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Habersham hospital deal loses momentum

Health officials still pursuing partnership

POSTED: August 4, 2014 1:00 a.m.

Despite some financial hurdles for Habersham Medical Center, the Demorest-based hospital and Northeast Georgia Health System are still working toward a partnership of some type, officials said last week.

Although a “letter of intent” between the two entities has expired, “we are still in discussions ... about a potential agreement between our two organizations and are hopeful that we can find a solution that is beneficial to the residents of our shared communities,” NGHS spokeswoman Melissa Tymchuk said.

Habersham Medical and NGHS have been working since at least early 2013 on an agreement to share resources and services.

Since then, Habersham Medical has hit a couple of rough financial patches.

Last fall, the Habersham Hospital Authority, which governs the Habersham hospital, voted to pay back $1.5 million as part of the federal Centers for Medicare and Medicaid Services’ Electronic Health Records Incentive Programs, which helps health providers pay for developing medical record technology.

And the hospital has struggled to make bond payments stemming from $37 million it borrowed several years ago to expand the emergency room, outpatient surgery and make other improvements.

“When the economy turned sour, we had a lot of unemployment up here and people without insurance, and it was hard (for the hospital) to make a go of it,” said David Kerby, hospital authority chairman.

To pick up the slack, the Habersham County Board of Commissioners, which had signed off on the bonds, “was having to make up some of the difference.”

In a recent agreement, the commission agreed to take over bond payments until “we reach a certain financial threshold, then after that we will make bond payments,” Kerby said.

“We would like for the hospital to be independent enough that it would have a positive cash flow,” he said.

“As a result of the restructuring of the debt, the sale or lease of (the hospital) is off the table,” Kerby said. “However, we still want to negotiate some kind of affiliation with Northeast Georgia Medical Center.”

As part of that, Habersham Medical could accommodate overflow patients from Northeast Georgia Medical Center, which is operated by NGHS, he cited as an example.

“We also have a new and very efficient outpatient surgery department that can use some of the specialists at (NGMC) that we don’t have ... and that would take some of the load off Northeast Georgia,” Kerby said.

NGHS has kept up with the hospital’s recent financial chapter.

“Throughout our discussions with the authority, we have also been in contact with the (Habersham) county commission, and will continue to do so going forward,” Tymchuk said.

She said the health system and Habersham hospital early on established a list of “mutual goals and objectives for a successful agreement,” including that the ultimate outcome should be good for area residents and that both organizations are open to considering a range of health care options and models.

Also among the criteria is that “any short-term solutions must be made in the context of a long-term plan. This is especially important given the changing health care landscape.”

For NGHS’ part, “we hope to come to an agreement as soon as possible,” Tymchuk said.

Kerby is not sure when that’ll come to pass but said he reckons that the health system might be busy trying to open its new 100-bed Braselton hospital, which is under construction off Ga. 347 in South Hall. The hospital is set to open in spring 2015.

“I know they have a lot on their plate ... so, (a partnership) may not be way up on their to-do list,” he said.



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