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KCC rejects KH EMS funding request

Posted: April 11, 2013 7:19 p.m.
Updated: April 12, 2013 5:00 a.m.
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Kershaw County Council Chairman Gene Wise

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Kershaw County Council voted, 4-3, to reject a request Tuesday to take over an average $846,000 annual emergency medical services (EMS) deficit from KershawHealth. During a presentation to council at Tuesday’s meeting, KershawHealth President and CEO Donnie Weeks and Vice President and COO/CFO Mike Bunch said the healthcare organization has experienced a five-year loss of $4.22 million from EMS operations alone.

Following Weeks and Bunch’s presentation, Councilman Jimmy Jones questioned their motives for appearing before council. Chairman Gene Wise expressed concern that KershawHealth might come before council for assistance each year.

Weeks and Bunch presented much the same information they had at a recent KershawHealth Board of Trustees meeting, asking the county to not only take over the EMS deficit, but future capital expenditures. Weeks said the request was a “purely financial” one, praising the county’s EMS operation as one of the best with which he’s been involved. He also thanked council for its recent approval of a lease agreement for two new ambulances, but noted that KershawHealth would need six more during the next three years.

“(The) analysis and the resulting recommendation has no bearing on or connection to the dedicated employees in our EMS service or the important services they provide every day, on every call and for every patient. KershawHealth has loyally supported them and the EMS service for decades with very little or no financial support,” Bunch said.

Weeks noted that KershawHealth’s carriage of the EMS deficit is rare.

“We’re one of the only counties in the state where the county does not support the EMS deficit,” he said.

The only other county where the EMS deficit is funded by the hospital is Oconee County, Weeks said. However, he said Oconee County’s EMS operation is very centralized and without as many stations as Kershaw County. As he had during the KershawHealth board’s March meeting, Bunch noted that KershawHealth’s EMS deficit loss translates to $14 per person in Kershaw County with a population of 61,697. That is the same average per person loss across those EMS operations Bunch was able to examine.

“We need to preserve going forward. It is in jeopardy. The mission is in jeopardy,” Weeks added.

Councilman Tom Gardner said he understood there is no charge for “false alarms” by EMS -- times when EMS is on the way to or even arrives at a location but the call is cancelled. Gardner suggested KershawHealth charging a fee when this happens.

“I talked to an EMS employee the other day and he said he had six false alarms the day before … if you were to charge … this could add up to about $100,00 a year,” said Gardner. “One aspect you need to look at. It costs you money to do this.”

Weeks said he appreciated the suggestion and would look into the idea.

After County Attorney Ken DuBose confirmed that the land the hospital is build on is owned by the county, Wise said it is council’s “duty to protect” taxpayers in regard to the hospital’s current financial situation and for what purposes money is being spent.

Weeks said that there are two main aspects to the situation: the balance sheet and the income statement.

“The balance sheet is strong but the income statement was weak last year, it’s going to be weak this year due primarily to the cuts we will receive,” said Weeks.“If income statements continue to be weak, cash will decrease. It’s the same as if you or a family member lost a job. The employees are the lifeblood as well as the physicians and we want to preserve this and the mission.”

In a brief interview Thursday, Weeks explained that the balance sheet represents the value of KershawHealth’s assets, including the effects of any liabilities, showing the organization’s net worth. KershawHealth’s income statements, he said, represents the difference in income and expenses, showing either profits or losses.

KershawHealth’s balance sheet is strong and administrators are “nowhere near having to close” the hospital, Weeks said Thursday. He said he and Bunch only approached council because they need to begin preparing for cuts in government reimbursements and because the EMS deficit is the largest KershawHealth is carrying.

Wise asked what was happening in other communities across the region. He spoke about a county hospital in Monroe, N.C., where Union County decided to lease the facility out following a financial crisis. The county received $6 million for leasing the facility which is now part of Carolinas HealthCare System (CHCS), the largest healthcare system in the Carolinas and third largest public non-profit system in the nation.

In August 2011, The Charlotte Observer reported that the terms of the lease included CHCS making a $54 million up-front payment and $6 million annually for 50 years.

“Will you be coming back here every year asking for money or do you have a plan?” Wise asked Weeks. “Do you have a strategic plan for the next five years if you don’t receive this funding?”

“We’re here tonight because we have strategic plans to preserve this mission and its jobs,” Weeks answered. “We will do everything to keep this locally supported.”

“I’d much rather look at other agencies than close down the hospital,” Wise said.

“We will have a hospital in Kershaw County we just want it to be locally controlled,” Weeks said in response.

Councilman Sammie Tucker Jr. asked if “instead of chewing the whole elephant, is there any way we could just take a few bites?” in terms of making a plan for “one or two or three years.”

Gardner asked how the KershawHealth Foundation fits into the situation. Weeks said Foundation fundraisers typically go toward construction and expansion projects rather than operational issues.

Councilman Jimmy Jones then began questioning Weeks and Bunch.

“Why are you really here?” said Jones.

“We just gave a presentation that explained that,” Weeks responded.

