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More details emerge on Quentin Whitwell's bid to lease or purchase Greenwood Leflore Hospital

Friday, October 13, 2023, 4:14 pm News Flash Archive

The deadline to submit bids for the lease or purchase of Greenwood Leflore Hospital expired this afternoon at 3 pm.

Meanwhile, more information has come to light about the one bid the public has been told about so far.

The Taxpayers Channel first reported on the bid filed by Progressive Health Enterprise, a hospital management group owned by Quentin Whitwell, a well-known entrepreneur and specialist in turning around shaky hospitals in rural Mississippi. See our original reporting here: Quentin Whitwell enters bid for Greenwood Leflore Hospital RFP

At least two other bids have been discussed privately, but The Taxpayers Channel has not been able to confirm whether they were actually filed.

The Taxpayers Channel has reviewed the Whitwell group's bid to lease GLH, with the intent to purchase it at fair market price if financing can be arranged.

According to the bid, Whitwell's group would lease GLH starting January 1, 2024. At that time, Whitwell's group will take over operations and assume responsibility for the hospital.

Whitwell proposes to pay a token one dollar per year for the lease for a term of 25 years.

Significantly, Whitwell's bid proposes to take on GLH in its current condition. This is contrasted to UMMC, which demanded the city and county first pay around $4.5 million in deferred maintenance costs.

The bid states that Whitwell's group will invest in infrastructure improvements, tech upgrades, and recruitment of medical professionals.

The bid promises to expand the range of services offered at GLH.

The bid proposal discloses that the executive leadership of Whitwell's group includes Dr. Kenneth Williams, who himself acquired, reopened, and revitalized the Holly Springs Hospital in 1991. Now known as Alliance Healthcare System, it operates a 40-bed hospital, and a cluster of hospice care, clinics, and other service providers in Holly Springs.

The bid provides descriptions of Whitwell's other successful turn-around hospitals, including his purchase and reopening of the Quitman County hospital in Marks, and the Panola County Medical Center in Batesville.

Whitwell's group is one of the first to adopt and obtain Rural Emergency Hospital status for two of its other hospitals, but does not expect GLH to be down-converted.

According to the bid, the Batesville hospital has seen increases in services offered, recruitment of additional doctors, and ancillary clinics opened since Whitwell bought it in 2019.

The bid provides examples of Whitwell's medical management expertise in upping reimbursement levels, correcting billing deficiencies, and cutting costs. An additional profit boast can come from converting some hospital clinics into rural health clinics, which receive higher reimbursement rates from the federal and state governments.

The bid specifies that Whitwell's group will maintain all employees and services during the first 90-day period of its lease, as it performs a top to bottom assessment of sustainable employment levels and patient services.

Significantly, the upper level management jobs will not be guaranteed during that early period.

After 90 days, Whitwell's group will have full authority to make changes in employees and patient services that it deems necessary to returning GLH to financial profitability.

The bid summarizes Whitwell's "turnaround plan" for GLH, which focuses on pursuing revitalization, financial stability, and a sustainable road forward. It includes additional staff training and enhanced operational efficiency. It also includes extensive community outreach, and necessary capital improvements and modernization.

The bid pledges to sustain current levels of charity care, and to preserve acute care beds, rehabilitation, surgery and emergency room services.

The bid discloses that Whitwell's group now has approximately $39 million in property and equipment assets.

In 2019, Whitwell and his partners purchased the Panola Medical Center in Batesville out of bankruptcy for $2.5 million, and were able to turn around that hospital to profitability, saving 700 jobs in the process.

In 2021, based out of Batesville, Whitwell and his team reopened the Quitman County Hospital in Marks, which had closed its doors in 2016. Rebranded as the Quitman Community Hospital, it has now regained federal designation as a critical access hospital, a designation it had previously held since 2004 until it closed.

GLH is in desperate financial trouble, surviving month to month on grants and loans from its owners, the city of Greenwood and Leflore County. It awaits word from CMS whether it will be granted critical access status, without which, hospital management has asserted, the hospital will have to close. See our previous reporting here: Even with critical access designation, GLH FY2023-2024 proposed budget projects operating loss of $5.4 million

As a last resort backup plan, the city and county owners have issued a "Request for Proposals" (RFP) soliciting bids to lease or purchase the hospital. This came after a failed RFP last summer, which attracted only one bidder, University of Mississippi Medical Center. But UMMC pulled out of negotiations when the Board of Supervisors refused to agree to provide its share of $9.1 million that UMMC asked the owners to pay for deferred maintenance and to settle around $5 million in money owed by GLH to Medicare.

To read our previous reporting on the new RFP, see here: Round Two in Greenwood Leflore Hospital RFP for lease or sale

Whitwell told The Taxpayers Channel that he would file an updated, more detailed bid before today's deadline, answering point by point the specifications of the hospital RFP.

Several items still to be addressed include:

Whether Whitwell will pay off the $4.6 million to Medicare that GLH presently owes.

Whether Whitwell will assume responsibility for the GLH employee pension fund, which is presently underfunded by $19 million.

Provide a definite purchase price if Whitwell exercises the option to outright buy GLH from its two owners, the city of Greenwood, and Leflore County.

Whether the city and county will give a waiver of the $75 million net worth requirement in the RFP.

Whether Whitwell's group will commit specifically to spending $10 million for capital improvements in the first five years of the lease of GLH, as required by the RFP.

Also of interest is what Whitwell's plans are for replacing GLH's obsolete Electronic Health Records system, which must be done in 2024. A ten year cost of $27 million has been bandied about by hospital administration officials. See our previous reporting on this matter here: GLH loses $1.94 million in October 2022, available cash down to $1.84 million

Meanwhile, there is still no word on the critical access status application from CMS. The initial denial by the CMS regional office in Atlanta is on appeal to top CMS officials in Washington, DC.

To review our reporting on GLH and its financial woes, please see here: Index of Greenwood Leflore Hospital news articles

John Pittman Hey
The Taxpayers Channel

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