Welcome to Smith County Memorial Hospital   Letter from the CEO

Smith County Memorial Hospital is a 25 bed not-for-profit Critical Access Hospital with an attached 28 bed Long Term Care unit and a Rural Health Clinic, located in Smith Center, KS.

The hospital was opened June 7, 1951, and on December 12, 1971, the Long Term Care Unit was completed.  

In 2004, construction was completed of the Gardner Wellness & Physical Therapy Center, the newest addition of the hospital. This addition has provided much needed space for the Physical Therapy department as well as provided space for Cardiac Rehabilitation and a pool to provide aquatic therapy.

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When a community is asked to raise taxes in any way, there are always questions to be answered.  This November 4th the Smith County Memorial Hospital is asking Smith County residents to vote yes on a 1% sales tax that will go towards operating costs at the hospital.  We would like to answer some of the frequently asked questions about this issue.

These funds (1¢ per $1) will allow the hospital to survive an economically difficult time and provide essential healthcare services right here in Smith County into the furture.

The New 1% Sales Tax will:

  • Be only 1¢ for every $1 of taxable purchases.
  • Be used by the hospital to continue quality health care.
  • Be collected county wide, meaning much of the tax will be paid by visitors to the area.
  • Help the hospital
    • Broaden the range of services,
    • Support our staff and providers
    • Purchase needed equipment
    • Pay off expenses
    • Plan for future renovation or a building project.
  • Be audited annually by an independent, external auditor to verify appropriate expenditures.
  • Be managed by the Smith County Memorial Hospital Board of Trustees.
  • Allow SCMH to continue the quality care we’ve provided over the years and encourage economic growth in our community.

Q:  Why does the hospital need this tax revenue?

A:  Smith County Memorial Hospital, a not-for-profit organization, does not have the reserves to meet all the funding requirements for rising operating costs, as well as upgrading technology and its building.  There are many reasons this increase is needed, but here are a few of our major issues.

Rural hospitals all over the country are finding themselves in financial difficulty. The federal government, in particular, has created many new rules and regulations that cost a great deal to comply with. Among these are the mandate for hospitals to implement Electronic Medical Records. The government pays us only a portion of the cost associated with these expensive computer systems. Although we have achieved efficiencies in the costs through our group affiliation, we still find the cost far exceeds the reimbursement. We expect the costs to increase in coming years as the rules associated with the electronic records change each year.

While the cost of services, equipment, and staffing continue to rise, the amount we are actually reimbursed for providing services has actually decreased. Beginning in 2012, the federal government, as part of a budget initiative, imposed a 2% decrease in the reimbursement we are entitled to for Medicare patients. Smith County has one of the highest percentages of Medicare beneficiaries in Kansas, so this impacts us heavily.

Healthcare staff are among the most highly technical professions in existence. Although we try very hard to hire, educate, and train the necessary staff for the required positions locally, sometimes this is not possible. On occasion we need to resort to using temporary staffing agencies to provide personnel that are not available locally. These staffing agencies are very expensive. For this reason, we continue to actively recruit for candidates to fill our needs, but have to incur costs while we do so

We know that it seems that your bill for services is high, and that we ought to be able to do well with the money from patient bills. Unfortunately, the amount you see a “charge” for each service we provide does NOT represent what we are paid. Medicare pays us an average of slightly more than 60% of what we bill for services. Many times, Blue Cross reimbursement is even less. We have no control over what we are actually paid. Imagine trying to run a business where the customers, not the business, controlled how much they would pay for goods and services.

Like many hospitals, we have depleted our financial reserves over the last five years.  This sales tax increase will help make up for these challenges we have been facing financially.  It will allow your hospital to get back to a positive bottom line and allow for planning of future change and growth.  A penny of every dollar spent in Smith County will make all the difference.

Q:  What will happen if this sales tax doesn’t pass?

A:  There is not an easy answer to this.  If this Sales Tax proposition fails the hospital will have to consider other funding options and/or make some difficult decisions on cutting certain services or staff.  The financial challenges brought on by the situations listed above are not going to go away completely any time soon and with constant changes and cuts being made to various programs we rely on, chances are we would not be able to survive as we are now.  With our financial reserves being depleted over the years we are finding ourselves in greater need for funding than ever before. 

Q: What is the difference between this sales tax and the current 1% sales tax for health care?

A:  There is a large difference between the two. 

The current sales tax, approved by voters in 2008, is used by the County Commissioners for all health care needs in Smith County. A large portion of the sales tax revenue does go towards debt payments on a bond issue for heating and cooling systems at the Hospital. But in addition to the Hospital, the commissioners have used these sales tax funds for other healthcare services in the county, including Emergency Medical Services and High Plains Mental Health Services. The Commissioners determine each year how much of the collected revenue will be spent, and how much will be held for future needs.

The new 1% sales tax will go directly to the Hospital to be used for operating costs. The Hospital Board of Trustees will control and distribute the funds specifically as needed for day to day operations, to purchase equipment, and to ensure the continued provision of high quality healthcare in Smith County. The Board and Administration feel as though the expected funds will cover the challenges we currently face and allow us to plan and partially fund the future of SCMH.

Q: Are we building a new hospital?

A:  This has not been decided yet.  Preliminary plans have been created for either a new facility or a complete renovation.  It is important to the board and administration that we have a logical plan in place before we move forward on a major building or renovation project.  We feel as though this sales tax is the most logical way to ensure we are on solid ground as we move forward with our plans.  That being said, it is important that we create a plan soon.  The current facility is over 60 years old and though we have worked hard to keep it usable we are facing an uphill battle.  We would like to furnish our outstanding medical providers and staff with the space to provide the quality care our community deserves. 

We’d like to hear your questions.

If you have a question, give us a call at 282-6845 ext. 204  or send us an email at development@smithcohosp.org


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Department of Health and Human Services
Kansas Medicare Website
Kansas Department of Health & Environment
University of Kansas Medical Center
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