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By Becky Johnson & Julia Merchant • Staff writer

Haywood Regional Medical Center and WestCare announced plans to join forces under a newly created parent company. In addition, they will enter a management agreement with Carolinas HealthCare System, a large hospital system based in Charlotte with 25 hospitals under its wing in North and South Carolina.

“We will gain access to the knowledge and expertise of an organization that has a proven track record of helping hospitals improve their bottom line and grow services in communities,” said Mike Poore, the CEO of Haywood Regional Medical Center.

The decision to enter a partnership with each other and a management contract with Carolinas HealthCare System was approved by unanimous votes by both the HRMC and WestCare boards in separate meetings Monday night (April 20).

The arrangement stops short of a complete merger of HRMC and WestCare. The hospitals will not merge their assets or balance sheets. However, daily operations from a revenue and expense standpoint will be managed jointly.

WestCare CEO Mark Leonard compared the arrangement to the partnership entered into by Harris Regional in Sylva and Swain County Hospital in Bryson City. Both continue to function somewhat independently, although daily affairs are managed as a single unit.

“The two organizations remain separate and district but there was a new parent,” Leonard said.

The primary advantage of a management contract with Carolinas HealthCare is an economy of scale to get better rates and prices on everything from insurance reimbursements to the cost of medical supplies.

“They can go to suppliers whether it is for linens or medical equipment and say, ‘We represented 2,000 or 3,000 beds and we want a better price or we go somewhere else,’” said Dr. Richard Lang, an HRMC radiologist.

Health care conglomerates, often organized under one flagship hospital, are increasingly common. On the other hand, rural hospitals flying solo are increasingly rare. Smaller hospitals struggling to stay relevant in the rapidly changing world of health care are increasingly partnering up.

“I believe this makes really good sense for medical coverage for this section of Western North Carolina, to keep a viable system available to the people here,” said Cliff Stovall, HRMC board member.

HRMC and WestCare will retain autonomy in some areas of operation, but will give up autonomy to the joint parent company in other areas.

“They are going to delegate much of their roles to this (new) board,” Poore said of the current WestCare and HRMC boards.

Exactly how much control would remain with the individual hospitals has yet to be worked out.

“All the details now have to come together,” said Mark Clasby, HRMC board member.

Hammering out the details of both the joint operation between WestCare and HRMC, along with the details of the management contract, could take another six months.

“There is a tremendous amount of work and due diligence that will have to occur,” Leonard said.

WestCare and HRMC will have just one CEO down the road, but neither Leonard nor Poore were concerned about that.

“I think both of our boards have made a brave decision to ensure not only that we keep the services that we have, but that we grow for the future,” Poore said. “It would be selfish of me not to go forward with this because it’s what’s best for the community.”

Other administrative functions, from payroll to purchasing, could also be consolidated, or could even be taken over by Carolinas as part of the management contract.

It is not known yet how much say Carolinas HealthCare Systems will have on the daily operations of the hospital or how much influence on long-range goals and strategies.

“What the trustees and physicians have heard is that Carolinas does not micromanage local leadership and local governance,” Leonard said.

When HRMC first began exploring the prospects of an affiliation with other hospitals, an outright merger was not out of the question. But leaders of the process soon realized there was little to be gained by the loss local control resulting from merger, not even the hoped-for cash infusion to upgrade equipment or expand the hospital.

“During this process, we found out even with a merger there is no cash infusion,” Clasby said.

Retaining autonomy is one reason a management contract was attractive.

“I think that’s one of the things that the board felt strongly about is that it kept control locally and got outside help to improve services,” Poore said. “The management company has really no powers or authority that are not expressly given to it.”

Haywood County Commissioner Mark Swanger said the management contract appears to be the best of both worlds.

“Under the contract, we still retain our independence, but yet we gain many of the benefits that a merger would provide. At this point I think it’s the best of the possibilities,” Swanger said. “I think it will improve healthcare, and I think it will improve the financial health and stability of both WestCare and HRMC.”

WestCare and HRMC said that patients will not be forced to leave their own county to get health care services they currently enjoy at home. Each hospital will still strive to provide the full array of medical care they do now rather than integrate clinical operations, such as cardiologists only operating in Haywood or hip replacements only being done in Sylva.

“I think it is unlikely that we would have that kind of consolidation. Our communities are 26 miles apart. Those kinds of consolidations work when you’re in a very close proximity,” Poore said. “We don’t have any plans to merge services on a local level. I think what would be more likely is that we would work together to create new services.”

That is particularly the case when it comes to highly specialized care, where there could be just one center to serve patients across the counties. Some services are too specialized to offer currently, but the larger patients base that would come with a joint affiliation could help recruit specialties the area doesn’t currently have, Poore said.

Poore says hospital staff, particularly front line staff, will see little if any change in their jobs.

Mission Hospitals in Asheville was the runner up in a quest for a management contract.

“Mission put forward an excellent proposal, but I believe the judgment was that Carolinas has the experience that no other group could match,” Swanger said.

Mission said while it appreciated the opportunity to make a pitch, it was disappointed in the decision.

John Maher, vice president for services at Mission, said that patients in the western counties have a high level of confidence in the health care provided at Mission. During the negotiation process, Mission conducted a survey in the western counties and found that 66 percent of patients preferred Mission over the other entities being considered for a management contract.

Further, Mission’s vision of an integrated comprehensive health system across the region is compromised by the decision to go with Carolinas, Maher said.

Maher also questioned how many jobs may be lost by Carolinas taking over the administrative functions of the hospitals. Those details, of how much Carolinas HealthCare would assume control of, are unknown.

“The language of the operating agreement has not been fashioned yet,” said Gail Rosenberg, spokesperson for Carolinas. “It is going to ba number of weeks before it is as to what pieces and part would be part of that.”

Leonard said he does not expect the referrals of patients to Mission from the western counties to change.

“We have a lot of respect for the folks at Mission, the specialists and sub specialists in Asheville. They do an excellent job for our communities,” Leonard said. Doctors will still have the freedom to refer patients to whomever they pleased, despite Mission not being selected for the affiliation.

“I don’t see the referral patterns changing whatsoever. Mission is a very excellent hospital,” Lang agreed.

Haywood Regional Medical Center could miss out on as much as $750,000 in revenue over the course of a year after missing a federal billing deadline for its new mental health wing.

The missed deadline, which occurred last fall, was the result of a misunderstanding between the hospital and the federal Medicaid office.

The psychiatric unit is eligible for a higher rate of Medicare and Medicaid reimbursement than other hospital units. To qualify for the higher rate, the new wing had to be visited by state inspectors and get certified.

State surveyors told the hospital to apply for the survey by mid-August of 2008 in order to meet a cut-off date of Oct. 1. If the hospital missed the deadline, it would have to wait a full year for certification that qualifies it for the higher rate.

This is where state surveyors got picky. The surveyors received the hospital’s application for a survey on Aug. 19, “a date which apparently the state does not consider to be mid-August, although two of the four days in question were over a weekend,” explained hospital CFO Gene Winters, who didn’t work at the hospital at the time.

The state told the hospital that its request was four calendar days late — forcing HRMC to wait another year before it can qualify for a bigger return on the psychiatric unit.

The 16-bed unit has been mostly full since it opened in October of last year, thus serving as a steady source of revenue for the hospital, between $250,000 and $300,000 a month if the unit remains near capacity.

The amount of revenue the hospital is missing out on could be as high as $750,000 over a 12-month period until the window rolls around to get the unit certified, Winters said. According to Winters, the true budget impact from the missed deadline will likely be small, around $300,000. The hospital had budgeted for the psychiatric unit conservatively.

