Many ponder whether or not the hospital was closed prematurely

Published 12:00 am Sunday, February 1, 2004

In January 2001, employees at River Valley Hospital walked away from their jobs and into what some described as an uncertain future.Where would they work now?

The hospital itself faced an uncertain future.

What about the pile of debts left unpaid? Why had the hospital been forced to close? And should it have closed at all?

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These questions are still debated, three years after River Valley Hospital closed.

A little history

In the wake of revelations that the hospital had amassed millions of dollars in debt, most hospital board members resigned in December 2000, allowing for a new board to be seated.

Within a week, eight new members of the board had been appointed: Dr. Rodolfo Canos and Jim Weber, who had both served previously on the board that just resigned, then-Lawrence County Economic Development Executive Director Pat Clonch, Wayne White, Dick Craig, Dr. Bill Dingus, former dean of Ohio University Southern, Dr. Jim Milleson and former Lawrence County Commissioner Bruce Trent.

Later, the appointing authority named two ex-officio members - meaning they could attend meetings but could not officially vote - Dr. Gail Feinberg and Dr. David Porter.

On Jan. 17, hospital officials announced the facility would close its doors at the end of the month.

Did it have to close?

Most members of the hospital board contend that River Valley had no choice since none of the options explored in the last days of the facility's operation afforded a reasonable chance of survival.

"I don't think that we left any stone unturned," Clonch said. "We looked at everything that could possibly be done. It was obvious that there was no future income to meet current needs. I think that situation would not have occurred if the hospital had had professional administration. It appeared to me that it was out of control and that no one was in charge."

Clonch pointed to one of the first meetings between the new hospital board, the commissioners and the hospital administrators as an example of this.

"In our first meeting, (Commissioner) George (Patterson) asked me what we needed to do. I said, 'We need to see the financial statements,'" Clonch said. "So at the next (hospital administration) meeting they brought us a hand-written statement. You couldn't make any sense out of it.

"Finally, when we got the financial statements, it looked like we owed $18 million," Clonch said. "(And) they swore they were current in collections, which was so far from the truth."

Board members Dingus and White said a number of different avenues were pursued in trying to find a way to keep the hospital open.

"We asked for help from county, state and national government leaders," Dingus said. "I personally talked to Ohio Hospital Association representatives. Real efforts were made."

Dingus said the pile of debts that had been amassed by the hospital - estimated at that time to be approximately $18 million - was the biggest obstacle to keeping the hospital open.

"Naturally it was so difficult when lines of credit were closed or cut off," Dingus said. "It was a tough situation."

Another problem was that the hospital had lost its credibility both with financial institutions and the public, board members said.

"When you take the $18 million that was owed banks and vendors, and most of that was on the backs of local people," Dingus said.

Clonch agreed and added that nothing was going right for the hospital.

"We were certainly stigmatized at that point," she said. "We didn't have patients, we didn't have money and we didn't have capacity to operate it."

Two options for survival

Two possibilities openly discussed at the time to keep the hospital open eventually did not become reality: one was an affiliation with the now-defunct Genesis Hospital. In late 2000, hospital officials announced they were discussing a possible affiliation with the Genesis Hospital System.

"As stated before, we are interested in some type of affiliation and we have been having those types of discussions with Genesis. If it occurred that type of affiliation allows this hospital to retain its autonomy," then-Chief Executive Officer Terry Vanderhoof said in December 2000.

Such an affiliation allowed the hospitals join together to make bulk purchases of daily use items at a cheaper rate and when making strategic plans for new services. Genesis was created in 1997 and was dissolved in January 2002.

The other option discussed was to seek funds from the state-run Critical Access Hospitals Program.

Critical Access, funded through the federal Health Care Financing Administration and administered by the Ohio Department of Health, aims to keep rural hospitals afloat.

But at that time of the hospital's closing, hospital board leaders called the idea "a less than perfect plan."

Hospital board chairman Jim Weber said in January 2001 that the program would have meant a drastically scaled-back hospital.

"We want RVHS, whether it's taken over or run by someone else, to be as close to being a primary care facility as it possibly can be," Weber said in 2001.

The Critical Access Hospitals Program would have allowed the hospital to collect full Medicare reimbursements.

To have qualified for the Medicare portion, River Valley must have had no more than 25 beds, discharge patients within an average of 96 hours and have transfer agreements with another hospital.

Although River Valley was licensed for more than 180 beds, it only staffed 60 at the time of its closure.

Doctors also tried to help improve the chances of keeping the hospital open. Dr. William Basedow said he knew of some physicians who officially offered their services free of charge for three months, in an effort to keep the hospital open.

Dr. Jim Milleson, who was also on the hospital board at the time the hospital closed, declined to comment on his tenure on the board.

Board member Dick Craig said he was not well last week and did not feel like commenting, but said he may comment later.

Some express doubt

While board members contend that options to keep the hospital open had been exhausted, others within the community believe otherwise.

"The hospital should never have been closed," said Keith Molihan, outgoing executive director of the Ironton-Lawrence County Community Action Organization. "The primary debtor was the federal government, and the federal government doesn't want to own a damn hospital. Some loans could have been forgiven. There should have been an attempt made to work their way out of these difficulties. Just go to the creditors and ask for relief."

Molihan said one federal program provides $1 million a year to local community hospitals. Molihan said the hospital administration should have reduced staff to a reasonable number, contacted its creditors and made a reasonable attempt to reorganize.

Former board member Robert Griffith said he thinks the hospital should have been placed into the hands of a receiver but should have remained open.

"It takes the creditors off your back and you pay as you go," Griffith said. "I think it could have made it."

Griffith said he doesn't understand how the new board could only have been in place a short time and decided so quickly the hospital should have been closed.

"There's no way they could have been there two weeks and known anything," Griffith said.

Court-appointed receiver Bob Payne said the idea of leaving the hospital open but in the hands of a receiver was an option that might have worked.

"They should have looked into it," Payne said. "The court takes control of the assets to preserve for creditors. They could have frozen assets for 60 to 90 days to help build up assets."

Clonch said the mounting debt and the diminished public support and use of the hospital was just too much to overcome.

"When you look in the rooms and there's no one there, you can tell that there's no income," she said. "It doesn't take a surgeon to understand that."

Staff writer Teresa Moore can be reached by calling (740) 532-1445 ext. 25 or by e-mail to teresa.moore@irontontribune.com. Kevin Cooper contributed to this article.