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Fallout from funding crisis still unfolding

The future of Haywood Regional Medical Center could be in jeopardy following the termination of the hospital’s Medicare and Medicaid status due to violations uncovered by health care inspectors.

Medicare and Medicaid account for 68 percent of the hospital’s revenue. Without it, the hospital cannot afford to operate. It will be at least one month, and possibly four, before the hospital can get its Medicare status restored.

As of press time Tuesday, much was still unclear about what the future would hold. While the hospital has reserves to the tune of $20 million, those won’t last long with such a drastic cut to its revenue. The hospital is continuing to provide health care to Medicare and Medicaid patients who land in the hospital with emergencies and cannot be transported safely to a neighboring hospital, but the hospital will not be reimbursed for treating those patients.

In addition to the financial straits the hospital is facing, doctors, too, face a potentially devastating loss of income. HRMC spokesperson Robin Tindall-Taylor says at this time there are no plans for any layoffs, though some in the medical community have raised the issue privately. With more than 900 employees, the hospital is Haywood County’s second largest employer.

Another possible fate: the hospital could be sold or enter into an operating agreement with another hospital. It is a discussion that will likely arise in earnest as the hospital board contemplates how to keep the hospital viable. Such a sale would ultimately have to be approved by the county commissioners, a final ounce of control left over from the days when it was a county hospital.

“At this point, the hospital board will meet later this week to chart a course of action,” said interim CEO Al Byers. “Our primary goal is taking care of the sick in this community and working internally to get our Medicare and Medicaid certification back.”

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The hardship posed for Medicare and Medicaid patients — the sick and elderly who will be transported to neighboring counties for health care — will touch thousands of lives. Women on Medicare and Medicaid in need of a mammogram will now have to go elsewhere and might put off the life-saving screenings. Elderly patients on extended hospital care will be transported to neighboring hospitals, making it more difficult for their loved ones to visit them.

Dr. Henry Nathan said the crisis the hospital is facing is immense, one of the worst any hospital could encounter.

“It breaks our heart that this is happening,” said Nathan, speaking collectively for the medical community.

The repercussions are so numerous that new ones continue to emerge almost hourly.

“I am concerned in the short term about people who count on their pay check at the hospital,” Nathan said.

It will be a long struggle for the hospital to pull itself back together after the screeching halt it will soon face.

“They will look for jobs elsewhere, and when the hospital gets their Medicare back it will be hard to find people to come back to work. It will be a setback to recuperate from this,” said Nathan.

The stigma also won’t be good for the long-term future of the county’s medical community.

“When this is all settled a year from now when you are trying to recruit doctors, if they get wind of what happened it makes them a little more skittish about making a commitment to come here,” Nathan said.


What do doctors do?

An emergency meeting for all doctors in the county was held Monday night (Feb. 25). There were dozens of questions from doctors who were unclear what to tell patients and whether they could still perform work at the hospital.

Doctors and the hospital administration on one thing — if a Medicare or Medicaid patient shows up at the hospital with an emergency, they would provide whatever health care is necessary even though they won’t be reimbursed for it.

“We are committed as a medical staff to make sure our patients are taken care of,” said Shannon Hunter, chief of the medical staff.

Doctors were eager to know what they should do in varying degrees of an emergency, however.

“It’s always a medical decision first,” said Byers, acting CEO.

Dr. Robin Matthews, an ob-gyn, said if she believes a Medicaid patient who is in labor needs surgery, she will want to send them to surgery right then — not have them transferred to another hospital.

“So be it,” Byers said. “We’ll have to eat it.”

Doctors were not clear on the litmus test that should be applied to Medicare and Medicaid patients when deciding whether to treat them versus sending them to another hospital. It’s especially tricky when a patient has been examined and stabilized in the ER but needs more complex treatment. Dr. Jeffery Chain, an orthopedist, said his practice undoubtedly gets a call from the ER every shift to come down and set broken bones. What should they tell the ER doctors, that they are on their way or send the patient elsewhere?.

“We have to know what to do when the ER doc calls us on the telephone,” Chain said.

“Ideally, if it is a Medicare or Medicaid patient, ship it,” Byers said. “Refer if possible.”

The hospital can absorb the cost of treating Medicare and Medicaid patients without being reimbursed for a while, but doctors should use that sparingly, said David Rice, who resigned as CEO in the wake of the crisis.

“We have significant reserves, but it can be depleted very fast if we have an increase in patients without any coverage,” Rice said. “It would behoove the medical staff not to run these patients through the system because it could deplete those reserves very quickly.”

Rice said the hospital has $20 million in reserves, a “war chest” built from nothing when Rice came to the hospital 15 years ago.


Physicians caught in the middle

How the crisis will affect doctors ranges widely. Family doctors who rely very little on the hospital for their livelihood will be affected very little. But for most doctors, it’s quite the opposite. Medicare patients are their bread and butter, literally.