“We are in the process of sharing the pain of the reduced revenue with our psychiatric unit management company, so the impact to the hospital will be minimized,” Winters said.

— By Julia Merchant

The prospect of an outpatient surgery center in Haywood County has drawn support from 14 doctors willing to pitch in on a feasibility study to get the ball rolling.

Haywood Regional Medical Center will split the cost of a $40,000 study with interested physicians. It could lay the groundwork for a joint venture between the hospital and private doctors in the construction of a surgery center down the road.

A surgery center would be more convenient for patients, who now have to navigate floors of the hospital for even the simplest of outpatient procedures like cataracts and colonoscopies.

A new surgery wing was well on its way to a ground breaking early last year. Architects were in the final phase of the design, with interior color palettes already selected. But the entire project came crashing down when the hospital lost its Medicare and Medicaid status after failing federal inspections in early 2008. Savings squirreled away to pay for the surgery wing were spent instead to keep the hospital afloat until it rebounded from the crisis.

While involvement from 14 doctors in the feasibility study might sound unwieldy, Haywood Regional CEO Mike Poore welcomes the broad interest. The threshold for the venture to be successful is between eight and 10 physicians, so it’s good to have so many, Poore said.

“It is important to me to make sure we have physicians involved,” Poore said.

The attitude marks a change from the former hospital administration, which excluded participation by physicians. For years, surgeons tried to make the case for a joint venture with the hospital to build and run a surgery center, but to no avail. Former CEO David Rice, known for his top down control of the hospital, wanted a surgery wing under the exclusive domain of the hospital rather than a joint venture preferred by the overwhelming majority of doctors.

A joint venture provides a better business model for doctors, who want more autonomy and to build equity in their own practice.

“I think it creates a better relationship between the hospital and physicians and helps with the recruitment and retention of physicians in the community,” said Dr. Chris Catterson, an orthopedist.

Stand-alone surgery centers are such common fixtures these days that the lack of one means some doctors wouldn’t consider coming here, according to Dr. Al Mina, a surgeon.

Mina said that a surgery center will streamline the process for patients. Check-in will be quicker. Families will have a better waiting area. Parking would be closer.

It’s also cheaper for the patient. Under the strange formulas used by insurance companies, the co-pay is lower for the same operation at a free-standing surgery center versus a surgery wing attached to a hospital, doctors explained.

“It’s important not just to have a fancy new building that people feel comfortable going to, but the out-of-pocket cost to the patient is lower from their insurance company,” said Dr. Richard Lang, a radiologist.

A stand-alone surgery center would also be cheaper to build than trying to shoehorn a wing onto the hospital, Mina and Catterson said.

The project being pushed by Rice had a price tag of $16.5 million. It not only included a makeover of the surgery wing, but also a new main entrance and lobby for the hospital, new offices for hospital administration and “shell space” for future expansion of the hospital. The new wing would have had an over-built foundation that could support up to seven stories in the future.

Poore is no novice when it comes to launching surgery centers. The consultants selected for the study, called Stroudwater Associates, did a similar study at the hospital in Georgia from which Poore moved from.

The consultants will evaluate the demand for a surgery center, factoring in demographics and HRMC’s market share.

“You don’t want to spend millions building one and find out you don’t have the volume to support it,” Catterson said.

The meat of the study will examine possible business models, such as how much will be owned and run by the hospital versus the doctors. Poore said he expects the consultants to develop a tier of options.

One final question is where to build it.

“There is no predetermined location. Part of the study is to take a look at possible locations,” Poore said.

Once the consultants get started, Poore expects the study to take less than two months.

The Haywood Regonal Medical Center Foundation had $400,000 in donations in the bank for the surgery support wing prior to when the crisis hits last year. A hospital board member asked at last week’s board meeting what will happen to funds raised for the surgery center.

“The surgery center has been put on the backburner, so donors can donate their funds elsewhere or their funds can be held,” said Robin Tindall-Taylor, Foundation director.

It’s a cultural tradition in nearly every society, the firm belief that people and institutions become stronger once they’ve been tested. Whether that test comes about due to one’s own shortcomings or to circumstances outside one’s control is important, but in the end it’s the outcome that we remember.

So it is with Haywood Regional Medical Center. When its Medicaid and Medicare status was lost just over a year ago and the hospital went into a financial freefall, people were angry, upset and felt betrayed. They were also very worried that the place they considered their number one healthcare option was in real jeopardy of closing down and that many friends and neighbors would lose their jobs.

In hindsight, that extreme emotional attachment to HRMC might have been its saving grace. County leaders, physicians, hospital staff, and a whole lot of concerned citizens stayed with HRMC when it might have been easier to let it sink. When the number of patients going to the hospital on a daily basis sank to single digits, inspectors still hadn’t given their final OK for re-certification, and the bank account was close to running dry, closing seemed imminent.

No one knows what corporate shape HRMC will finally take — affiliation with another hospital system and with WestCare seems certain, but the structure of that affiliation is still unknown — but now no one believes that Haywood County won’t have a hospital, which seemed a very real possibility in early March of 2008.

So what from this past year at HRMC should residents remember?

First and foremost is the responsibility that lies with the hospital’s board of trustees. These dedicated citizens who volunteer their time must be vigilant to strike a balance between the sometimes competing interests of hospital administrators and the medical staff. They must also be able to look beyond those personal and professional relationships to keep in mind the hospital’s value to the community. No person or group is more important than the institution. It’s a balancing act, but if trustees tip too far one way — as happened with the previous board’s almost blind allegiance to former CEO David Rice — bad things can happen.

Secondly, and probably just as important, is the wisdom and dedication of the long-time members of the medical community. When the medical staff asked some doctors to speak to the board of trustees at a December 2006 meeting, they pointed out very clearly that the relationship between the administration and the medical staff had become dysfunctional. The board, however, ignored those pleas.

Among those to speak at that meeting — where a well-liked ER group was about to be fired — were Dr. Henry Nathan, Dr. John Stringfield and Dr. Benny Sharpton, three of the county’s most respected physicians. HRMC’s medical community, by and large, are practicing medicine for the right reasons and need to be listened to.

Lastly, and like it or not, the CEO of a small hospital carries a lot of power. That can be either beneficial or detrimental, depending on the circumstances. If one went to Raleigh or Charlotte, the CEO of a large metro hospital might get lost among the thousands of employees, hundreds of doctors, and dozens of administrators. Not so at a hospital like HRMC. Former CEO David Rice was very powerful and became very polarizing, yet his strength of personality blinded those who should have seen his shortcomings.

HRMC’s new CEO Michael Poore will also wield a lot of influence. He has become the new face of HRMC, an affable, intelligent guy that has best been described as a “breath of fresh air.” Most believe he will serve the hospital well, and already he is restoring credibility both internally and in the community.

HRMC has survived and, perhaps, become stronger because of this crisis. It might not be so lucky if an event of this magnitude ever occurs again, a truth that should serve as a cautionary reminder to those who might too quickly forget the events of the past year.

HRMC: A timeline

Oct. 2006-Feb. 2008 — HRMC has several problems with federal inspectors, culminating in the threat to revoke its ability to get reimbursement for Medicare and Medicaid patients.

Feb. 13, 2008 — HRMC given notice that Medicare funding will be revoked Feb. 24. CEO David Rice does not go public — even to his board or the medical staff — in hopes of passing a last ditch follow-up inspection.

Feb. 22, 2008 — HRMC fails follow-up inspection. Legal notice appears in Asheville Citizen-Times that says HRMC will no longer be eligible to receive Medicare reimbursements, which alerts community.

Feb. 24, 2008 — Medicare and Medicaid status revoked at HRMC.

Feb. 25, 2008 — David Rice resigns as CEO.

