Originally created 08/31/02

Revived medical facility purchases MRI scanner



For proof of St. Joseph Hospital's financial turnaround, one need look no further than its new $1.5 million MRI scanner.

The state-of-the art diagnostic tool, which began operation about six weeks ago, is the most visible example of how the 50-year-old Catholic hospital is pulling itself out of the red.

"We wouldn't have spent that money, nor would our corporate office allow us to spend that money, unless we were on the rebound," said Ray Owings, the hospital's chief financial officer.

The nonprofit institution expects audited figures from the 2002 fiscal year to show an operational loss much less than the $6 million reported in 2001.

Like many hospitals, St. Joseph was hit hard by Medicare cuts contained in 1997's federal Balanced Budget Act. The reduced reimbursements, a loss of confidence by referring physicians and declined utilization culminated in a $10 million loss in fiscal year 2000.

The turnaround started shortly afterward when a new management team, which included Mr. Owings and current CEO Andrew Lasser, was put in place.

"We've known for several years that having a full-time MRI would be useful," said Dr. Lasser, referring to the mobile MRI unit the hospital previously rented two days a week. "It allows our patients to get the services they need here."

Physicians affiliated with the hospital are more likely to refer outpatients for imaging now that the facility has an MRI suite available five days a week. With the mobile service, St. Joseph averaged 10 scans per week. With the new GE-built Signa Infinity machine, the hospital has averaged 25 per week.

The purchase helps St. Joseph stay competitive with the city's three competing hospitals, all of which have MRIs.

MRI, which stands for magnetic resonance imaging, uses magnetic fields and radio waves to take pictures of the body. The painless procedure provides greater detail than X-rays or CT scanners.

St. Joseph's MRI features the most advanced magnet technology available and was designed with future upgrades in mind, said Robert McKellar, the chairman of the department of radiology.

"This will be a viable unit for a long period of time," he said.

The purchase was financed through industrial revenue bonds issued by the Richmond County Development Authority. The state of Georgia, which approves all medical equipment purchases and leases in excess of $667,201, signed off on the MRI early in the year.

"This will be a viable unit for a long period of time." - Robert McKellar, on St. Joseph's new MRI equipment

Reach Damon Cline at (706) 823-3486 or dcline@augustachronicle.com.