Valley Health officials outline contributions

September 24, 2010, By Rebecca Layne WINCHESTER- Valley Health officials gathered Thursday to spread the word that the nonprofit organization is a good neighbor. During an information session in the Valley Health Wellness & Fitness Center on the Winchester Medical Center campus, they discussed their 2009 Community Benefit Report. The presentation illustrates the challenges the six-hospital system has been facing in the economic slowdown and the efforts it has made for the community. For the remainder of the article ... http://winchesterstar.com/articles/view/valley_health_officials_outline_contributions

Nobody in this area is going to dispute the facts that Valley Health Systems provides a lot of great valuable services and gives back to the vast regional communities that VHS is operating in as a not-for-profit institution.

Is it not time for the local media to start stating "regional community" for Valley Health since they serve many counties outside of Winchester and Frederick County.  VHS serves 18 counties to be exact.

The charity care and bad debt are isolated benefits to those individuals in need.  The programmatic community benefit has an affect on every individual within these regional communities.

The programmatic community benefit (community health improvement & community benefit operations; health professions education; subsidized health services; research; cash and in-kind donations) amounts for years 2009 back to 2005 are 7.1, 7.6, 1.3, 1.7 and 2.9 million respectively.

Wonder why Mr. Whitworth Jr. did not share nor the community benefit chart display the excess of revenue over expenses figures for 2005-2009?  To be more precise, profit/loss figures.

Valley Health System's five year profit total for years 2004-2008 was a little over $218.6 million.

But don’t be misled here, for-profit hospitals that pay taxes, has charity care too, bad debt and also gives back to local communities as this side-by-side comparison link below will show in detail.

Healthcaresoundoff.com’s comment on the comparison: “Valid comparison.  Roll with it.”

2007 Winchester Medical Center / Lewis-Gale Medical Center side-by-side comparison

A couple of notable highlights of the 2007 comparison, Lewis-Gale Medical Center paid $12.1 million in taxes as compared to Winchester Medical Center’s $162,362 (one hundred and sixty-two thousand and three-hundred and sixty-two dollars).  Winchester Medical Center had a profit of $66.6 million as compared to Lewis-Gale’s $11.9 million.

Valley Health’s community benefit report information for years 2005-2007 was taken from the pamphlet mailer.

The Big Picture, VHS's 2007 Community Benefit

 The 2008 numbers were taken from VHS’s mailer, no link provided and 2004’s numbers were taken from VHS’s former website.

VHS's 2004 Community Benefit

To get a better understanding of the breakdown of VHS’s 2007 $56.1 million in community benefit.  Again, got a perspective from Healthcaresoundoff.com:

Healthcaresoundoff's perspective on VHS's 2007 CB of $56.1 million

Also, do not forget about how profitable that the “Winchester Medical Center” was for years 2001-2007 where their profits increased 460%.

2001 - $11.8 million (per Quad State Biz Journal)
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2005 - $54,346,679 (per IRS990)

2006 - $57,422,678 (per IRS990)

2007 - $66,617,961 (per IRS990)

The Wellness Fitness Center brought in $1.1 million in revenue in just their first 3 months of operation after opening their doors in September of 2008.

Just before the wellness and fitness center opened in September 2008, it had collected 3,200 applications for membership.

Kent said the goal was to reach 5,000 members in three years, but it has moved beyond that. “We hit that number in a year,” she said, noting that the center now has 5,800 members.

Wonder how much revenue did the Wellness Fitness Center generate for 2009?

 

More information on the Zoning Violation issue from August, 4th WincStar article:

The issue arose when Diem determined that the wellness center was violating the city zoning code by marketing its services to the public via a website, direct mailings, and advertisements in The Winchester Star.


Diem sent WMC a letter stating that its marketing efforts must cease because they violate terms set for buildings in the Medical Center zone. Private health clubs are allowed in the zone, but they cannot be marketed publicly.


The zone's definition - including the prohibition on public marketing - was written and submitted on WMC's behalf in 1989.


