Jackson Hospital Board Votes Unanimously Not to Sell
Jackson Hospital’s governing board voted not to sell or lease the hospital in response to Florida State Statute (FSS) 155.40. CEO Larry Meese stated, “After consideration of the report of valuation and after deliberations, the Board of Jackson Hospital determined that it is not in the best interests of the residents of the district to sell or lease the assets of Jackson Hospital.” Board Chairman Holt Floyd stated, “It is great to put this legislative mandate behind us, so that we can continue to focus on providing quality care to the citizens of Jackson County.”
FSS 155.40 states that, the sale or lease of a county, district, or municipal hospital can occur if it is in the best interests of the citizens of the hospital district. In 2012, the Florida legislature passed the law, to ensure the sale of public hospitals is conducted at fair market value and complies with all state and federal antitrust laws.
The law also states that hospitals have to conduct a fair market valuation, an operational assessment, a public hearing, and that the governing board votes to maintain ownership or to sell or lease its hospital. The legislative mandate also stated hospitals are responsible for paying for the costs associated with the mandate—approximately $30,000 for Jackson Hospital.
Jackson Hospital conducted all of the mandates of the law over the winter and spring. The Board voted during their regularly scheduled monthly meeting in May to keep the Hospital under local control. The decision to sell or lease a hospital as stated in statute 155.40 is determined by the governing board of that hospital.
In response to the statute, Jackson Hospital had an independent company, Principal Valuation, LLC, conduct the valuation and operational assessment. The focus of the operational assessment was to consider an objective operating comparison between Jackson Hospital and other hospitals with similar payer and service mixes. The analysis was constructed from various public sources of information including the Agency for Health Care Administration and the Centers for Medicare and Medicaid Services. The comparison considered both operational indicators and quality of care measures.
The report’s operating measures included an analysis of financial and utilization data. “We are pleased to find out that Jackson Hospital’s operating costs are the lowest out of all the hospitals we were measured against,” stated Floyd. Floyd continued, “The operational assessment affirms what the citizens of Jackson County already know, that Jackson Hospital is being well run. We are proud of the changes we have made over the last several years to improve the quality of care to the community.”
CEO Meese stated, “Even with a challenging payer mix Jackson Hospital is trying to keep costs low for its patients. We receive no tax support from the city, county, or state. Therefore, we have to manage our resources effectively to be successful in today’s challenging healthcare landscape.”
Jackson Hospital achieved several remarkable results on the quality of care measures evaluation. The Hospital received a score of 100 percent for the heart attack or chest pain aggregate quality of care score. Chief Nursing Officer, Robbin Catt, explained, “We are proud that we are treating our patients as well as or better than other hospitals if you have chest pain.”
Jackson Hospital was the second best hospital in the independent analysis for preventing hospital acquired conditions and its prevention rate is also better than the national average. The comparative analysis data for the quality of care measures were taken from the Hospital Compare section on Medicare’s website.
Using three different valuation methods, Principal Valuation stated that the fair market value of Jackson Hospital is between $18 and $28 million. The firm also noted that selling the hospital to a for-profit system would result in $3.7 million loss in economic value to the community. This loss in community value is based on all of the public services provided by Jackson Hospital that would not be provided by a for-profit hospital.
Principal Valuation informed the Board of Trustees that the Hospital is well managed. The independent firm also noted that the Hospital’s rural setting and challenging payer mix, coupled with the good management, would make the market for potential buyers smaller.
The Jackson Hospital Board held a public hearing in early May, and a crowded room of concerned Jackson county citizens attended. The Board heard all that wanted to voice their opinion. Everyone that spoke made it clear to the Board that they wanted the Hospital to remain under local control and to not sell the hospital. Board Chairman Floyd stated, “It was great to see the community support their hospital unanimously.”