March 3, 2008 — Hundreds gather at HRMC wearing purple ribbons to show community support for the hospital as it slips further into its financial morass.

March 6, 2008 — HRMC Board Chairman Dr. Nancy Freeman resigns her seat, saying in a letter she wants “the healing to begin.” Dr. Henry Nathan appointed to replace Freeman on the board but not as chairman. Glenn White later appointed chairman.

March 10, 2008 — Consultants hired to help HRMC re-group issue an assessment blasting administration of former CEO David Rice, citing a “significant leadership failing.” Also, Future Directions Committee begins public discussions of potential merger options with another hospital or hospital system.

April 17, 2008 — HRMC passes Medicare inspection, first step toward full recertification.

May 21, 2008 — HRMC passes final inspection and regains Medicare and Medicaid certification.

Aug. 20, 2008 — Interim CEO Al Byers says hospital is breaking even for first time since crisis started.

September 2008 — Interim CEO Al Byers steps down, the last of the top administrators who worked under Rice to depart.

Oct. 1, 2008 — Michael Poore hired as new CEO for HRMC.

Today at HRMC, 10 sets of eyes peer over the shoulders of the hospital administration, ready and willing to question every move.

Though the hospital had a board of directors in place when the hospital lost its Medicare and Medicaid certification a year ago, oversight arguably wasn’t the board’s strong suit. But today, the buck stops with the hospital board when it comes to avoiding another crisis.

In the months following the hospital crisis, it was out with the old, in with the new on the hospital board. The original board members either resigned or didn’t reapply for their terms. A host of Haywood residents, appalled by the hospital’s downfall, were more than happy to step up and play watchdog. When two seats became open in April, county commissioners were flooded with a staggering 37 applications (in contrast, many boards are happy when one person applies). Seven out of 10 sitting board members today are new since the crisis.

The clean sweep will continue in April, when long-time board member and chairman Glenn White will step down and the board is expanded by two. When that occurs, only two out of 12 board members will have been in place under Rice.

“It’s good to have those without experience, because they keep it fresh,” said Cliff Stovall, who was appointed to the board in June. “You don’t want to just do it the way that it’s always been done.”

Board members come from a wide range of backgrounds: a banker, a retired Army colonel, a former district attorney, a nursing instructor, to name a few.

“I think it’s important to have people that aren’t entirely immersed in medicine, because it brings a different point of view,” said Pam Kearney, who also came on board in June.

 

Back to basics

Defining just how the board is supposed to function has been a top priority. Since the crisis, the board has had to do some serious reinforcing of its core mission — overseeing the hospital administration.

“We didn’t have any concept of what the board’s duties were,” said Roy Patton, who became a board member in June. “There had been more or less a structure for the board, but I don’t think that the board had ever learned to use it. The former CEO kept the board pretty much in the dark.”

That’s not the case anymore.

“The board’s role is oversight, and I think we’ve come to realize how much more important that is than we may have realized at one point,” said Patton.

 

In the drivers seat

The revamped hospital administration has made it much easier for the board to perform its duty as watchdog. Former CEO David Rice held a tight grip on the flow of information, so what the board knew about day-to-day hospital activities was limited.

“We asked questions in the past, too, but it’s the answers and responses that you get that are key,” said Mark Clasby, a board member who had served for a year and a half when the crisis hit.

“I think that the board was just somehow lulled into pretty much an acceptance of what Rice said was going on,” Patton said.

Consequently, HRMC’s loss of Medicare and Medicaid certification caught board members completely off guard.

But as the hospital’s culture began to change in the wake of the crisis, so did the relationship between the board and the administration.

“I think the thing that I see changing is that the board members and the administration are actually having dialogue and discussions,” said Kearney. “It’s not a one way street. The communication lines are now open, and board members are not denied access to information.”

Kearney said the board has demanded the larger role.

“I think the board really is driving it,” Kearney said.

Since the crisis, the board has put measures in place to make sure it’s not kept in the dark.

For example, an immediate notification process requires the hospital administration to notify board members of any incident affecting HRMC.

“It allows the board to be in the loop of information from day one,” said Kearney, “so we don’t read about it in the media or find out about it secondhand.”

In contrast, Rice kept such incidents a secret from the board. Board members were unaware of the brewing crisis a year ago that the hospital’s Medicare status was in jeopardy.

Board members also now attend exit interviews when any hospital inspection is completed, which “enables the board to learn firsthand if there are serious patient concerns,” said Kearney. “This was discouraged in the past.”

At a recent exit interview, surveyors even opened up the floor so board members could ask questions — something Kearney recognized as a real turning point for HRMC.

“There was not one person in the hospital who was going to make or break that survey, as was the case in the past,” she said.

Haywood County Commissioner Kevin Ensley, who along with other commissioners appoint the hospital board members, said the crisis should serve as a wake-up call to anyone serving on a board to be more diligent in their oversight. Too often, those at the helm of an organization can lull their board into complacency or charm them into compliance.

“If you tried to remove David Rice two weeks before that happened there would be a firestorm,” Ensley said. “The one good thing that has come out of this is all the boards in the county see you really have to watch what management is doing. We could all point our fingers at ourselves because people weren’t paying attention.”

 

Not afraid to ask

The idea of the board taking the wheel marks a sharp change from before the crisis, when decisions were often made in a unilateral manner by the administration.

“I don’t think that we would now be able to have that same reliance (one the administration),” said Patton. “I think we’re always going to be saying, is this right?”

Today, there is no shortage of questions for hospital administrators at board meetings.

“I can assure you that nobody leaves without getting questioned to the hill,” said board member Cliff Stovall, who was appointed in June. “There’s no timidity on the board. There are no wimps in the meetings I’ve been in.”

Board members hope a renewed emphasis on oversight and open communication will ensure they’ll never again be blindsided, as was the case a year ago.

 

Turnaround?

Though the hospital is still on a road to recovery, board members say there have been some key turning points since the crisis.

Patton says positive change began to take hold right away.

“I think that immediately, when things fell apart, some things started turning around,” he said. “All of a sudden, we had training going on, and more attention to the things that we hadn’t been paying attention to earlier.”

Stovall said one of the board’s biggest accomplishments since the crisis has been getting the hospital’s finances back in the black. The hospital’s lack of debt made this easier, he said.

“We did spend a lot of money just to keep going, but our money did not evaporate,” Stovall said.

Clasby said as of December, the hospital was ahead of its budget for the year — a positive but preliminary sign, since the fiscal year only started in October.

Board members also named the hiring of CEO Mike Poore as a key accomplishment.

“It’s just been a breath of fresh air for us,” Patton said.

Board members expressed mixed sentiments on whether the hospital has overcome one of its greatest challenges: regaining the community’s trust.

Stovall said he views the frequently full parking lot at the hospital as a sign that people are coming back.

“I think that’s an indication that people are using it, so it’s restored confidence,” he said.

Patton was a bit more hesitant.

“I would say yes, there has been some trust regained, but I don’t think that we’re to the point where we can say, we’ve done it now and we can relax,” he said.

Kearney also says there’s work to be done.

“The community sentiment is more positive toward the hospital than a year ago, but we haven’t yet seen a sufficient increase in the daily census,” she said. “I think that’s the only tangible way you can measure that. I would say there are people that are going past Haywood and going to Asheville.”

 

Phoenix rising

The crisis that hit Haywood Regional helped to erase a culture of fear and overhaul the hospital’s administration and practices. So is HRMC better off for it?

“That’s a real difficult question, because you just blew $10 million,” said Kearney. “We spent some of our future, which is unfortunate.”

Clasby says that in the end, HRMC did emerge as a better hospital — though the road to get there was tough.