Butler and hospital officials and board members argued before the BZA that "personal services" best describes the use of the wellness center, a use that allows public marketing.


The BZA quickly rejected that argument, but did not vote to make the wellness center immediately cease its marketing campaigns. Instead, it gave WMC four months to seek an amendment to the zoning code that would enable the center to be marketed publicly.

 
Information from September 8th WincStar article:

The wellness center issue stems from a determination made in May by Vincent Diem, the city's zoning and inspections administrator, that the center was violating the zoning code by publicly marketing its services.


The city zoning ordinance states that recreational facilities and private health clubs or sports-medicine clinics are permitted in the Medical Center District. However, the ordinance includes a provision that the facilities cannot be "marketed to the public-at-large."


Ironically, the restriction was included in an amendment written on behalf of WMC in 1989, and passed by the City Council in 1990.

After reading quotes and statement from the Quad State Business Journal article back in May of 2006, it is safe to say that VHS’s projections were somewhat conservative:

In projections used for COPN (Certificate of Pubic Need) approval, Valley Health said it is looking at a membership of 4,000 persons, targeting the 35-to 80-age group, especially people who don't exercise, said Kent.

"I have met with owners of the local clubs, and some say we will take members away from them," said Kent. "But we are hoping to attract people who don't exercise. In most markets, commercial clubs did not go out of business; their memberships actually went up because of the increased awareness of fitness."


Valley Health is projecting the wellness center business will break even in its second year, and after the third year will throw off cash flow of almost $1.3 million. Funding the cost of the center from Valley Health internal resources means there is no requirement for debt service.


"If it [wellness center] is such a big money maker, others would have come into the market."

The perception is that this information session that took place in the Valley Health Wellness & Fitness Center on the Winchester Medical Center campus on Thursday is most likely a result of City officials calling out VHS in violating their own zoning ordinance that the WMC had drawn up on their behalf back in 1989 and was adopted by City Council in 1990.

WMC zoning issue put on hold, BZA allows VHS more time

WMC had the zoning definition drafted up on their behalf back in 1989.  The BZA is giving the VHS an extension to hopefully get it right.

Not sure how more fair and reasonable the BZA could be than that?

Bottom-line, the Wellness Center does have an advantage over private-tax paying businesses by being tax-free.  Then it was realized the Wellness Center was making quite a bit of money with a large advertising campaign that was having some adverse affects on local private health clubs.

The zoning code within the medical center zone states recreational facilities and private health clubs or sports-medicine clinics services cannot be marketed to the public at large.

The local health clubs cannot afford those type of high dollar advertisements that VHS pays for on the Wellness Center.  The private local clubs just cannot compete with VHS's advertising campaign, they just have too much money.

Then a 50-yr agreement reached on March 4, 2009 requires the Wellness Center to pay 1/3 of their real estate tax just as long as the wellness center is operating as part of the medical center under the zoning definition that was drafted up on behalf of WMC.

If they are allowed to advertise, then that makes the playing field even more unbalanced.


Information from August, 4th WincStar article:

The issue arose when Diem determined that the wellness center was violating the city zoning code by marketing its services to the public via a website, direct mailings, and advertisements in The Winchester Star.

Diem sent WMC a letter stating that its marketing efforts must cease because they violate terms set for buildings in the Medical Center zone. Private health clubs are allowed in the zone, but they cannot be marketed publicly.

The zone's definition - including the prohibition on public marketing - was written and submitted on WMC's behalf in 1989.

Butler and hospital officials and board members argued before the BZA that "personal services" best describes the use of the wellness center, a use that allows public marketing.

The BZA quickly rejected that argument, but did not vote to make the wellness center immediately cease its marketing campaigns. Instead, it gave WMC four months to seek an amendment to the zoning code that would enable the center to be marketed publicly.

 
Information from September 8th WincStar article:

The wellness center issue stems from a determination made in May by Vincent Diem, the city's zoning and inspections administrator, that the center was violating the zoning code by publicly marketing its services.

