Unicoi hospital struggling to find direction

Brad Hicks • Jul 14, 2012 at 9:29 PM

ERWIN — Whether the nearly 60-year-old Unicoi County Memorial Hospital remains a community hospital or joins forces with a larger health care system, local officials agree action must be taken to maintain a hospital in the county.

Calling the hiring of a consultant to assess the hospital’s operations “a good move,” Unicoi County Mayor Greg Lynch said due to the hospital’s recent financial struggles coupled with the struggles smaller community hospitals are facing nationwide and the competition UCMH faces with larger area hospitals, he feels the hospital’s Board of Control needs to act quickly in making decisions that are in the county’s best interests.

“It’s my understanding that there’s some debt and there’s some problems in keeping services in the hospital, and to what extent those are I don’t know, but it just sounds like the hospital is in a position now where they need to start looking for a partner, and I hope the hospital board and the community will let the good of Unicoi County be the determining factor in what happens there,” Lynch said.

In April 2008, officials from Wellmont Health System expressed interest to the county’s leadership in partnering with UCMH. However, by August 2008 these talks had ended. An Aug. 7 letter from Wellmont addressed to the mayors of the county and towns of Erwin and Unicoi indicated insufficient support within the county to continue discussions.

“In the four months since our initial conversation, there has been no measurable progress or communication from the Unicoi County hospital. Additionally, press statements made by the hospital’s leadership indicate lukewarm interest in partnering with our health system,” Wellmont’s letter stated.

Wellmont’s letter stated its own research found “some resistance” among Unicoi County residents regarding the possible relocation of the hospital to the north end of the county.

“That was where I think probably the big sticking point was,” Lynch said. “They wanted to move the hospital to Unicoi. Basically, they wanted to be competitive. They wanted to be able to put the hospital where the doctors would come from Johnson City and, of course, the patients.”

Lynch said said he now understands the area’s larger health care systems are once again exploring the opportunity to partner with UCMH. He said UCMH Board of Control members must take a hard look at whether the facility can continue to operate as a community hospital and act accordingly to keep a hospital in the county, even if that means a move is necessary.

“We just can’t afford to lose the hospital,” Lynch said. “We’ve got to do what we can to keep it, even if that means allowing another hospital to come in and get the Certificate of Need and work some kind of deal to continue some use of that building up there where the hospital is now.”

But before action on a hospital, it appears officials will await the results of an assessment by Spectrum Health Partners. On Monday, the UCMH board met in a called session in which it approved a consulting contract with Spectrum. The firm will conduct an overall review of the hospital’s operations that is slated for completion within the next two months.

The consulting firm’s hiring was a stipulation of a May agreement between the town of Erwin and UCMH, which saw the town loan the hospital $800,000. Erwin Town Recorder Randy Trivette discussed the loan and consulting contract at a Thursday work session of the Erwin Board of Mayor and Aldermen.

“We don’t know exactly which directions the consultants are going to advise the board to go, but they won’t know which way until they get in there and look,” Trivette said Thursday.

On Monday, the Board of Control hired Jete Edmission, a senior adviser with Spectrum, to serve as the hospital’s interim consultant chief executive officer for a 30-day period. Trivette said a conference call between hospital officials and the consultants will likely take place Friday to provide an initial update on the hospital’s direction.

Trivette also said options on the table for UCMH include a financial turnaround brought on by increasing revenues while decreasing expenditures, acquisition of UCMH by another hospital, or partnering with a larger health care entity. He also commended the Board of Mayor and Aldermen’s decision to loan the hospital funding, adding that community members have given positive feedback about the deal — one that Trivette said protects taxpayer funds.

The agreement included several stipulations, including the hiring of a consulting firm to assess UCMH operations and the town receiving the hospital’s deed of trust for the real property at the hospital. At the time of the agreement, Trivette referred to the hospital as an “asset,” and said the town’s assistance was vital.

“I don’t worry or lose one ounce of sleep at night over the $800,000 that we put in because it was a good investment,” Trivette said Thursday.

Still, local officials agree difficult decisions could be on the horizon for the hospital’s board.

“We know that there are several hospital organizations in our area that are interested in pursuing a relationship with our hospital and, if that time comes, it will be up to us to decide what we think is best to provide excellent health care for all the citizens of our county,” said Unicoi County Commission Chairwoman and Board of Control member Sue Jean Wilson.

Wilson said if Spectrum’s recommendations are geared more toward a short-term fix, then a partnership would be the next step. She said recent financial struggles facing the hospital were brought on by decreasing insurance reimbursements, a lack of patients and doctors having out-of-town facilities for some services. She also said recent technology upgrades, while purchased with the best of intentions, proved to be cost prohibitive.

Besides hiring Spectrum and Edmisson, the board has made other recent decisions regarding the hospital’s future. At Monday’s meeting, the board unanimously voted to accept the resignation of CEO Jim Pate. Pate had been on administrative leave since June 22 following a decision by the board’s Executive Committee.

Board members previously cited health reasons as the reason for Pate’s leave. At Monday’s meeting, UCMH Board of Control Secretary/Treasurer Russell Brackins said other reasons existed that led to Pate’s resignation.

Wilson said Thursday that several months ago Toni Buchanan, UCMH’s chief financial officer who had been filling in as interim CEO in Pate’s absence, presented a plan the she had devised to alleviate the hospital’s financial strains and the board voted to put that plan into action.

However, Wilson said in a recent board meeting, Buchanan told board members Pate had failed to put the plan into action and outlined cuts were not being followed.

“I can’t speak to his reasons behind it, but (Pate) did not follow the wishes of the board, and I admire Ms. Buchanan for saying so,” Wilson said.

At Monday’s meeting, Trivette referred to a plan that would was presented to save UCMH around $80,000 per month but had not been put into effect. He said when the hospital approached the town seeking assistance, it was $1.2 million in the red, but said that number had since increased to $1.4 million.

Brackins declined to comment on Pate’s resignation, but he said he is optimistic about Spectrum’s assessment. While Brackins confirmed larger health care entities have been in recent discussions with UCMH officials regarding some type of affiliation, he said the first thing officials want to hear from the consultants is whether UCMH can remain viable as a community hospital. In the meantime, he said hospital officials would continue to reach out to interested health care institutions regarding partnership opportunities if this is the recommended direction.

Like his brother, town of Unicoi Mayor Johnny Lynch said he would like to see quick action from the board regarding UCMH’s future. He called the continuing need for a hospital in Unicoi County a “no brainer.”

“The way I see it is if they don’t go ahead and react in a fairly quick manner, all they’re doing is prolonging the agony,” he said. “I think they need to get something figured out as quickly as possible.”

County Mayor Lynch said regardless of the direction taken, a hospital is needed in Unicoi County, not only for emergency and medical services, but also for the economic impact provided.

“The bottom line is I want use to have a hospital, and I don’t want us to have an emergency room with a helicopter pad out back, although that’s better than nothing at all,” Lynch said. “That should be the end run ... to make sure that Unicoi County has as good a hospital as we can get.”

Board of Control Chairman Todd Love declined comment.

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