At a time when rural hospitals are seeing increasing financial pressures and closures, Leadville, Colo.-based St. Vincent Hospital is defying the odds with a $6 million financial turnaround.
The hospital saw a $2.2 million loss in 2023, but with proper leadership, operational focus and a commitment to serving its local community, the system reported a $3.5 million profit in 2024.
Becker’s recently connected with the hospital’s interim CFO Kelly Johnston and CEO Andy Dreesen to discuss the strategies and key decisions that went into revitalizing the hospital’s finances, and what other rural health leaders can learn from their experience.
Editor’s note: Responses have been lightly edited for clarity and length.
Question: What were the key financial decisions or strategies that contributed to the $6 million turnaround from 2023 to 2024?
Kelly Johnston: Over the last two to three years, we’ve focused on making St. Vincent … a facility offering services the community really needed. When I first got to the organization, there were a bunch of additional service lines that weren’t fully implemented, taking resources away from providing good patient care, including emergent services, inpatient swing, clinic, and primary care services. We’ve really distilled St. Vincent down to make sure we’re serving the community’s core needs. It’s that philosophy of making sure that our systems are in place, our processes are in place to be able to get paid for the work we’re doing, but also at the same time, making sure we’re serving the community.
I think the organization, prior to those changes, kind of deviated from that and as a result it stretched resources too thin [and] resulted in the financial hardship that I walked in on. We also collaborated with our county and state partners in order to figure out ways of surviving the first couple of months of the turnaround to be able to get back on track. We had a lot of vendor relationships. We were able to work with our vendors on extending terms so we could catch up our payments with them, but … still offer really good patient services. We had a lot of amazing team members that were passionate about care, but the problem was, everything was spread so thin we couldn’t do anything well. Getting back to our core services, offering good service and making sure we got paid for the care that we were providing ultimately resulted in a huge swing.
Andy Dreesen: Really focusing on leveraging the staff that are here, they are incredibly loyal and dedicated to St. Vincent. Our community did want to see the hospital succeed and was willing to help out where they could. Really focusing on that aspect and getting back to the foundation of rural healthcare, providing care to our community, in our community, I think, was critical. Turning focus onto the recruitment of providers [and] key players in revenue cycle, case management, to really leverage what we’re able to offer and being paid for the services that we provide.
Q: Becker’s has reported on 15 hospital closures so far in 2025. Why do you think we’re seeing these closures? Do you have any advice to combat this?
KJ: There are a couple of things [that] drive these closures:
Oftentimes when I go into hospitals that are not doing financially well, it’s a common theme over and over again. First, we see the facilities deviating from core services for that community because they do want to be able to compete with the bigger systems, when, in all reality, if they just offered the core … request of their community [and] did not deviate too much, they could stay financially sustainable. We can’t compete in the rural hospital space on scale like our big PPS facilities can. If we do what we do well and we create strategic partnerships with those organizations, we can still get those services to our constituents, but without overextending ourselves.
The second thing I see as a big common theme is revenue cycle management. Oftentimes, the teams that are built in the revenue cycle process are not really understanding cost-based reimbursement for critical access hospitals, and as a result, case management is not managed effectively around how we get reimbursed. Two, there’s no follow up in terms of insurance claims and those billed to unpaid claims. Three, we’re also not managing denials or having a feedback loop with the clinical team on what is getting paid versus what is not getting paid. On top of that … there oftentimes isn’t any standardized process or workflow built out of the organization. If you button down on the revenue cycle most of the time, you can actually make really good headway. The little guys, it’s a lot harder to fight the commercial insurance payers when they do not want to pay nice, per se, but at the same time, if you do actually have the data and you can communicate with those payers, nine times out of ten, they’re really willing to work with you. A lot of the time, I just see that the rural healthcare providers are not taking the time to really draw attention to issues that they’re having with payers, or looking at those payer contracts.
At St. Vincent, we hadn’t updated our chargemaster since 2015 or 2018. [Because] of that, we were not paid properly or comparative to market for the services we are rendering. I see that same trend over and over. Recruitment challenges for providers, depending on how rural the town is, it is hard to engage the different levels of provider services that are needed. [Finding] a way to make the rural healthcare facilities look really appealing [is needed] to attract solid medical talent.
I see recruitment and physician management as a huge area of opportunity in rural health. Last but not least, especially in the turmoil that we’re seeing in changes of leadership politically as well as policy changes, really understanding different care models that are available and different payers and how they work is super critical. Most of our critical access hospitals are a really high Medicare and Medicaid payer mix, but there’s a huge lack of just general knowledge around how Medicaid Medicare works. Continuing to bridge the gap between the community, our legislative officials and whatnot, and to understand how it does impact rural health is also key in order to have those working relationships to overcome the hurdles.
AD: On the recruitment front, my biggest focus has been to not just hire a body or hire the right fit, but really focus on the long-term sustainability, versus the “stop the bleed” type of model.
[Transparency] I think is an important factor. From the community standpoint, I don’t know that there was a lot of transparency in the past, so to sort of be blindsided with this financial crisis by the facility was probably a tough pill for them to swallow. Whereas, if they were kind of communicating along the way, I think there would have been even more support than what there already was.
Q: With St. Vincent now exceeding expectations for a facility of its size, what steps are being taken to ensure long-term financial sustainability?
KJ: I think the first thing is making sure that the processes that are developed for this turnaround are documented, trained on and duplicated over and over again. Really working through [standard operating procedures] or checklists or everything from the front desk and the minute that patient calls and makes an appointment or presents, all the way to the back end of the cycle to where we get finally paid or close out the claim, and that includes everything in between, including the clinical aspect of it.
The other piece is that knowledge is not just staying with certain individuals. It needs to be spread across the facility, from management all the way down to the frontline team members, and engaging those frontline team members all the way back up in terms of feedback loops, etc.
We’re really wanting to continue on a habit of forecasting and working through strategic financial planning for any decision that is made within the organization. As we come back from our financial hardship, we’re now talking about what can we do to grow and what good growth looks like, versus what we experienced in the past, where we over-diversified and making sure that there’re financial steps in place to forecast for what those changes look like to that way, that decisions are way more educated in nature.
Another [great investment] is board involvement [and] board education. A lot of these rural hospitals and critical access hospitals — St. Vincent was no exception — have community members that are volunteering to be on our board. Having our leadership team really engage the board in their role in that strategic plan and keeping them educated through our hospital associations and whatnot, so that way they can also make sure that this is sustainable in the long haul, is super, super critical.
AD: CEOs and CFOs have their own vision, in a sense, their ideal world. I think pairing that with the data-driven decisions is key. The transparency with the board, their staff, their community and tying in that data element of, this is why we’re going this direction, and this is the data to support it will set us up for long term sustainability.
Also, ensuring there’re checks and balances across the organization to make sure that decisions aren’t made unilaterally. If you talk to any of our senior leaders here, they know that they’re involved in decisions, and of course, the board is as well, so [it’s important to ensure] that stays in place.