The city zoning ordinance states that recreational facilities and private health clubs or sports-medicine clinics are permitted in the Medical Center District. However, the ordinance includes a provision that the facilities cannot be "marketed to the public-at-large."

Ironically, the restriction was included in an amendment written on behalf of WMC in 1989, and passed by the City Council in 1990.

Between the Winchester Star on April 9th and NVDaily's April 17th of 2010 front page articles, the following information was obtained:

(NVDaily) - The center, which opened in September 2008, brought in $1.1 million in revenue in its first three months of operation, according to tax records.

(WincStar) - Just before the wellness and fitness center opened in September 2008, it had collected 3,200 applications for membership.

Kent said the goal was to reach 5,000 members in three years, but it has moved beyond that. “We hit that number in a year,” she said, noting that the center now has 5,800 members.

After reading quotes and statement from the Quad State Business Journal article back in May of 2006, it is safe to say that VHS’s projections were somewhat conservative:

In projections used for COPN (Certificate of Pubic Need) approval, Valley Health said it is looking at a membership of 4,000 persons, targeting the 35-to 80-age group, especially people who don't exercise, said Kent.

"I have met with owners of the local clubs, and some say we will take members away from them," said Kent. "But we are hoping to attract people who don't exercise. In most markets, commercial clubs did not go out of business; their memberships actually went up because of the increased awareness of fitness."

Valley Health is projecting the wellness center business will break even in its second year, and after the third year will throw off cash flow of almost $1.3 million. Funding the cost of the center from Valley Health internal resources means there is no requirement for debt service.

"If it [wellness center] is such a big money maker, others would have come into the market."

The results of the study needs to be decided by a referendum

The perception is that more folks who do no live in Winchester are much more in favor of the closure of Millwood Ave.

Should not the citizens of Winchester have more say?

Once the Gorove/Slade group finalizes their study, should not their findings/recommendations be decided by the citizens of Winchester via a referendum?

A referendum, is that not fair?

Is the yield sign in front of the Armory a major contributor to the accidents?

Supporters for the Millwood Ave closure have cited a safety concern due to the accidents that have occurred at the Y intersection in front of the Armory when Apple Blossom Drive merges with Millwood.

Some City folks have stated that the YIELD sign is the problem.

Yield signs exist to remind us that many accidents occur at intersections when drivers lose track of who-goes-when. Many experienced drivers will classify yield signs as the most ignored traffic sign.

Maybe a STOP sign will make motorists more aware by requiring them to stop.

Some City folks have said that yield sign in front of the Armory is located in the wrong place that Millwood should have the “right of way” and the yield sign should be erected over on the Apple Blossom Drive side with those drivers yielding to the motorists traveling from Millwood in front of SU’s OBT coming into the Y in front of the Armory.

Long-standing right-of-way laws are something we usually learn when we first learn to drive. At that point we practice correlating common sense with regulations: any vehicle to the right of yours has the right-of-way, unless you're on the bigger road.

When anyone researches, they will discover intersections with a yield sign in place will result in a higher rate of accidents.

Is not the YIELD sign a major contributor to those accidents at the Y intersection when Apple Blossom drive merges with Millwood?

Would a STOP sign help to calm the so called "raceway" and make it safer for SU students to cross?

Shouldn't Millwood Ave always have the right-of-way sense it’s always been the main corridor entrance of Winchester?

By keeping Millwood Ave open, that’s more of an aesthetically pleasing entrance into Winchester in front of SU's OBT than Jubal Early, is it not?

Should scenarios be tested before making a final decision on Millwood closure?

Should not an official test of a couple scenarios take place before a final decision is made?

Scenario #1 – replace the yield sign in front of the Armory with a stop sign which would give students an area to cross without constant moving traffic for a month. 
    
Scenario #2 – put up temporary barrier to close off traffic from coming onto the Millwood piece down below Bob’s Evans and record traffic flow for a month.  That would be without a right turn-lane being added behind TV3.  

There is a lot speculation that traffic congestion will increase with that stretch of Millwood being closed off.  Now with actual tests being conducted, then this would give City Council real time results of such scenarios to make a well informed decision.