The University of Mississippi Medical Center, as expected, has submitted a proposal to take over the operation of Greenwood Leflore Hospital before the end of the year.
Meanwhile, the financially troubled hospital is laying off an estimated 40 more employees and cutting additional services in an effort to keep from running out of money before the potential long-term lease with UMMC can be finalized.
Gary Marchand, the interim CEO of Greenwood Leflore Hospital, said it has only two choices in the short term: either further scale back its operation or close its doors.
Click on Title To Read Document
“We’re headed to be completely out of business or in business on some other limited basis until we can do a lease with University.”
In a memo distributed Thursday to hospital employees and medical staff, Marchand said the latest cutbacks were necessitated by a three-day shutdown last month caused by a sewage leak. He estimated that the disruption cost the hospital $1.2 million.
“The viability plan we previously had in place was interrupted by this unfortunate event,” Marchand said in the memo. “The estimated loss of revenue related to this event requires that we revise our previous plans. The objective continues to be to operate GLH services into or through the month of December.”
The memo said that the hospital’s intensive care unit as well as its labor and delivery unit would remain closed, apparently indefinitely, due to a shortage of skilled employees to staff them. The hospital administration, in a cost-cutting move, had earlier decided to stop using the more expensive contracted labor, most notably nurses, to fill in where the hospital is short of employees.
The memo said the hospital currently has only enough employed staff to fill 40% of the needed positions in its ICU and 15% in the labor and delivery unit, including the newborn nursery.
“The decision was we will not staff an inpatient service that we cannot provide safe, high-quality services for,” Marchand said.
The hospital also is closing three clinics — After Hours, Ryan White and Magnolia Medical. The After Hours Clinic has provided non-emergency care for patients who don’t have a primary care physician or who need treatment at night or on weekends. The Ryan White Clinic treats patients with AIDS or who are infected with HIV, the virus that causes AIDS. Magnolia Medical is a family practice clinic that specializes in HIV management.
Marchand said both Ryan White and Magnolia Medical are being shut down because of a low volume of patients. Services previously provided at the After Hours Clinic will be assumed by the emergency room, he said.
The estimated layoffs include 20 full-time and 20 part-time employees. This will be the second round of layoffs the hospital has implemented over the past four months. Thirty employees were laid off in May.
Marchand said he is optimistic that the administration will not have to order further staff reductions.
Prior to this week’s job reductions, the hospital reported that it had 749 employees, including 348 who work full time. Another 75 full-time workers are employed by Aramark, the private contractor that handles laundry, housekeeping, maintenance and food services at the hospital.
Unlike in the previous layoff, which included at least two physicians, no doctors will be laid off this time. Marchand said, however, that the Greenwood hospital has been working with UMMC to place at its Grenada location a limited number of physicians who have been impacted by the closure of Greenwood’s ICU and labor and delivery units.
UMMC has been interested in a partnership with Greenwood Leflore Hospital for at least four years. In 2018, UMMC proposed an affiliation but later withdrew the proposal after the hospital board at that time declined to act on the offer.
Talks with the state-owned hospital, though, were resumed last year after the administration and a largely reconstituted board for the Greenwood hospital determined that it could no longer survive as an independently operated facility.
With the unanimous concurrence of the Greenwood City Council and Leflore County Board of Supervisors, the hospital advertised last month for proposals on a lease of 20 to 50 years. UMMC was the only medical institution to submit an offer by Wednesday’s deadline.
The details of that offer were not immediately available.
This month the hospital board will be evaluating UMMC’s proposal and making a recommendation to the city and county boards, both of which would have to approve leasing the publicly owned hospital. The deal would also have to be approved by the state College Board, which governs UMMC. Marchand said he expects a lease to be finalized by early December.
UMMC declined Thursday through a spokesperson to comment on the potential takeover.
Marchand said he thought UMMC would be amenable to negotiating some of the terms of the long-term agreement. He acknowledged, however, that the Greenwood hospital has limited bargaining power since, in his assessment and that of other hospital officials, it’s either lease the hospital to UMMC or close.
“We don’t have much negotiating leverage,” he said.
Marchand took over as interim CEO of the Greenwood hospital for the second time in three years after Jason Studley, the hospital administrator whom Marchand helped recruit, suddenly resigned in July.
Harris Powers Jr., chairman of the board, credited both Marchand and Studley for steering the hospital through the turmoil created by the COVID-19 pandemic and the increasingly difficult landscape for rural health care.
“We’re lucky as hell that we had Jason and Gary here to keep the doors open until we could get a proposal,” Powers said.
The Greenwood hospital has been plagued for some time by declining patient numbers, a large volume of uncompensated care and what industry experts claim are inadequate reimbursements from government-funded insurance programs Medicare and Medicaid. The hospital has been losing millions of dollars annually for several years, and those losses have steadily depleted cash reserves. Since the end of July, it has essentially been living on borrowed money — Medicare advance payments socked away since 2020 that the hospital is having to pay back at the rate of about $1 million a month. Before this latest round of service and staffing cuts, it appeared that the hospital only had enough cash to operate through October.
Without those advance payments, which amounted to a loan of originally $16.5 million, the hospital would have been out of operation by now, according to Marchand.
“If we hadn’t done that, this thing shuts down four, five, six months ago,” he said.
Adding to the financial problems was a sewer-line clog in August that resulted in human waste and other raw sewage backing up into the hospital’s underground crawl spaces. That forced the hospital to stay largely empty for three days as it resolved the problem and any potential health hazards the leak created.
Afterward, it reopened all outpatient services but only a dozen inpatient beds as a way to hold down costs.
Marchand said the hospital will open more inpatient beds if enough nurses, who previously worked under contract at premium rates, are willing to accept a regular schedule and the compensation the hospital pays its employed nurses.
According to Marchand’s memo, the administration continues to discuss with its vendors lowering the price of supplies and services until a lease can be finalized. In July, the hospital asked Greenwood Utilities to provide it with free water and electricity, which combined run an estimated $120,000 to $130,000 a month. The utilities board has yet to act on that request.
- Contact Tim Kalich at 662-581-7243 or tkalich@gwcommonwealth.com.