“It’s a shame and it’s sad that we went through what we did, and it was very painful for the community,” he said. “But we had an opportunity unfortunately to correct the things that were wrong and to rebuild this into an excellent, quality institution. It’s kind of the rising of the phoenix.”

As Mike Poore waited for an elevator between floors at Haywood Regional Medical Center Monday morning, he gazed out the sixth floor window to see cars circling the packed parking lot hunting in vain for a space.

“That’s a good problem to have,” said Poore, the hospital’s new CEO.

It’s a far cry from a year ago, when the parking lot was nearly deserted. Haywood Regional had lost its Medicare status after failing a federal inspection. An exodus of private insurance companies followed, and daily patient counts plummeted to single digits.

The hospital dried up for more than three months while rebuilding its inner workings. The progress of the past year is astounding, but there remains a long road ahead. The community is pinning hopes on Poore to get it there.

Poore won’t shoulder the entire burden of rebuilding the hospital. But he could make or break the efforts. In the people he hires, the tone he sets with doctors, the course he steers in merger talks, the financial advice he gives the board, Poore holds more sway over whether the hospital succeeds than any single person.

Doctors in particular are relying on Poore’s ability to turn things around. So far like what they see.

“I think Mr. Poore has been a breath of fresh air. He is forthright and accessible and seems to be knowledgeable,” said Dr. Steven Wall, a long-time physician in the county with Haywood Pediatrics.

The sentiment seems unanimous. When asked to reflect on the hospital’s progress over the past year, Poore’s arrival appears high on most doctors’ list.

“I have high hopes for HRMC and the new leadership we have in Mike Poore and the team he is building,” said Dr. Shannon Hunter, an ENT.

Poore and his near sweep of top managers ushers in a new era for Haywood Regional. His style is vastly different from his predecessor, David Rice. Rice was commanding and authoritative, while Poore is cooperative and congenial.

The medical community harbored distrust toward Rice, but see Poore as someone who will look out for their interests.

“I think we’re still in the honeymoon stage, but I believe this administration seems to be a lot more transparent,” said Munoz. “I have heard staff say they can discuss problems and issues much more openly than the prior administration.”

Pam Kearney, a hospital board member, agreed that it’s premature to pass definitive judgment on whether Poore will succeed, since he’s just four months into the job so far. But like Munoz, Kearney believes Poore is promising.

“He seems to get along well with the hospital staff and medical staff. The comments we’ve gotten have been very encouraging, and his interaction with board members is transparent and open,” Kearney said.

Poore, 44, left a job at the helm of a five-hospital system in the greater Atlanta area to come here. He stood out in interviews, according to Dr. Henry Nathan, a hospital board member who helped hire him.

“He seemed to be very committed to wanting to do this. He was excited about the prospect of having this job,” Nathan said. Nathan said it was obvious in the interview that he knew how to run a hospital.

Poore says he was attracted to the job for the challenge and desire to make a difference.

 

Assembling the best

One of Poore’s greatest strengths lies in the people he’s hired. The hospital has replaced nearly a dozen department heads, vice presidents and manager types in the past year — the majority since Poore came on board. There’s a new chief finance officer and chief operating officer. New department heads are found through the hospital from human resources to nursing to the emergency room. Some jobs, like quality oversight, are still being filled.

Before Poore arrived, the hospital was run largely by Compass, a consulting group hired to rescue the otherwise sinking ship. Compass initially worked in tandem with administrators left over from Rice’s era.

When Poore’s arrived, he began building a permanent team.

“He has brought with him an excellent group of upper and middle managers,” said Dr. Richard Lang, a radiologist. “A lot of the folks he has brought with him he has known in other places. I think they look on this as a challenge and they are doing a great job.”

Poore called on people he knew from the industry for key spots in the cabinet, assembling a team with higher qualifications and experience than HRMC has seen before.

“We came because Mike asked us to,” said chief operating officer Teresa Reynolds. “We have a lot of respect for Mike. He has good business and leadership skills. He has pleasant personality. He is an easy person to get along with.”

Dr. Henry Nathan, a gastroenterologist, said Poore’s ability to attract top talent has been an asset.

“One thing that he brings to the table is his connections and knowledge of so many talented people. He can say, ‘boy, I’d like to get so and so to come work here with us,’” Nathan said.

Poore is quick to credit the longtime employees for helping to pull the hospital through.

“There are a lot of people who were here through the storm,” Poore said. “There are really conscientious smart people who take care of patients every day, and they’ve been here throughout.”

For the big picture of steering a hospital, Poore said the influx of fresh ideas from across the country that are manifesting in his new team certainly don’t hurt.

Poore has also enlisted the help of a recruiter that specializes in health care fields. That helped land one of the most important posts: the chief finance officer. Gene Winters, the CFO, is a dynamic numbers guy who relishes in saving struggling hospitals. He talks about fixing hospitals like most talk about a trip to the grocery store. Winters was attracted to the challenge of pulling HRMC up, but more importantly wanted a good community in which to raise his new son.

“It is a place where I could be challenged and also be a hero, to be honest,” said Winters, who has a connecting door to Poore’s office.

 

Where to start

Poore’s first day on the job in October was likely overwhelming. Cash reserves were dwindling, patient confidence was still shaky, doctors were sizing up his every move as they decided whether to stay put or jump ship, and staff were walking on egg shells in constant fear of surprise inspectors.

“One of the things I had to do was accelerate my learning. I had to learn as much as I could as quickly as I could,” Poore said. “I set up a learning plan to educate myself from people internally and externally about the hospital about all the information in the hospital.”

Poore ultimately held face-to-face interviews with 120 people in the medical community, the hospital ranks and the community at large. He asked them for their thoughts, ideas and perceptions on what the hospital needed to do. He asked them what landmines to avoid, what needed changing and how he should go about it.

That first move was savvy. It bought Poore face time with people he needed on his side: the hospital board, doctors, key staff, county commissioners and VIPs in the community.

“He was pretty smart. A lot of people come in and make changes, but the first thing he did was interview everyone he could find to find out what we knew and what we thought,” said Cliff Stovall, a hospital board member.

For most doctors, the interview was their first encounter with Poore. When Poore showed up at their office with lunch in hand, it immediately showed a marked difference from the former administration. Past CEO Rice rarely sought opinions from the medical community. In fact, some doctors feel Rice actively discouraged their input and squelched their ideas.

Trust was lacking under the old administration. But Poore’s ability to listen sent a message to doctors and staff that they could trust him.

“He met with just about every physician face to face and asked us what could he do better, how could he help improve things in the hospital,” Lang said. “I was very impressed that he was such a good communicator.”

The interviews those first few weeks set the stage for future interactions. Doctors felt valued and saw that Poore’s door was always open and he would respond to the their concerns. For example, when radiologists brought up an issue in the medical staff meeting two weeks ago, Poore took it seriously.

“He was in the radiology department the very next day when he had more time to spend on it,” Lang said.

The attitude extends not just to doctors but to the rank and file as well. Morale among nurses and staff has improved under Poore compared to Rice, according to Dr. Al Mina, a surgeon.

Mina still remembers the stinging assessment of Rice’s regime by consultants brought in to help rebuild the hospital a year ago. In a lengthy report, the Compass Group characterized Rice’s regime as a “lone ranger” dictatorship that propagated “a culture of fear.”

“In retrospect, unfortunately, I think that was an accurate assessment,” Mina said. “I don’t think Mike runs his ship in a culture of fear. He is open to suggestions, as is his team.”

The approach is one of Poore’s talents as a manager.

“I give people the tools they need to do their job,” Poore said. “I knock down barriers they aren’t able to knock down and then get out of the way and let them do their job.”

Poore said hospital staff are finally getting the opportunity to shine.

