published Friday, April 1st, 2011

Hutcheson hears counter-proposal


by Emily Bregel

ABOUT HMA

Naples, Fla.-based Health Management Associates is a for-profit company that operates “nonurban acute care hospitals” mainly in the Southeast and Southwest, according to its website. The publicly traded company operates 59 hospitals in 15 states.

Five months into partnership negotiations between Hutcheson Medical Center and Erlanger Health System, trustees of the authority that owns Hutcheson plan to hear a proposal from a for-profit hospital management company tonight.

A “short presentation” from Health Management Associates, a Naples, Fla.-based publicly traded company, is listed on a preliminary agenda for a called meeting of the Hospital Authority of Walker, Dade and Catoosa Counties.

The agenda was distributed to hospital trustees Wednesday.

Many staff members hearing rumors of the HMA option are dismayed at the idea of new negotiations when a final agreement with Erlanger seems within reach, said Dr. John Nelson, a Hutcheson radiologist.

“Everyone has put a lot of time and effort to develop the management agreement and partnership” with Erlanger, Nelson said. “We don’t have time to do this. The hospital is like a patient in critical care. They’re in the ICU and they’re dying. They’re bleeding to death.”

Hutcheson is losing about $1 million a month and officials with Hutcheson Medical Center Inc. have warned the hospital could go bankrupt rescue doesn’t come soon. The hospital has defaulted on a $35 million bond issue from Regions Bank and its president and CEO, Charles Stewart, and interim chief financial officer resigned in February.

CONFUSION OVER MEETING

On Thursday two notices canceling the Friday meeting went out — one to hospital trustees and, later, one to media outlets — despite some trustees’ insistence that the meeting was still on.

As of Thursday evening the meeting was still on schedule, according to an email to the Times Free Press from Don Oliver, legal adviser for the board and Walker County attorney. He copied Hospital Authority trustees on the email.

“We have a meeting properly scheduled under the terms of our by-laws, we have a quorum of members both requesting the meeting and confirmed to attend, and UNDER NO CIRCUMSTANCES WILL THE MEETING BE CANCELED,” Oliver’s e-mail stated.

“Anyone who continues to interfere with our business will subject themselves to appropriate actions at law and/or under appropriate bar regulations,” he wrote.

Earlier Thursday, Hutcheson Medical Center executive assistant Pam Lawson sent trustees an email to saying that board chairman Dr. Darrell Weldon was canceling the meeting.

Weldon could not be reached for comment Thursday.

Trustee Daniel Jewell responded with an email saying a quorum of trustees would attend the meeting and would hear a number of guest presenters.

“This is an attempt by a party or parties to negate the responsibility of the Hospital Authority Trustees to exercise their fiduciary duties to protect the hospital from ill-advised ventures,” he wrote in the email, addressed to hospital authority trustees.

Jewell declined to comment to the Times Free Press.

NEGOTIATIONS WITH ERLANGER

Erlanger has offered a partnership to help struggling Hutcheson keep its doors open and rebuilt its physician and patient base.

The Hutcheson Medical Center Inc. board — which oversees the hospital’s operations — and leaders of Dade and Catoosa counties, have supported a deal in which Erlanger would put up $20 million and bring in the doctors and patient referrals that could start generating revenue that could repay Erlanger. The counties would have to secure the loan.

“It is the best deal for the hospital,” said HMC board treasurer Charles Berry. “We’ve got to get the deal done.”

But Walker County Commissioner Bebe Heiskell and some trustees of the Hospital Authority have suggested changes that Heiskell said would protect taxpayers’ money and assets. Erlanger officials were reviewing the suggestions last week.

In an emailed statement, Thursday, Erlanger President and CEO Jim Brexler said, “For the sake of the medical professionals, the employees of Hutcheson Medical Center, and the patients they serve, we are hopeful the North Georgia communities can quickly reach consensus on a future direction for their hospital.”

Berry supports the Erlanger partnership, saying that the hospitals share a mission to serve all patients regardless of ability to pay.

“I want somebody to tell me, if the (hospital) authority wants to go with a for-profit hospital, who will take care of the indigent care?” Berry said.

Word of the potential new suitor for Hutcheson is “dismaying,” Dr. Lori Emerson, pathologist and medical director of Hutcheson’s laboratory, said Thursday.

“When I’m at the hospital the stress level of the employees is just horrifying,” she said.

She said Erlanger leaders have met repeatedly with hospital staff.

“I think they have excellent ideas for us to go forward,” she said.

“I just want to know what’s going on with Walker County. It seems like there’s some sort of hidden agenda. ... They’re putting the citizens at huge risk of losing their health care.”

about Emily Bregel...

Health care reporter Emily Bregel has worked at the Chattanooga Times Free Press since July 2006. She previously covered banking and wrote for the Life section. Emily, a native of Baltimore, Md., earned a bachelor’s degree in American Studies from Columbia University. She received a first-place award for feature writing from the East Tennessee Society of Professional Journalists’ Golden Press Card Contest for a 2009 article about a boy with a congenital heart defect. She ...

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