Kosciusko Community Hospital is officially a for-profit hospital with the completion of the sale to Quorum Health Group Inc.

In a statement released Monday by KCH, the net proceeds from the sale will total at least $63 million. Those funds will be placed in the control of a newly created Kosciusko 21st Century Foundation (K21 Foundation).

According to a statement, the foundation was formed to "promote, improve and enhance the quality of life for the residents of Kosciusko County." The funds generated through the investment of the sale proceeds will be used for grants to support new and existing community programs that address those quality-of-life issues.

Under the terms of the sale, Quorum will allow the KCH board of directors to maintain a majority of local citizens and the board will be responsible for the quality of care given by the hospital.

The new KCH board of directors will consist of John Davis, John Kibiger, Lowell Owens, Robert Piecuch, Michael Kissane, Judy Mugg and an additional appointee whose acceptance is pending. The KCH staff appointees to the board include doctors Thomas Howard, Douglas Sawyer and Neal Van Ness. Dr. Al Martindale, staff president, is an ex-officio member.

Wayne Hendrix, KCH president, also addressed the question of oversight of the purchase agreement with Quorum. The KCH board will have the responsibility to monitor the new owners' compliance with the terms of the purchase agreement.

"There is a provision in the agreement that provides for the possibility within the first 10 years that if the board determines Quorum is not living up to the terms, they can buy back the hospital from Quorum," he said.

Hendrix added that the provision can only be enforced by the KCH board and Quorum cannot force a buy-back through the agreement.

The new K21 Foundation board includes chairman Patricia Oppenheim, Willis Alt, David Anuta, Carl Ellis, Avis Gunter, John Hall, Ray Monteith, Bart Culver, Dr. Erin Jungbauer, Sandy Rader and Dr. Roland Snider.

With the sale, changes are already occurring at KCH, according to Hendrix. Immediate changes involve indigent care and some obstetric services.

"The indigent prescription program is being taken care of by the K21 Foundation, and the OB in-home care (pre- and post-natal) is being picked up by the foundation and the county board of health," he said. "In terms of indigent care, Quorum will accept any patient a doctor admits, regardless of their ability to pay. Quorum will write off the costs."

According to Alt of the K21 Foundation, the clerical requirements for implementing the prescription program will be picked up by the foundation. The prescription drugs will be donated by pharmaceutical companies.

"The foundation will be picking up the costs of the prescription drug program. The drug companies will provide the drugs and the foundation will pay for the clerical help to handle the paperwork," Alt said.

He said the foundation will meet soon to establish committees that will determine both the grant application and awarding criteria, and a committee to control the investing of the sale proceeds. Alt said all local financial institutions will be contacted to make proposals for handling the foundation's investment account.

"We've invested the proceeds in 30-day government securities for now," Alt said. "Lake City Bank, National City Bank, Key Bank and 1st Source Bank, as well as local brokers, will be given an opportunity to submit proposals once the investment committee is established."

He said the foundation is currently negotiating for office space on West Center Street, adjacent to the current Kosciusko County Foundation offices. [[In-content Ad]]