The history of Skiff Medical Center is a story of change. Thanks to the vision of F.L. Maytag, a hospital was born in Newton in a nine-room house leased from the Caleb Lamb family in 1917. It was soon replaced by a state-of-the-art facility funded by Vernon Skiff and named after his late wife, Mary Francis Skiff. Persevering through cost overruns during construction and financial woes that nearly closed the hospital during its early years, the hospital survived to become a city-owned entity in mid-1920s.
Along with the Maytag Company, the hospital was a pioneer in the area of health insurance, adapting to the changing environment of reimbursement for hospital care. It also adapted to the changing needs of the community – for instance, in the way it moved from caring for 152 moms giving birth in 1940, to 537 just 12 years later. In 1956, the hospital opened a new wing to meet the needs of a growing community and routinely had an inpatient census of more than 100 with 24/7 care provided by a staff of only 65! The construction of the addition was partially funded by a government program, the Hill-Burton program, which was the result of health-care reform legislation signed into law way back in 1946.
In 1964, Skiff built a second addition known as the Hunter Wing, funded by a large gift from the estate of Mr. Charles Hunter, as well as additional funding from the Hill-Burton program. This new wing increased the bed complement to 126 and the number of patients in-house at any given time far exceeded the total number of staff employed by the hospital. In 1966, the implementation of the Medicare and Medicaid programs transformed the face of hospital care in America. For the first time, a significant proportion of patients had guaranteed insurance that paid hospitals for the entire cost of the care they provided, effectively shielding them from financial risk.
The 1970s were a decade of innovation in medicine, as well as skyrocketing health-care costs thanks to advancing technology and the exceptional insurance coverage provided by government programs. Skiff took advantage of this environment and constructed a wing devoted to emergency and diagnostic services, funded by a gift of 16,000 shares of stock from the Maytag family and, once again, Hill-Burton money from the federal government.
By the late 1970s and early 1980s, escalating health-care costs were front page news across the country. The federal government responded by radically changing the payment mechanism for inpatient hospitals, moving from one based on reimbursing hospitals for the cost of the care provided, to one based on a much different formula which no longer covered the cost of providing inpatient care. This situation caused Ron Ross, hospital administrator at the time, to state, “We are presently faced with the most dramatic and rapid changes ever seen affecting the delivery of health services.” Skiff responded to these changes by slashing the number of inpatient beds in half, beginning a massive renovation and construction program focused on developing outpatient capacity and, in 1984, renaming the hospital to “Skiff Medical Center.”
In the 1990s, Skiff invested heavily in its program to develop outpatient capacity by recruiting many new primary care providers, increasing the number of visiting specialists, expanding outpatient facilities, and purchasing state-of-the-art technology. Skiff’s success in developing its outpatient capacity, and the strength of having a Fortune 500 company headquartered four blocks away, sheltered it from the ravages of changing reimbursement that caused hundreds of other rural hospitals to close during the 1980s and 1990s. The changing rural health-care environment led to the development of a new type of funding for rural hospitals, but the window for entering this program permanently closed in 2006.
Unfortunately, in 2007, Maytag closed and sent shockwaves through the community and the hospital. The number of patients using the hospital declined, insurance coverage changed dramatically, and there was a coincidental decline in physicians practicing in the community. It was too late to apply for the new government program and large financial losses began to accumulate. These losses were intensified by the national economic recession and led to the subsequent departure of the hospital leadership team and culminated in a large reduction in force in 2009 with bad feelings on all fronts.
The last four years have been devoted to rebuilding the hospital’s culture, vision and operations. Advanced technology in the areas of diagnostic imaging, laboratory, surgical services and physiologic monitoring have been acquired and the medical record is nearly paperless. New providers are practicing in town and more are on their way. Many areas of the hospital have been given a facelift and new equipment items have been replaced thanks to donations from the Skiff Auxiliary and the Skiff Foundation. New funding streams have been acquired and have served to offset reductions in payment from traditional sources, while efforts aimed at improving efficiency and decreasing costs have continued all the while.
