HERMANN – Another positive financial audit is expected in the coming weeks for Hermann Area District Hospital and that means avoiding being tagged as “a going concern” — a label that could hinder the hospital’s partnerships with outside organizations.

That key point was provided last week by accountant Eric Laplata of the accounting firm Forvis Mazurs, which is putting the finishing touches on the hospital’s financial review for 2025. Last year’s audit was the first one in many years that the hospital was not labeled as being “a going concern.”

What that phrase means essentially is that there is a concern that a business or organization — in this case, the community owned hospital — will be able to remain in operation a year after “a going concern” designation is issued.

“We are in draft form in the audit,” Laplata told the hospital’s Board of Directors Thursday afternoon at its regular monthly session. “We are prepared to issue a clean opinion,” he added, noting that “we don’t have any material weaknesses to report to the board. We did not note any material weaknesses” in the review.

HADH Chief Executive Officer and Administrator Bill Hellebusch said the absence of “a going concern” finding is key to maintaining relationships with organizations with which the hospital does business.

But can the lack of “a going concern” label prove costly for the hospital?

That concern was raised by Dr. Michael Rothermich, chief of the HADH medical staff, who pointed to a large fund of money designed to aid rural hospital. One of the key components for hospitals hoping to tap into that fund is that the hospital needs to be in financial distress. He held out the prospect that having that label in place might improve the hospital’s chances of receiving a portion of that money.

Rothermich floated the idea that the accounting firm “call it a going concern until you’re ready to lift the label,” which might help the hospital win approval to receive a portion of the money available to rural hospital.

Laplata was reluctant to subscribe to that notion, pointing out that while some financial concerns remain — “You can see the (operating) margins are tight,” he said — major strides have been made to move the hospital to a more-solid financial footing.

Indeed, Hellebusch and his administrative team need to continue to whittle away at the hospital’s long-term debt, which is put at about $8 million. As hospital officials have noted before, that will happen with activity on two fronts: One is increasing revenue by increasing patient volume and the other is by cutting expenses, such as the large cost of contract workers needed to fill positions that Hellebusch hopes can filled with local hires.

The hospital continues to rely on the more-expensive contract nurses, including an Emergency Room night-sift nurse, and a night-shift floor nurse that decided against taking the job after being hired. As of the board session, there were four contract workers.

According to Human Resources Director Matt Siebert, there are 14 vacant positions at the hospital.