“Whereas in the past they felt like they didn’t have the support of administration,” Poore said. “They tried it once and nobody listened to them. What I am seeing now is people are stepping up and saying ‘I have an idea of how we can improve this.’”

When Poore makes rounds in the hospital, he asks employees what’s working, what’s not, and if they need anything. A believer in positive reinforcement, he also asks if there is anyone he should recognize.

When employees address him as Mr. Poore, he implores them to use his first name.

“He’s Mike to the people in the hospital, and that’s hard for them to get used to,” said Cliff Stovall, a hospital board member.

Empowering the rank and file could well be Poore’s biggest legacy.

“I think one of the main things is that we had to change the culture, and he’s gone about that in a great way by being able to communicate and listen,” said Mark Clasby, another hospital board member.

County Commissioner Kevin Ensley, who was the subject of one of Poore’s 120 interviews, feels like Poore is someone he can call with a concern. Before when Ensley heard complaints, he didn’t know what to do with them, he said.

“I just didn’t think by going to David Rice anything would get done,” Ensley said. “I think now if you complained about a certain situation things would get done.”

 

Taking the fall

Ironically, the hospital’s first chief of staff under Poore is one of the few remaining fans of Rice. The chief of staff is chosen by doctors from among their own ranks to serve as a liaison between them and the hospital and generally represent the doctors’ interests. It’s a duty few envy, given the time it takes away from the doctor’s own practice.

This year, the position went to Charles Thomas, a cancer doctor, who is one of the few who will stand up in support of Rice to this day.

“I do not think Mr. Rice was a bad person,” Thomas said. “I think Mr. Rice was an honorable man who made some errors. It had terrible consequences but he is and was a fine person.”

Thomas remembers the dire straights the hospital was in when Rice arrived in the early 1990s. Rice was the hero then who brought it back into solvency, investing in equipment and recruiting doctors heavily.

“The hospital was almost bankrupt,” Thomas said. “Mr. Rice came here and did an awful lot of wonderful things. There was huge progress.”

Thomas credits Rice with growing the number of doctors in the community, modernizing the hospital and expanding the medical care it offered. Patients and revenue followed. Rice had built a war chest of $19 million in cash reserves the day he left. Rice was saving it to build a surgery wing — including a floor of offices for himself and the administration.

But that money is nearly all gone now, spent to keep the hospital afloat during the year since the crisis.

“I grimly joked we should be grateful to him that the money they saved up got us through,” Thomas said.

Rice’s drive to build ultimately led to his downfall. His energies initially were dedicated to building a quality hospital. But as he amassed more and more power for himself, he pushed aside the interests of doctors, nurses and even patients to make way for his own agenda, according to his critics.

While Thomas is quick to defend Rice, he has also embraced Poore. The two can be spotted regularly over breakfast in the hospital cafeteria.

“He is a good fellow to meet even at 7 a.m.,” Thomas said. “He is bright, energetic, well-educated has a good depth of experience and has a commitment to our hospital.”

Dr. Richard Lang, another doctor who sympathized with or at least understood Rice’s point of view, called Poore an “extremely bright spot” in the hospital’s past year.

 

A better relationship

A pivotal moment for the hospital’s future is whether new doctors come here, and that could largely depend on whether they like Poore. Dr. Steven Wall with Haywood Pediatrics said Poore proved helpful in recruiting a new pediatrician recently. Poore spoke to prospective doctors enthusiastically and ultimately helped land one, Wall said.

The relationship between doctors and a hospital can be tumultuous or indifferent, cooperative or combative, one of admiration or mutual dislike. Under Rice, it was strained at best. Many doctors lived in fear of retaliation for speaking out.

Rice couldn’t exactly fire a doctor — they aren’t employees of the hospital. But doctors rely on the hospital for space and equipment to perform surgeries, deliver babies, run tests, take MRI’s and generally care for their patients beyond office visits.

Should a hospital pull a doctor’s privileges to practice there, it would effectively run them out of the community. Many doctors feared Rice might ruin their reputations in this manner if they expressed concern over the direction he was steering the hospital.

Rice once appointed a committee of doctors to recommend the best software to implement electronic medical records hospital-wide. When he didn’t like the top picks, he disbanded the committee, appointed a new one stacked with his own people and chose the system he wanted all along.

Doctors who were upset by Rice’s policies were barred from going over his head to the hospital board. Rice conveyed the attitude that everyone was dispensable and didn’t seem to care if doctors or nurses walked, chalking them up to a poor fit with the hospital anyway.

The broken relationship between the hospital and administration needed fixing, Poore said.

“There was no basic level of trust in the organization,” Poore said. “I told the medical staff I’m not asking you to trust me. I’m asking you to let me earn your trust.”

Poore also found the lack of communication troubling. The organizational structure was permeated with what he calls “silos.”

“There were silos where the executive teams did not communicate,” Poore said. “They felt these are my departments and I take care of them and these are your departments and you take care of them.”

While Rice controlled the flow of information, Poore encourages it.

“We are constantly receiving emails from him with information about what’s going on with affiliation, with inspections, with specific guidelines. There is much more communication,” said Dr. Munoz, the pathologist. The emails from Poore average twice a week, but Munoz can’t remember ever getting one from Rice.

Poore keeps staff informed by holding what he calls town hall meetings three times a year. It’s not an uncommon practice — West Care’s CEO Mark Leonard holds them with each shift every quarter. But Rice rarely took the podium in front of employees for a state of the hospital report.

Poore has been willing to take his show on the road as well. In the aftermath of the crisis, Haywood County commissioners demanded that hospital leaders to make regular progress reports at their meetings, a practice Poore continued after taking the helm.

“We haven’t even asked him a couple times and he’s just showed up,” said County Commissioner Chairman Kirk Kirkpatrick. “I am impressed with his willingness to come before the board of commissioners and explain exactly what is going on with the hospital in a matter of fact and truthful way.”

 

Surgery center

Poore has already proved willing to cooperate with doctors on a major front: a new surgery center. The hospital has long needed a makeover of its surgery wing.

For years, several doctors tried to make the case for a joint venture with the hospital and physicians. They would share construction costs and run it together as business partners. But Rice preferred to go it alone, with the hospital building and running it all on its own.

“There was a huge wall,” said Dr. Chris Catterson, an orthopedist. “We got shot down very quickly. That’s not the case now.”

Unlike Rice, Poore is open to the idea of a joint venture, and not just because the hospital no longer has money to go it alone.

“It is important to me to make sure we have physicians involved,” Poore said.

The hospital and interested doctors are splitting the cost of a feasibility study. It will determine whether there’s enough demand in Haywood County for a surgery center, and if so, what model would work.

 

Who’s Poore?

Poore set out in college to become an orthopedic surgeon. He had been a heavily-recruited football player in high school but tore up his knee. A series of surgeries landed him in the care of doctors and nurses and the halls of hospitals during an impressionable time, driving him to combine his new-found admiration of health care with his love for sports.

But in college at Auburn, the dreaded organic chemistry course frustrated his plans to become a doctor.

“It kicked my tail,” Poore said. “I started looking around for another career, but I really liked health care.”

Perusing course catalogs, he signed up for classes in health administration instead. What sealed the track was a summer internship at the university hospital. Poore found he loved walking through the doors of a hospital each morning.

“It’s the people in the hospital. There is a different culture there. They go into the health field because they want to help other people. It’s that culture that I love,” Poore said.

Poore made the dean’s list for the next three semesters.

“I was so on fire after that,” Poore said. “I knew that was what I wanted to do.”

Poore got his first job as a hospital administrator at the age of 22. It was several years later before Poore refined his definition of a hospital administrator, though, when his kids were little and asked him what he did at work.