“It is a huge deal. We can’t function,” said Dr. David Markoff, an ophthalmologist who uses the hospital to perform eye surgeries. Markoff had to cancel eight of his nine surgeries on Monday because they were Medicare patients.

Luckily, neighboring hospitals have agreed to let doctors from Haywood Regional use their operating rooms.

WestCare is working quickly to credential doctors to perform surgeries at Harris Regional Hospital in Sylva.

“A number of the physicians have contacted us to ask if there was anyway in which we could help their patients in their community during this emergency situation,” said Mark Leonard, CEO of WestCare. By next week, Haywood County doctors should be lined up to perform everything from colonoscopies to cataract surgery for their patients using facilities at Harris.

That will allow doctors to continue performing colonoscopies, knee surgeries, hip replacements, cataract removal — all sorts of elective surgeries — for their Medicare patients as long as the patient is willing to travel out of county. Haywood Regional will lose money, but those doctors can continue to maintain their practices and pay their employees.

Of course, that only holds true for elective surgeries. Some doctors rely largely on the patients who simply show up on the hospital’s doorstep for emergency care. If Medicare and Medicaid patients are sent elsewhere, those doctors will see a drastic reduction in their work.

When a Medicare patient shows up at the hospital with a broken ankle, for example, and is sent to another hospital instead, a host of doctors will miss out on income. The orthopedist who would normally set the bone misses out. The anesthesiologist who would provide pain medication misses out. The radiologist who would perform the X-ray misses out.

Anesthesiologists could have the most to lose. Not only will they see a drastic reduction in walk-in patients, but they will miss out on the elective surgeries as well since doctors will be performing those at other hospitals and will use the anesthesiologists affiliated with that hospital.

Dr. Basil Pugh, an anesthesiologist, saw half of his workload canceled Monday — the first day without Medicare. Instead of the 24 surgeries that were planned, only 12 occurred.

During the physician meeting Monday, one asked how he was supposed to live without any income if this lasted for three or four months.

Nathan said the looming financial hardship is more frightening for young doctors just out of medical school with loans to pay back and careers yet to build.

“The new physicians that are trying to build up a practice and have a big mortgage on a home they just built in Haywood County are the ones I worry about more than the ones who have been here for years, have their house paid off, have their kids through college,” Nathan said.



Labor and delivery faces one of the more complex problems in the hospital. Pregnant women who have been seeing one doctor for nine months will not be eager to get a new doctor at another hospital just before their delivery. And when a woman does go into labor, there is not always time to send them down the road to another hospital.

“When they come in in labor, you can’t send them somewhere else,” said Dr. Chris Lane, a doctor at Haywood Women’s Medical Center.

Roughly 70 percent of the pregnant women in Haywood County are on Medicaid, the federal health care program for the low-income. It is a huge percentage. Haywood Women’s Medical Center and the hospital are continuing to see Medicaid patients locally and will deliver their babies, but it is unclear how long that can be sustained before the hospital would no longer be able to subsidize the births out of its own pocket.

Dr. Robin Matthews questions whether she could be liable if she sent a laboring woman to another hospital and she didn’t make it there in time.

“To me that would be abandonment of a patient, and I am not going to risk that,” Matthews said. Matthews said her practice would continue delivering the babies of women on Medicaid at Haywood Regional as long as the hospital lets them continue — even if it means they’ll never get paid.


Urgent Care

The Medicare crisis also affects Urgent Care, which is an arm of the hospital. Urgent Care is currently getting swamped with flu patients, many of them on Medicare. Dr. Shannonr Hunter, the hospital chief of staff, urged family doctors to do what they could to keep patients out of Urgent Care.

“We are asking you to step up to the plate, work through lunch, do what you can to see these patients,” Hunter said. “We want to stress early treatment and preventative care so they don’t end up in Urgent Care.”

For Medicare and Medicaid patients who are already in the hospital, there is a 30-day grace period before Medicare will stop paying. Hunter told doctors they need to get those patients transferred to other hospitals before the 30 days runs out.

“We need thoughtful consideration of that. A lot of neighboring facilities are going to be near capacity. Please work on that sooner so we are not traumatizing the hospitals that are trying to help us out. We don’t need to all be working on that at the last minute,” Hunter said.


Insurance not insulated

While the crisis only applies to Medicare and Medicaid patients, the hospital could lose the business of privately insured patients who garner a negative impression of Haywood Regional from the onslaught of media coverage. That in turn could cause a further loss in revenue for both doctors and the hospital.

Doctors also have to think twice about admitting any patient to the hospital.

Doctors who admit non-Medicare patients to the hospital could be putting themselves at greater risk for malpractice lawsuits, warned Phil Smith, the hospital attorney. It could provide just the fodder a malpractice lawyer needs.

“If you are admitting patients to a facility that has just lost its Medicare license, the plaintiff’s lawyers will look at that as an opportunity,” Smith said. “Your liability risk could go up.”

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