Is it now a medical resort, and a monument to it's managers and Board that the community can no longer afford to rely on for medical care?
In 2015 the VVMC made "excess revenues" (what the rest of us call profits) of $52,177,940.00
As of 4/30/2016 the VVMC held approx. $275,000,000 in cash, receivables, stocks and hedge fund investements
In 2015 the VVMC operated on a 24% profit margin. A recent survey of 750 non-profit hospitals showed an average margin of about 2.5%
A study of hospital finances in Western Colorado reveals that hospitals in surrounding communities operated successfully on profit margins of 7-14%
Since 2001 revenues at the VVMC have increased an average of 22.8% while profits have increased an average of over 100% per year.
The VVMC has about 547 days of operating expenses in available funds. This is about double what might be required to keep their current bond rating (at least in regards to cash reserves)'
For the first half of the 2015/2016 fiscal year (Nov 12015-April 30, 2016) the VVMC had "excess revenues" of over $31,000,000
The current renovation and additions were estimated to cost about $178,000,000 a year ago (source: VVMC bond disclosures) but the cost is now estimated to be $275,000,000 to $300,000,000 over the next four years (source: July 21st conversation with Doris Kirchner and Art Kelton)
The recent construction at University Hospital in Denver and Denver Health cost under $2,000,000 per bed. The VVMC addition and renovation is costing over $5,000,000 per bed
To pay for the expansion and $100,000,000 cost over run the VVMC issued $100,000,000 in bonds and will (presumably) take $200,000,000 out of its piggy bank over the next four years.
If current profit levels continue ($50 million a year) the VVMC will replenish its piggy bank handily by the time the project is finished.
And if enough is not enough, the VVMC has started a long term fund raising campaign with a stated goal of $75,000,000, competing with other local non profits who lack professional fund raisers that desperately need the money to continue their efforts.
Board meetings are closed and very secretive
Documents such as the corporate by-laws and articles of incorporation are deemed confidential
Requests for financial info beyond the tax returns are refused (but financial info is available if one finds their bond disclosures, which takes hours) but is here for your examination.
The VVMC disagrees with numerous suggestions of the Colorado Attorney General and the Colorado Secretary of State in regards to transparency as published in the Principles & Practices for Nonprofit Excellence in Colorado which is deemed to be a reasonable community standard as to what citizens should expect from a non-profit organization. guidebook for nonprofit management.
The Vail Valley Medical Center (VVMC) is a tax exempt organization that for decades provided reasonably affordable health care to the community making reasonable profit margins and building reasonable reserves to insure it could keep up, and a tax exempt hospital should be financially sound.
But since 2009 the VVMC has ceased to focus on affordable care and relentlessly increased prices and made skyrocketing profits by charging patients and insurers excessive fees for service, and has racked up unconscionable cash reserves, far beyond any reasonable need.
Here is a little background on how the Vail Valley Medical Center works and is governed:
As a non-profit tax exempt hospital the VVMC is required to eventually re-invest its profits in itself, there are no stock holders to pay or ever distribute profits to. The VVMC is owned by a non-profit parent company, Vail Health Services (VHS) who appoint the Board of the VVMC. VHS owns not only the VVMC but other interests such as a part interest in the Edwards Surgery Center which is operated in partnership with a local physicians group.
Vail Health Services is governed by a self perpetuating Board, meaning they appoint their own successors. Currently the Chair of VHS is Michael Shannon, of KSL Resorts and KSL Capital. Mr. Shannon is a part time resident of Vail, and formerly the President of what is now Vail Resorts. VHS appoints the Board of the VVMC, which is currently chaired by Art Kelton, who is a long time local Realtor.
So who really owns the VVMC and VHS? The answer is no one and everyone. Everyone would include area residents who depend on the VVMC for healthcare needs, even if only a few times in their life. This group is known as the stakeholders. While stakeholders do not have a vote in who governs the VVMC or VHS, they have inherent rights to expect the organization to conduct itself in serving the best interests of the stakeholders.
Doris Kirchner, a former employee of KSL, is the CEO of the VVMC.
The current Board of Vail Health Services as of Oct 2015 consisted of: ( a request for an updated list has been refused)
The current Board of the Vail Valley Medical Center:
Let's have a Community wide discussion about what's going on there