“I told them my job was to take care of the people who take care of people,” Poore said.

Poore’s bible when it comes to hospital leadership is called Hardwiring Excellence by Quint Studer. Poore buys copies in bulk, passing them out to each hospital board member and his management team. The book lays out five pillars of a hospital that must be keep in sight at all times.

During his first month at HRMC, he shared the five pillars with the entire staff during a series of town hall meetings. Poore’s talk on the five pillars has also become a requisite part of orientation for every new hire.

Poore likes the community so far. His three children attend local schools. His wife, Penny, has a seat on the hospital foundation board.

Poore was well-liked at the hospital he left. His going away gift from his old employees occupies prime real estate on his desk along with a photo of Poore driving his antique Corvette in a hometown parade with a bouquet of balloons.

During his first weeks on the job, Poore was talking to a doctor back home about the challenge he faced here convincing the medical community to trust him.

“He said ‘I’ll come up there, I’ll tell them,’” Poore recounted.

People have been impressed not just by Poore’s attitude, but his skills as well. He has been invaluable in talks with larger hospital systems about a possible merger with HRMC.

HRMC was well into talks with other hospitals when Poore was hired. Poore’s first brush with the affiliation team was during such a talk with a prospective partner.

“I can remember sitting across from him and thinking ‘This guy knows what he is talking about,’” said County Commissioner Chairman Kirk Kirkpatrick, a lead player on the affiliation team. “He immediately added a lot to our committee.”

Poore, with the help of his CFO Gene Winters, has made big strides on the financial side as well. HRMC is not only breaking even, but making a few cents. It’s an area everyone is watching.

“You also have to be impressed with the bottom line,” Lang said. “Nothing has overtly changed except the management, and yet we have stemmed the flow of losses every month and are showing a small profit. It won’t be enough to keep us going for 10 years, but it is real progress.”

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Last February, a crisis landed on the doorstep of Haywood Regional Medical Center.

After failing federal inspections, the hospital lost its Medicare and Medicaid status, followed by an exodus of private insurance companies. The hospital effectively shut its doors aside from delivering babies and treating dire emergencies.

The community was scared, confused and angry, confronted with the very real scenario of losing their only local hospital. The future looked bleak and the road ahead a long one.

But a year later, the hospital has bootstrapped itself back into solvency.

Patient count is approaching pre-crisis levels. The hospital employs only 20 fewer people today than a year ago with the equivalent of 748 full-time staff. And after nine months of financial losses, the hospital is not only breaking even but slowly putting money back in the bank.

The hospital’s cash reserves plunged so low during the past year that it had less than a month of operating revenue left. Another few weeks, and the hospital wouldn’t have been able to keep the lights on or make payroll.

“I don’t think people realize how close to the brink this hospital was,” said Mike Poore, the hospital’s new CEO. “We had no backup plan. Our reserves had been depleted. There was absolutely no margin of error. Any bump in the road could be bad. We could have tripped and fell.”

While the hospital’s Medicare status was restored in the nick of time, it was an amazingly fast turnaround.

“That was a huge thing to address the issues and correct them and get it back so quickly,” said Dr. Chris Catterson, an orthopedist. “To my knowledge we are the fastest to ever turn that around.”

The medical community has mixed feelings on whether the hospital is better off today because of what it went through. For critics of the former CEO David Rice, the crisis seems like the only way to shake the hospital free of his hold. Rice had co-opted the hospital board and intimidated the medical community. He had amassed an untouchable level of power over the hospital.

“If you’d tried to get rid of David Rice a couple weeks before the crisis, there would have been a firestorm,” said County Commissioner Kevin Ensley.

The crisis awakened the hospital board and county commissioners to the problems within the administration, said Dr. Luis Munoz.

“It is sad it had to go through that, but I think quite honestly no change would have occurred if we had not been decertified,” Munoz said. “I think the road we were heading down before 12 months ago was not a road most of us wanted to travel. I believe we are headed in much better direction now.”

But whether it was worth the financial hit the hospital took in the process remains to be seen, Munoz said.

Like many doctors, Munoz was depressed last year. The hospital they’d invested their careers around, the community their families had grown to love, the patients they dedicated their waking hours to — all of these were thrown into turmoil and jeopardy. Today, the future is a far rosier place.

“We aren’t in debt and we are generating a profit and are a very viable entity and are getting busier on a monthly basis. I would like to think that is a trend,” Munoz said. “If that’s the case, we may not be out of the woods but we are sure headed in that direction.”

Many doctors believe the hospital will come out better.

“The hospital has become an even stronger entity,” said Dr. Charles Thomas, a cancer doctor and the hospital chief of staff. “I do think we have become a bit of the band of brothers, as Shakespeare said. I think there is the mentality that we came through this together. We have a lot of camaraderie and a very tight team relationship.”

As hospitals struggle under the economy, the crisis suffered by Haywood Regional might actually position it to weather the storm better than most, said Dr. Shannon Hunter, an ear, nose and throat specialist.

“I think what makes us stronger is a sense of pride and ownership in our community hospital,” Hunter said.

Many argue that the hospital pulled through the crisis thanks to the doctors who stuck by it. Only four left, all with bona fide excuses like moving closer to family, going back to school or pursuing a fellowship.

“The fact that we lost so few during the crisis is a testament to our desire to serve this community,” Hunter said.

Munoz agreed.

“We really struggled last year to figure out ways we could keep going, but it is a testimony to the support the medical staff has with each other that we weathered the storm and didn’t bail out,” Munoz said.

It wasn’t easy, however.

“Certainly the first half of the past year was pretty rough, trying to scramble for a place to do surgery and a place to take care of Haywood County citizens,” said Dr. Al Mina, a surgeon.

In an amazing show of generosity, neighboring hospitals like WestCare and Mission opened their doors to Haywood doctors, giving them somewhere to treat their patients.

“It is funny how you find out who your friends are when you have a crisis,” said Dr. Henry Nathan, a gastroenterologist who was put on the hospital board after the crisis.

 

Restoring confidence

A big challenge facing the hospital was restoring confidence in the community. Doctors had braced themselves for the worst, wondering how long it would take for patients to trust HRMC again and whether they would go out of business in the meantime. The hospital dug in for a long tough slog to restore confidence.

“I think it is a little bit at a time. I am a realist to know you can’t just flip a switch and everyone change their opinion,” Poore said. “It is one patient at a time.”

The return of patients to the hospital has been better than most doctors or the administration could have hoped.

“I think that has turned out as good or better than I thought it might,” Nathan said. “It could have been that we had a hard time to get our patients to come back and use our hospital, but it doesn’t seem to have been too difficult.”

Nathan said the community has shown it values a local hospital and prefers to get their care close to home.

A nearly clean sweep of upper level management has helped the public perception of a makeover. The former administration bore the brunt of blame for the hospital crisis. They were lambasted by consultants hired to remake the hospital. The media, the public and medical community quickly followed suit.

With nearly a dozen new vice presidents and department heads already hired or in the process, the public perceives major change. There was a similar sweep of the hospital board, with only three of the 10 board members held over from the old administration.

Some in the community never lost confidence or doubted the quality of care provided at HRMC, Mina said. Those who did are coming around.

“I think they are getting more comfortable with it but not completely restored,” Munoz said.

But in some ways, the job of instilling confidence will never be finished.

“When you have a bigger institution within 30 minutes from here, you always have something to prove, so that might be part and parcel of what we have to do,” Mina said.

Residents of Haywood County enjoy a high percentage of doctors trained in the United States. The percentage of doctors here that graduated from American medical schools rather than abroad is among the highest ratio in the country.