In the midst of this work, health-care reform was passed and, quite literally, everything has begun to change across the entire health-care industry, with hospitals large and small facing a great deal of uncertainty. Huge cuts in payment for health-care services to offset enormous increases in federal debt, combined with large scale movement of services to non-hospital environments, are projected. To paraphrase Mr. Ross in 1984, health care is in the midst of a transformation not equaled in the history of modern medicine.
So where does Skiff go from here? One thing is certain, Newton and Jasper County must have a hospital, so a future without Skiff is out of the question. This is the lesson I learned when my son was emergently admitted to another hospital more than a year ago, an event which I documented in the opening article of this series. Since that time, I have had another child emergently admitted, only this time it was one of my daughters and it was here at Skiff. Suffice it to say, ensuring our continued existence is my top priority!
But just existing is not enough. The future of our community hinges on having a robust hospital, but the future of our hospital hinges on having a robust community. This is why I, personally, along with other Skiff employees, am so involved in many community organizations and community development projects. We have a responsibility to support the growth of our community and we also benefit as a hospital from that community growth. But growth takes a long time, and we may not have time to wait. This is why we approached our friends in the city to see if that ownership relationship could be of help. Unfortunately, some elements of Iowa law limit the assistance a city can provide to its affiliated hospital and explains why none of the 14 municipal hospitals in Iowa (including Skiff) receive any tax support. Interestingly, all 42 county hospitals in Iowa receive tax support, but a county-wide referendum would be required for Skiff to take this path.
This is why we are taking the time right now, while we still have resources and retain control of our destiny, to do a check-up with some outside help. We are working with a firm called Clifton|Larson|Allen from Minneapolis who specialize in helping hospitals, especially rural ones, find their way through a changing and exceptionally murky health-care landscape. Many of our physicians, employees and community members have been participating in this process and we hope to have it wrapped up in early June. The outcome of this check-up will help us understand our best path forward.
Given the level of integration of hospitals that is currently happening in Iowa, and around the country, it is likely that our future path will involve coordinated efforts with other hospitals, although the tightness of those potential relationships is a question to be answered in the future. What I do know is that, while we consider that option, we need to continue our work to be absolutely the best hospital our community could ever hope for.
This will include recruiting more physicians. We have several considering offers and a few already committed to coming to Newton (Dr. Rachel Knudson, a general surgeon who will be arriving in August, and Dr. Jennifer Paisley, a pediatrician coming in October). It will include investments in technology, including the new endoscopy suite that has been the focus of our fundraising efforts for the last year, the new telephone system we are about to install, and continued renovation projects to create an even more focused healing atmosphere. It will include more efforts at improving the efficiency of our processes and programs. It will include additional improvements in our quality scores and in our patient experiences. It will include providing our employees with the tools they need to make the best possible difference in your care, as well as a clear vision for our future path.
It will also include a change in the name of the current city-owned hospital to Newton Municipal Hospital. But we will still be Skiff Medical Center! You see, we are developing a new not-for-profit hospital organization that will work side by side with the current city-owned hospital. While together these two entities will be known as “Skiff Medical Center,” only one can legally have the name, so that will go to the new organization. The development of this new structure is required to allow us to better adapt to a future that may include partnerships with other hospitals and is also required for us to begin to transition to a lower cost retirement system for our newer employees, our future employees, and those current employees who want to take advantage of a new retirement plan.
I am enthusiastic about the future of Skiff Medical Center! There has never been a more challenging, or exciting, time to be working in the health-care field. We are standing on the cusp of a fundamental transformation of the American health-care system that will see us become focused on ensuring the residents of our community live the healthiest, happiest and longest lives possible. Technology and information science will allow doctors and hospitals to work together to improve the lives of our patients in ways we never dreamed possible!
What began as the Newton Hospital Association in 1917, then became Mary Francis Skiff Memorial Hospital in 1921, then Skiff Memorial Hospital in the 1960s, and finally Skiff Medical Center in 1984, with a new logo in 2010, is still here today. Though the name may have changed through the years, one thing will always remain – our commitment to being in Newton and providing absolutely the best care close to home!
It has been a pleasure writing this series on the history of Skiff Medical Center. If you have any questions or thoughts on the information I have provided during the last several months, please contact me at slong@skiffmed.com.