Hospital to sell Home Health and Hospice
The Claiborne County Hospital Board has decided to sell its Home Health and Hospice agency.
After receiving several letters of interest in answer to their request for proposals, the board decided to move forward in its effort to sell Claiborne Home Health. The board met to discuss a possible sale on Tuesday, Feb. 1, after being recessed during its regular monthly meeting in January.
There was a full room of interested parties, including employees and county commissioners in addition to all of the board members. The hospital and nursing home's financial situation has been grim for the past few months and several avenues for relief have been explored, including an emergency loan for $500,000. Home Health has continuously come under fire for having lower revenue than needed, although administrator Tim Brown pointed out that the nursing home is the only entity that operates consistently in the positive.
"We've seen declining revenues everywhere," Brown said.
After negotiations with the companies who submitted letters of intent, attorney Steve McSween, representing Restoration Healthcare, the hospital's management company, told the board that SunCrest was the best choice. Before the board heard from a SunCrest representative, McSween went over some particulars of the proposal and heard comments from the audience.
"How do they take care of indigent care," asked Danny Stone, who was in the audience.
The choice of home health agencies is ultimately up to the patient, but as part of the sale McSween said that SunCrest has agreed to take every patient discharged from the hospital, regardless of their ability to pay.
Another audience member, Chester Gibson, asked where the proceeds from the sale will go. "Is this just a quick fix for the hospital? What about 6-12 months from now, then what's going to happen?"
Steve Clapp, president and CEO of Restoration Healthcare, went over a list he had compiled for the board of how the proceeds from the sale would be used.
One of the top priorities is to recruit new physicians to the area, Clapp said. The area has lost several over the past few years.
Someone in the audience said that the physicians need to refer patients to
County Mayor Jack Daniels stated that he has talked to two companies who "want to lease the whole thing" and expressed his misgivings about selling the home health agency.
After some audience discussion, Wally Dant, President and CEO of SunCrest, came into the meeting to talk about his organization. Headquartered in
Dant assured the board and audience that his company would take care of patients much like Claiborne Home Health currently takes care of them.
"We want to be a good partner with our referral sources," he said. "We take all different payors and we're probably the biggest TennCare provider in
He added that his company takes all payors "because it's the right thing to do."
Board member Rob Asbury asked Dant if he sees any problem taking indigent care patients and Dant replied that they take both the good and bad as partners in the community.
Part of his philosophy, he said, is to focus on the company's employees and give them the tools they need to work with. Also, he said he wants to give back to the community.
Daniels appeared skeptical, asking Dant how his company planned to make the home health agency profitable when it wasn't profitable under the helm of the hospital and its management.
"There's a difference between a hospital running it and us running it," Dant replied. "They focus on filling beds in the hospital... Our sole business is home health and hospice."
"We understand what it takes to run a home health organization," Dant said.
Audience member Roger Ball asked about the company's financial situation and if anyone from the hospital had examined SunCrest's financials. Clapp assured him that background checks had been done, and Dant replied that his company is "very financially sound."
As part of the arrangement SunCrest agreed to hire all of the current employees if they meet regulatory requirements. Dant said that SunCrest will honor all of the paid time off days the employees have accrued, as well as transferring their years of service. They will also match retirement contributions at four percent.
"If we decide to vote to sell [home health], it is not the fix for this hospital," said Daniels.
After more discussion, board member Terry England made a motion to go forward with negotiations with SunCrest to sell Claiborne Home Health and Hospice. Asbury voiced a second to the motion.
The next step is for each side to perform due diligence and to negotiate the final agreement and then close the deal. The closing is estimated at the closest date for the end of February, and at the end of March for the farthest date.
The next meeting of the hospital board will be its regular monthly meeting on Tues., Feb. 22 at 6 p.m. in the hospital's conference room.
