KCH Poised For New Era
July 28, 2016 at 4:25 p.m.
The new year will bring the most dramatic changes to Kosciusko Community Hospital since it opened its doors in 1976.
The hospital will join the private, for-profit health organization Quorum Health Group Inc., which owns 20 hospitals and manages 240 more throughout the United States.
According to Wayne Hendrix, hospital president, the decision to join the Quorum network was made after careful research, public input and deep soul-searching by the hospital's board of directors.
"We talked with over 500 county residents in gauging the public's support (for the move)," said Wayne Hendrix. "We had focus groups, meetings with industry leaders, former donors, open meetings with the public and community service groups. We also had consultants survey other county residents. The results convinced us this was the right move."
The KCH board signed a letter of intent with Quorum in November and the purchase agreement should be finalized by Jan. 31, Hendrix added.
The final selling price has not bee determined to date, Hendrix said. That figure will be arrived at through complex negotiations over accounts receivables and payables that are currently on-going. In addition, the KCH board signed a letter of confidentiality which prohibits the board from disclosing any figures, Hendrix added.
"The key point that should be made is that all the proceeds from the sale are going to the KCH Foundation," Hendrix said. "In addition, the foundation is also being given monitoring powers over the hospital's operation to make sure Quorum abides by the agreement."
He added the agreement provides varying levels of sanctions should Quorum breach the agreement, up to and including a repurchase of the hospital.
"The foundation will also maintain management control of home health care services and Mason's long-term care facility. The Wellness Center and Med-Stat will be included in the sale. he added.
Board member John Davis said the community meetings showed county residents and businesses would support the buyout if the cost and quality of the health care available would be maintained or improved.
"Most of the concerns we heard were that dependable, affordable health care would still be available in the community," he said. "We used those concerns in crafting this agreement."
Board president Willis Alt said the board itself is made up of a broad cross-section of the community and they, too, had the best long-term interest of the county in mind in making their decision.
Community concern over quality health care is not uncommon when a new, larger health care organization takes over a local hospital.
From a business standpoint, the change in the health industry also made the sale of KCH, an independent, not-for-profit facility, necessary for it to remain financially viable, Hendrix said.
"We had just completed a revision of our strategic plan, and it became clear that we weren't sized properly to be able to compete in the long-term," he said. "We were beginning to experience cutbacks in government payments - 17 percent reductions in Medicare payments alone, and $500,000 in other federal health care payments.
"We were also being confronted with many changes in competition, with more services being provided outside of the hospital," Hendrix added. "By joining a larger health organization, we have a larger capital pool from which to draw."
Both Davis and Alt concurred with that assessment.
"It was apparent that a small, stand-alone hospital couldn't continue to compete due to economies of scale," Davis said. "We felt that when 64 of the 117 hospitals in the state have already gone in this direction, we saw that this was the wave of the future."
Alt said the purchase would put KCH in a position to compete and grow well into the 21st century.
"By affiliating with a larger organization, we were also able to position ourselves to make it more difficult for 'out-of-hospital' competition to come in," he said.
In addition to greater financial health for the hospital, the community's health will also be improved with Quorum's purchase, the trio contend. Some of the new services expected to be created with the sale of the hospital include a comprehensive women's health center and a new cancer treatment facility providing specialized cancer treatment, radiation therapy and chemotherapy.
"Not only will the residents of the county continue to have the same quality health care they have today, but the services we're able to provide will be expanded," Hendrix said. "This will be a major benefit to our community because local residents will no longer have to travel for cancer care."
He added the decision to join the Quorum health network was one based on quality of care and the financial viability of the hospital into the next century. No board member received any type of bonus or finder's fee in exchange for the decision to join Quorum.
"No one will receive any type of monetary consideration - no finder's fee, no bonus - in any of these negotiations," he said. "This is an unpaid, volunteer board who work very hard for the hospital."
Quorum has expanded medical services for the hospitals it's acquired since it acquired its first hospital in 1990. It currently own four hospitals of comparable size to KCH, which has 74 beds.
According to David Boucher, chief executive officer of Carolina Hospital System in Lake City and Kingstree, S.C., community fears are understandable. Boucher is the head of two hospitals taken over by Quorum in 1995 and 1996. Both hospitals are similar in size to KCH, with the Lake City facility having 48 beds and Kingstree having 78.
"I can understand where people's fears may be that the quality of their health care will be diminished. But Quorum has access to capital that private nonprofits don't have," he said. "It's been my experience that Quorum has expanded the services available to patients in both Kingstree and Lake City."
In terms of jobs, Boucher said, Quorum tried to keep all the employees of the two hospitals - as Quorum has promised to do here. However, both facilities did experience some staff reductions initially, but all those positions have been replaced and the workforce is now higher than when Quorum took over.
"In the situations I've been involved in, there has been some reductions in staff, but every situation is different," he said. "In Lake City, we've added 25 more full-time positions this year through growth. Today, we have more employees than before Quorum entered the picture." [[In-content Ad]]
The new year will bring the most dramatic changes to Kosciusko Community Hospital since it opened its doors in 1976.
