Tuesday, August 29, 2017

Rural Virginia hospital, closed since 2013, sold to a start-up firm with little experience

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The governing board of shuttered Lee County Hospital in Pennington Gap, Virginia, has voted to sell it to a Florida-based start-up, "rejecting an offer by a regional provider that planned to immediately provide urgent care," Luanne Rife reports for The Roanoke Times. Americore Health did not provide financial statements, show the source of its income, or offer a detailed business plan, but manages the hospital in nearby Pineville, Ky., and reports are mixed about how well it's doing there.

It's the latest chapter in a turbulent history for the Lee hospital, which closed almost four years ago. Wellmont Health System purchased it in 2007 as a package deal with Mountain View Regional Medical Center in Norton, Va., pitting itself against "Mountain States Health Alliance and its Norton Community Hospital," Rife reported at the time. Wellmont didn't really want Lee County, and some claim the hospital was poorly run on purpose in order to shore up Wellmont's bottom line so it would look more attractive to potential merger partners. Wellmont closed the hospital with little warning in October 2013, leaving 25,000 people without a nearby hospital. A state legislator pushed through a law to let local leaders create a governing board for the hospital and buy it from Wellmont. After an outcry from Pennington Gap citizens, Wellmont agreed to the $1.6 million sale, financed by a loan from the county government.

The governing board planned as recently as 2015 to hire Mountain States, Wellmont's rival, to provide services. But the board voted 5-3 on Aug. 24 to sell the hospital to Americore for $2 million, "with the expectation that Americore will pursue opening a critical-access care hospital along with implementing its business plan to run enhanced laboratory services and provide behavioral health care," Rife reports. The two dissenting board members said they wanted to pursue a proposal from Mountain States that would have "immediately provided urgent care, followed by a full service emergency department, and a feasibility study to determine whether a critical access hospital is financially sustainable."

UPDATE, Sept. 20: Tennessee regulators have approved a merger of Wellmont and Mountain States, but Virginia has yet to approve it and the Federal Trade Commission objects to the process, Rife reports.

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