversight that they supply to the staff and to the board. When I had problems in the past, if I had a question, I could call Quorum. There was always someone there to answer my questions and help steer me to an answer to what I had. I guess in my mind, from what I’ve heard — and hope that’s changed here recently — it would be a big mistake to not have Ovation oversight in this hospital,” Hoke said.
In response, board member Wade Bradfield said he’s spoken publicly in the last couple of meetings with Ryan, an Ovation representative, about the public’s perception of the company.
“The public perception is Ovation rules the roost and has control of this, and the board — we’re just dummies according to Facebook or whatever some kind of derogatory term,” Bradfield said. “I said it would be nice to do at least an RFP and maybe look at some other management companies and do our diligence. If Ovation is the best and most expensive, stay with them. Maybe they’re the cheapest and do the best, but I think it would be good to just look at maybe one or two other companies because of the public concern and because of some rumors, unfounded or not — to just say, hey, and I think as a board that would be good, doing our diligence, and say, ‘Ovation offers this service for X, XYZ management company offers this,’ and we could at least make a decision to stay with Ovation, or at least we would be informed.”
Hoke said the board had previously researched management companies and that Quorum had been the best at the time. “They helped steer us from the county-run hospital to where we are today, and I think that’s a big accomplishment,” he said.
Board President Mark Schryver also weighed in on the discussion. “Back when I first got on the board, I did research, and Ovation was by far the best out there.”
Secretary/Treasurer Sherri Halandras also supported the RFP idea. “If they’re the best, they’re the best. If they’re not, they’re not,” she said.
Before ending his comment, Hoke asked board members to support the hospital’s foundation.
“Since I’m on the foundation board, I’m going to encourage everybody here that’s on this board to contribute to the foundation. If you’re 100% with this organization, I think you ought to be 101% and do what my wife and I do — contribute on an annual basis. I’m just going to encourage you to do that and show your commitment,” Hoke said.
Community member Bobby Gutierrez also addressed the board, expressing concerns about Ovation and hospital finances, nothing that Ovation emerged from Quorum’s 2020 bankruptcy.
“We’re currently $600–$700,000 in the hole — I don’t know — and we’re operating at a loss. I think it’s a good idea to look at other things,” Gutierrez said.
Gutierrez also brought up the agenda, referencing last month’s meeting where the board discussed returning to a seven-member board. He noted the agenda he printed out that morning did not reflect that discussion.
“There’s nothing on it to discuss on this agenda, yet you have something listed for executive session again and yet nothing about what’s going to be discussed in the executive session,” Gutierrez said.
Board President Mark Schryver pointed to item No. 14 on the agenda.
“What’s that say? ‘Seven-to-five member board discussion,’” Schryver said.
Gutierrez confirmed that his printed agenda — printed that morning — was missing the item. Sherri Halandras explained the updated agenda had not been uploaded to the website. In response to Gutierrez’s question, Executive Assistant Natalie Scritchfield said, “It was posted on Friday at the posting area out in the hall by the long-term care, and it didn’t get uploaded to the website until Saturday.”
The board discussed whether the current legal posting site is accessible enough to the public and considered moving it to a downtown location like the post office. Bradfield emphasized that online updates should be timely.
“If we take the time to change the agenda or whatever and take the time to walk over and post it, surely it wouldn’t take 30 seconds to correct the agenda on the website. He’s saying he printed it off this morning and it’s still wrong — that’s something that should not happen,” Bradfield said.
CEO Liz Sellers presented the medical staff report and recommended approval for new and returning providers. New appointments include Dr. Jennifer Craig, who will start in August, and physician assistant Chris Dellinger, who started this week. Reappointments include Kristen Dillon, the lab director, and Dr. Elizabeth Ross, a physician in the clinic.The board then heard the audit review from Kami Matzek of DZA in Spokane, Washington.
Matzek said their firm works primarily with critical access hospitals and federally qualified health centers, with 95% of clients in rural areas. Jeremy Valdez, who was the manager on their audit and cost report, also attended. DZA previously worked with the facility four years ago.
Matzek reported that net service revenue increased significantly, from $8 million to $23 million, largely due to orthopedic surgeries and related services. She cautioned the board about future risks tied to Medicaid and Medicare reimbursement cuts — including both direct and supplemental payments — which total approximately $1.6 million in revenue.
“All of those payments are what’s being discussed in legislation right now — if we’re going to see cuts in those, I don’t know what the outcome is going to be, what those cuts are going to look like, but I will say that I expect that there will fully be cuts in some of those payments, and to expect that coming forward,” Matzek said. “Also on the docket is your 340B revenue, pharmacy revenues being looked at also. So just keeping that in mind as the board of directors, seeing what’s coming ahead — I would expect to see some cuts in that revenue source that the hospital has.”
To close the presentation, Matzek clarified that DZA’s role is to review management’s financial estimates, not to control or direct them — a distinction between management’s responsibilities and the auditor’s oversight role.
The board then discussed the issue of board size, specifically the change from a seven-member to a five-member board that occurred around 2022. The legal process used to reduce the board size was flawed, citing a statute that only allows for increasing, not decreasing the board size. A judge declined to validate the change and suggested the board seek declaratory relief, which was never pursued.
Secretary/Treasurer Sherri Halandras said multiple special district attorneys confirmed the process used was not legal. She noted that strong public interest remains, with seven candidates running for three seats in the most recent election — countering claims of low engagement.
Several board members voiced support for returning to a seven-member board to improve transparency and reduce workload. The board then entered executive session to receive legal advice regarding board size and litigation raised at the May 27 meeting under CRS 24-6-402(b).
When the executive session ended, the board announced they had authorized attorney Michael Santo to begin the process of returning to a seven-member board under Colorado Title 32-1-902.5. The meeting adjourned with the next meeting scheduled for July 22, 2025, at 9:30 a.m.