The hospital will join the private, for-profit health organization Quorum Health Group Inc., which owns 20 hospitals and manages 240 more throughout the United States.
According to Wayne Hendrix, hospital president, the decision to join the Quorum network was made after careful research, public input and deep soul-searching by the hospital's board of directors.
"We talked with over 500 county residents in gauging the public's support (for the move)," said Wayne Hendrix. "We had focus groups, meetings with industry leaders, former donors, open meetings with the public and community service groups. We also had consultants survey other county residents. The results convinced us this was the right move."
The KCH board signed a letter of intent with Quorum in November and the purchase agreement should be finalized by Jan. 31, Hendrix added.
The final selling price has not bee determined to date, Hendrix said. That figure will be arrived at through complex negotiations over accounts receivables and payables that are currently on-going. In addition, the KCH board signed a letter of confidentiality which prohibits the board from disclosing any figures, Hendrix added.
"The key point that should be made is that all the proceeds from the sale are going to the KCH Foundation," Hendrix said. "In addition, the foundation is also being given monitoring powers over the hospital's operation to make sure Quorum abides by the agreement."
He added the agreement provides varying levels of sanctions should Quorum breach the agreement, up to and including a repurchase of the hospital.
"The foundation will also maintain management control of home health care services and Mason's long-term care facility. The Wellness Center and Med-Stat will be included in the sale. he added.
Board member John Davis said the community meetings showed county residents and businesses would support the buyout if the cost and quality of the health care available would be maintained or improved.
"Most of the concerns we heard were that dependable, affordable health care would still be available in the community," he said. "We used those concerns in crafting this agreement."
Board president Willis Alt said the board itself is made up of a broad cross-section of the community and they, too, had the best long-term interest of the county in mind in making their decision.
Community concern over quality health care is not uncommon when a new, larger health care organization takes over a local hospital.
From a business standpoint, the change in the health industry also made the sale of KCH, an independent, not-for-profit facility, necessary for it to remain financially viable, Hendrix said.
"We had just completed a revision of our strategic plan, and it became clear that we weren't sized properly to be able to compete in the long-term," he said. "We were beginning to experience cutbacks in government payments - 17 percent reductions in Medicare payments alone, and $500,000 in other federal health care payments.
"We were also being confronted with many changes in competition, with more services being provided outside of the hospital," Hendrix added. "By joining a larger health organization, we have a larger capital pool from which to draw."
Both Davis and Alt concurred with that assessment.
"It was apparent that a small, stand-alone hospital couldn't continue to compete due to economies of scale," Davis said. "We felt that when 64 of the 117 hospitals in the state have already gone in this direction, we saw that this was the wave of the future."
Alt said the purchase would put KCH in a position to compete and grow well into the 21st century.
"By affiliating with a larger organization, we were also able to position ourselves to make it more difficult for 'out-of-hospital' competition to come in," he said.
In addition to greater financial health for the hospital, the community's health will also be improved with Quorum's purchase, the trio contend. Some of the new services expected to be created with the sale of the hospital include a comprehensive women's health center and a new cancer treatment facility providing specialized cancer treatment, radiation therapy and chemotherapy.
"Not only will the residents of the county continue to have the same quality health care they have today, but the services we're able to provide will be expanded," Hendrix said. "This will be a major benefit to our community because local residents will no longer have to travel for cancer care."
He added the decision to join the Quorum health network was one based on quality of care and the financial viability of the hospital into the next century. No board member received any type of bonus or finder's fee in exchange for the decision to join Quorum.
"No one will receive any type of monetary consideration - no finder's fee, no bonus - in any of these negotiations," he said. "This is an unpaid, volunteer board who work very hard for the hospital."
Quorum has expanded medical services for the hospitals it's acquired since it acquired its first hospital in 1990. It currently own four hospitals of comparable size to KCH, which has 74 beds.
According to David Boucher, chief executive officer of Carolina Hospital System in Lake City and Kingstree, S.C., community fears are understandable. Boucher is the head of two hospitals taken over by Quorum in 1995 and 1996. Both hospitals are similar in size to KCH, with the Lake City facility having 48 beds and Kingstree having 78.
"I can understand where people's fears may be that the quality of their health care will be diminished. But Quorum has access to capital that private nonprofits don't have," he said. "It's been my experience that Quorum has expanded the services available to patients in both Kingstree and Lake City."
In terms of jobs, Boucher said, Quorum tried to keep all the employees of the two hospitals - as Quorum has promised to do here. However, both facilities did experience some staff reductions initially, but all those positions have been replaced and the workforce is now higher than when Quorum took over.
"In the situations I've been involved in, there has been some reductions in staff, but every situation is different," he said. "In Lake City, we've added 25 more full-time positions this year through growth. Today, we have more employees than before Quorum entered the picture." [[In-content Ad]]