“I’ll ask again, why are you really here?” Jones repeated, going on to say that he disagrees with a 5-mill tax increase to taxpayers to fund the deficit. “Are you asking for us to take over the ambulance service or to fund it?”

“The motion is in front of you,” Weeks said. “I’ve said why we’re here; there’s no other reason.”

Jones went on to commend Wise for a previous recommendation for council to vet every new candidate for the hospital board.

“Chairman Wise has requested greater transparency and accountability on this. We’ve needed this process for a long time. Perhaps with greater accountability, we could have prevented some of the miscarriages of hospital management,” Jones said. “It’s my understanding the previous hospital board gave Mr. Weeks authority to negotiate contracts without their approval. What successful organization allows contract negotiations without oversight? This is how we have over half a million dollars being spent for a pediatric (practice) whose representative was on the board at the time of the contract’s approval.

“You can like what I say, or you don’t. I don’t care. It’s the truth. Why are ER doctors leaving our hospital? Is it because Donnie Weeks and his management staff are making more than the doctors themselves?”

Jones said that he’s talked to nurses and employees of the hospital who have had to cut their hours back by 10 per week and other employees who are losing benefits.

“Is there any justification for Mr. Weeks’ providing his chief operating officer a $200,000 retention bonus over a three-year period? All of this, during a time when nurses and staff have had their hours cut back and benefits reduced,” said Jones.

He then went on to recommend a full investigation be launched into KershawHealth’s spending before “we dish out more money.”

“This request is absolutely … I just don’t understand it,” said Jones. “I love our hospital and its employees. Let me assure you, Kershaw County will not be without ambulance service. We may be without management at the hospital, but we won’t be without ambulance service.”

Jones then made the motion to reject the funding request saying “this is the right thing to do.”

Jones, Wise and councilmen C.R. Miles Jr. and Willie Mickle voted in favor of rejecting the request while Gardner, Tucker and Councilman Stephen Smoak voted against the rejection.

Smoak, however, clarified his vote, saying he thought council should gather more information before voting to reject or accept the funding requests.

“It certainly doesn’t mean I was willing to fund the deficit,” Smoak said.

Weeks said the following about the vote in a statement released Wednesday afternoon:

“Certainly, we are disappointed that Kershaw County Council voted not to consider funding the annual deficits and capital investments for EMS, even though such funding is typical in the majority of counties across South Carolina. Benchmarking our EMS with others across the state clearly shows that KershawHealth operates this service very efficiently. Moreover, our response time, which is in the 90th percentile, is one clear indication of the high quality of this essential service. Our immediate challenge will be how to maintain EMS, and we want to assure the citizens of Kershaw County that this service will continue.

“The nearly $1 million loss KershawHealth incurs from EMS annually has a profound impact on our overall financial viability. The larger challenge ahead now for KershawHealth leadership is how to preserve our hospital and other healthcare services we provide in the face of extraordinary changes in the way America delivers and pays for healthcare. Over the next five years, we face $32 million in current and anticipated cuts to Medicare and Medicaid reimbursement. These mandated cuts affect hospitals across the country. While we will continue to find ways to operate more efficiently within the current healthcare delivery model, we must also prepare for the fundamentally different healthcare delivery model that is emerging. Bold action will be required to reengineer KershawHealth to continue fulfilling its century-old mission.”

In other business Tuesday, council discussed an agreement between the county and the Central Midland Council of Governments (COG) regarding its Columbia Area Transportation Study Metropolitan Planning Organization (COATS MPO). The agreement would move a portion of Kershaw County transportation planning from the Santee-Lynches COG to the Central Midlands’ COATS MPO. The move is an automatic one due to increased population in certain portions of the county.

“So basically someone in Washington decided we were an urbanized area?” Smoak asked.

Kershaw County currently has seven seats on Santee Lynch’s board but would have only one seat out of 50 on the COATS MPO board. Tucker expressed concern about the situation and who would be representing Kershaw County.

Also Tuesday, council:

• proclaimed April 14-20 as National Public Safety Telecommunications Week;

• proclaimed April 21-27 as KershawHealth Centennial Celebration Week;

• proclaimed May 15 as Peace Officers’ Memorial Day;

• voted unanimously on first reading to amend zoning for two parcels of land on Smyrna Road so a subdivision can be created;

• voted unanimously to amend the county’s zoning and land development regulations to allow businesses to attach flags with their names or logos to the face of their buildings without a permit;

• discussed Historic Camden Revolutionary War Site’s request for assistance in becoming a welcome center but deferred a vote to its next meeting; and

• learned that two members of council’s Tourism Advisory Committee cannot be voting members due to holding dual roles in county and city of Camden positions.

There are also two vacancies on the Kershaw County Grievance Committee which will be filled by Shane Duncan of the recreation department and Wesley Adamson from the solid waste department. The Accommodations Tax Advisory Committee has vacancies as well which were also filled at the meeting while council reappointed Richard Galloway, Virginia Isler and Donald Buchanan.


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