Another factor is the strong referrals from family doctors to specialists practicing at HRMC, whether for gall bladder surgery or hip replacement, Nathan said. Patients will typically take the referral advice from their primary care doctors.

 

Patient numbers

Inpatient numbers — those admitted to the hospital overnight — hovered around 70 per day this month. It’s on par for February of last year before the crisis hit, but that month had been a slow one and makes for a less than ideal comparison. It will take a consistent census of 75 to 80 patients to truly claim a return to pre-crisis numbers.

There’s another factor skewing the numbers. Of the 70 admitted patients Haywood Regional had as of Monday, a dozen were registered to a new mental health wing. That wing wasn’t here last year, flawing the comparison. Remove the mental health patients from the equation and the hospital hasn’t fully rebounded.

A testimony to the low numbers: an entire wing of the fifth floor remains closed. Even prior to the crisis, however, patient count would ebb and flow, prompting the closure of a floor.

The hospital is outfitted to handle 137 patients — that’s with every crib in the nursery filled, every labor and delivery room and every bed in ICU.

Meanwhile, outpatient surgery is still off by about 15 percent over this time last year, as are emergency room visits. Of course, hospitals everywhere are seeing a similar trend due to the economy as people put off care they can’t afford.

Poore has been grappling with how to weigh the numbers.

“One, are we measuring the same thing as was measured last year? Two, how much is a hangover from decertification? And three, how much is the economy?” Poore said. “The difficult thing with stats like this, is you don’t know what you don’t know. You are trying to prove a negative — you are trying to prove who’s not coming to you.”

 

Building a better way

Doctors are united in a feeling that the decertification a year ago was overly harsh and undeserved.

“For whatever reason, it seemed extreme,” said Dr. Chris Catterson, an orthopedist. “If I thought HRMC was a bad hospital or I weren’t happy with the way my patients were treated, I wouldn’t be here.”

Thomas, HRMC’s chief of staff, believes the hospital was penalized for picky things.

“The quality of patient care, the commitment and compassion has never been a question and has always been a priority and always been well done,” Thomas said.

Despite the hard feelings over the situation, doctors are proud of how quickly the hospital turned things around. They overhauled patient procedures, hired a new slate of administrators, appointed a new hospital board, put nurses through rigorous training, and passed new inspections.

“It is pretty miraculous,” Nathan said.

Doctors unanimously cited improvements in the system of checks and balances that govern patient care as one of the top accomplishments of the past year.

“Over the last several months I have noticed a huge improvement overall in the morale of employees and nurses, and in putting together systems for patients being our number one goal,” said Mina.

Thomas said there is universal intolerance among nurses and doctors for anyone who doesn’t follow procedures.

“I think that has permeated our staff,” Thomas said. “I think there has been a marked dedication, people attending lots and lots of 7 a.m. meetings.”

Some might argue HRMC is the least likely place for a patient mishap or error — just like the safest place to stand in a lightning storm is somewhere lightning has struck before.

Since the decertification, HRMC has passed three subsequent inspections, one earlier this month.

“The surveyors were highly complimentary,” Nathan said. “We can be proud of that. It doesn’t mean you can let down. As Poore says, you have to be ready every day to get a spot inspection and not just get ready when you know they are coming.”

 

Value where it counts

A leading contributor to the crisis was overtaxed nurses who weren’t careful enough in administering medication, the main sticking point cited by inspectors. At a management level, the system of checks and balances wasn’t working. Nurses knew this, but when they took complaints to their superiors, their concerns were squelched or buried.

Add to that a large number of traveling nurses, pinch hitters in essence. There had been an exodus of nurses from HRMC blamed on an oppressive climate created by management. The hospital had turned to a greater number of outside nurses contracted to fill shifts on demand but who weren’t as familiar with the workflow procedures.

Even more nurses left during the decertification, forcing the hospital to rehire large numbers in the past six months.

There is an industry wide shortage of nurses, posing an even greater challenged. But luckily, that is Poore’s forte. Poore came from Atlanta, considered one of the most competitive markets for nurses.

“But I had waiting lists for nurses to get into our hospital,” Poore said. Poore focused on creating an environment where nurses would want to get up in the morning and come to work.

As far as that last point, wages were raised at HRMC for the experienced nurses. One problem plaguing HRMC was nurses coming there to start their career, then jumping to higher paid jobs once they got a few years experience. So that upper bracket was targeted with pay increases to keep them from jumping.

By December, HRMC was no longer contracting with agencies to supply nurses.

“That was one of the key issues,” said Munoz. “You have to rely on nursing staff that is permanent and not in constant transition. That is a big plus.”

Poore claims the hospital didn’t lower its standards to hire so many so quickly. In fact, one thing working in his favor was the high number of nurses who still lived here but had left to work at neighboring hospitals. With the old regime gone, they were willing to come back, which gave hiring numbers a boost.

There was still a fair share of new grads, so Poore created for the first time a position dedicated solely to nurse training.

Another big push was to empower nurses and make them feel valued.

“They’ve worked very hard to make the nurses able to do their job with less impediments,” Nathan said.

 

Recruiting doctors

One of the top challenges that lies ahead is recruiting new doctors to the community.

“Our challenges are like anyone else’s in the country. There is a growing demand and not enough doctors,” Poore said.

The list Poore rattled off included orthopedics, urology, general surgery, cardiology, pulmonology and family practice. The list has no particular order. The hospital is recruiting them all simultaneously.

Recruiting is endless for any hospital. Despite the obvious cloud over the hospital the past 12 months, six new doctors relocated here, from an orthopedist to a pediatrician to a family doctor.

But it would be natural for any doctor to be leery of coming here given the events of the past year, especially since so few hospitals have ever lost their certification.

“That bad rap is going to last a little bit and is going to hurt our recruitment efforts,” Munoz predicted.

Dr. Henry Nathan said the right doctors, especially those looking for somewhere to raise a family, will realize the value of making a community like Haywood County home.

“Ultimately we just need to find the physicians who want to live here,” Nathan said.

Thomas thinks every doctor should want to come here.

“We are a growing, prosperous, desirable community,” Thomas said. The hospital is in a great building, is well equipped and faces no debt.

Fresh out of school, doctors already have large debt. Setting up a new practice and building a patient base can be more than they want to bite off, making a small community like Haywood a hard sell.

“Some of these doctors come out of medical school with a debt of $200,000,” Lang said. “With their overhead they cannot afford to practice. We have to fix this and make it possible for them to practice economically.”

One draw for young physicians coming here could be stepping into an active and tight-knit medical community.

Poore has heaped accolades on the medical community since arriving at the helm in October. When asked in a recent interview about surprises he has confronted since his arrival, he cited the dedication of the medical community.

“Often times they are so busy with their practices they don’t get as involved in the hospital as this staff does,” Poore said. “I’ve never been in a hospital that had such an involved and committed medical staff.”

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At a time when the state’s fractured mental health care system seems beyond repair, local mental health officials have hit on a solution that could go a long way toward fixing it.

The key might lie in a new program playing out in the halls of the sixth floor of Haywood Regional Medical Center. The floor has been converted to a 16-bed psychiatric wing, which opened in November and is run by the Smoky Mountain Center for Mental Health. Officials recently took The Smoky Mountain News on a tour of the facility.

The psych ward was established with a state-funded grant given to only two hospitals in North Carolina, one of which was HRMC. Desperate for a way to relieve overcrowding in the state’s mental hospitals, state officials asked HRMC to build a psychiatric unit that would provide more bed space closer to home.

Before it opened, there were no long-term beds for psychiatric patients in all of 15 western counties, and patients had to be transported to Broughton Hospital in Morganton. Often, patients in critical need of immediate care had to wait for days until a bed opened up at Broughton, putting a strain on the patients, their families, and the sheriff’s deputies who had to wait with them.

But with the opening of HRMC’s psychiatric unit, the number of patients going to Broughton from WNC has dropped dramatically, according to the first round of statistics released by administrators at the Smoky Mountain Center. From Jan. 1 through 28, only five patients went to Broughton from WNC — a two-thirds drop over the same period a year ago when 17 patients were admitted from the region.

Smoky Mountain Center officials are hesitant to declare success so early on. But the numbers indicate what is “potentially the lowest admission rate ever to Broughton,” said Smoky Mountain Director Doug Trantham. Trantham said that already, two other hospitals are interested in partnering with the Smoky Mountain Center to instate a similar program.

Smoky Mountain officials believe that the program’s unique model of care, which emphasizes recovery, likely is a big reason for its success rate. The model is in contrast to the institutional model that has traditionally been employed in the psychiatric field.

Under the old model, a patient had to adhere to a strict schedule — waking up, eating, and attending therapy groups at the same time every day. But the recovery model gives the patient more of a say, allowing the patient to decide whether he or she is ready to wake up, or if they instead need more sleep, for example.

Patients in the psychiatric program at HRMC take walks, do yoga, and gather to socialize and play games with other patients.

“It’s a support network that gives you the strength you don’t have outside,” explained a 20-year-old female patient staying at the unit, who spoke about her experience during The Smoky Mountain News’ tour of the facility.

Smoky Mountain Mental Health officials are reporting additional success with their efforts to improve mental health care in WNC. Officials at Smoky Mountain are making steps to re-open the Adult Recovery Unit at the Balsam Center by April, which will provide additional bed space for patients in need of psychiatric care.

“The unit was closed on Dec. 12 following a determination that there were insufficient staff resources, particularly experienced and trained nurses, to safely operate,” both the new HRMC unit and the Adult Recovery Unit, according to Smoky Mountain Center officials.

One of three hospitals courting Haywood Regional Medical Center and WestCare for a partnership has dropped out of the running.

That leaves Mission Hospital of Asheville and Carolinas HealthCare System, a 23-hospital conglomerate based in Charlotte, still in contention. Both have submitted formal proposals, kicking off the next round in the lengthy affiliation process.

WestCare and Haywood Regional have each appointed blue-ribbon committees to steer the process. They will hold a joint meeting Monday (Feb. 16) to review the proposals and kick off discussions of which one is best. The formal proposals are a follow-up to talks held with the entities last summer.

While there’s only two left at the table, others would likely be interested in a partnership with Haywood Regional and WestCare. But invitations were only extended to the three. A fourth was ruled out following the discussions last summer, and others were ruled out earlier in the process.

It could be another six months before WestCare and Haywood Regional have made their decision. They have to weigh what each brings to the table, from medical expertise to a cash infusion, said Mike Poore, CEO of Haywood Regional.

An affiliation could follow a tier of options: an outright merger, a long-term lease, a year-to-year contract or some sort of loose partnership.

While playing Novant and Carolinas against each other would certainly give the home hospitals leverage in the negotiations, Haywood and WestCare still have plenty of bargaining power. If neither proposal meets the standard they want, they can simply choose none of the above, said Haywood County Commissioner Kirk Kirkpatrick, an integral player on the steering committee.

“If either is not beneficial to both Haywood and WestCare then we have to reconsider,” Kirkpatrick said. “It would be bad business not to.”

If neither of the large entities works out, Haywood and WestCare could still pursue a partnership of their own without hitching up to a larger entity.

“I feel like we have a qualified and competent CEO at Haywood and West Care. If they can put something together for the benefit of the entire community they will,” Kirkpatrick said.

 

Conservative times

Novant will not say exactly why it pulled out, although the economy is a likely culprit. Novant operates Forsyth Medical Center in Winston-Salem and a host of smaller hospitals across the state.

A spokesperson for Novant said the hospital was honored to be a top contender, but could not over extend itself at the moment.

“After careful evaluation, we concluded that we needed to focus on our current commitments to capital projects,” said Freda Springs, media spokesperson for Novant.

Novant is building brand-new hospitals in Kernersville and Brunswick County, both in the ballpark of $100 million. Springs said the hospital would not comment further.

Neither Poore nor Mark Leonard, WestCare’s CEO, had additional insight as to why Novant dropped out.

“That is for them to explain if they choose to explain it,” Leonard said.

The letter from Novant announcing its withdrawal was only two paragraphs. Poore speculated, however, that is was likely the economy.

“They are like everybody else, trying to look at the economy and trying to decide what the future is going to be and none of us really know that,” Poore said.

If hospitals are reining in their resources, the deals on the table today might not be as good as they would have been two years ago, or two years from now. But Poore said there is no way of knowing that.

Poore’s bottom line: “This hospital is going to survive and thrive no matter what the affiliation is.”

 

Secret for now

For now, the public is largely in the dark about the nature of the proposals, or even what type of affiliation WestCare and Haywood are willing to entertain. WestCare and Haywood won’t release the letters sent to Mission, Carolinas and Novant inviting them to make a pitch — which would likely shed light on exactly what the home hospitals hope to get out of the deal.

They also won’t make public the proposals that came back from Mission and Carolinas. Carolinas and Mission don’t want their private business information shared, and might not have sent proposals if they thought they would be made public, Poore and Leonard said.

“Although we are bound by confidentiality agreements to not give out details of the proposals, we will continue to let the community know about the evaluation process and where we are in it,” Leonard said.

The process is fraught with complexity, with each entity forced to share inside details of their operations to accurately size each other up, but wishing they didn’t have to. While Haywood and WestCare shared information with Carolinas and Mission so they could craft their pitches, it’s not being swapped with each other. For now, the two are still technically competitors.

Another factor in play is anti-trust laws. If Haywood and WestCare joined, especially with Mission, they could be subject to anti-trust regulations.

“We are trying to deal with a pretty complicated situation. There are a lot of moving parts,” Poore said. “We have been very forthright — as much as we can — during the whole process.”

Many in the medical community have expressed concern over an affiliation with Mission, fearing it would steal local specialists and siphon the most profitable operations away to the flagship in Asheville. Mission has insisted it wouldn’t do that, and they are still considered in the running.

“It will be premature to say one organization has a lead over the other at this point,” Leonard said. Besides, the decision rests in the hands of WestCare’s and Haywood’s hospital boards, he said. They likely have a long way to go before reaching a final decision.

Depending on the arrangement, Haywood Regional Medical Center could face an added layer of scrutiny, and a significant one at that. If the arrangement takes the form of merger or long-term lease, final approval rests with county commissioners.

Haywood Regional is a public hospital, and state statute gives final authority to the county’s elected leaders rather than the appointed hospital board. The statute also requires all proposals for an affiliation — not just the one the hospital says it wants — to be made public so county residents can see for themselves the options on the table. It also requires two formal public hearings to provide for public input.

Poore said once the hospital gets further along with its own decision, it will begin following the state statute requiring public involvement.

 

Why affiliate?

Health care conglomerates, often organized under one flagship hospital, are increasingly common. On the other hand, rural hospitals flying solo are increasingly rare.

“The growing demands of providing healthcare have jeopardized the mission of small rural hospitals,” said WestCare CEO Mark Leonard.

Smaller hospitals are struggling to stay relevant in the rapidly changing world of health care. Doctors are more specialized, while equipment is more sophisticated and expensive. Theoretically, a larger patient base — achieved by pooling patients from more than one county — can justify the cost of providing the service. Those who don’t band together but opt to compete can end up unable to provide an advanced level of health care.

The economy has exacerbated the challenges, as more patients fail to pay their medical bills or turn to the emergency room for basic treatment, Leonard said.

Page 6 of 11

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