Four firms are likely to emerge as finalists to study OCH Regional Medical Center’s finances and future outlook, but hospital Chief Executive Officer Richard Hilton said the shortlist should be narrowed to three because of a perceived conflict with one of the applicants.
Consultant Frederick Woodrell is likely to recommend supervisors interview representatives from BKD CPAs and Advisors, Healthcare Management Partners, Horne CPAs and Business Advisors, and Stroudwater after nine firms submitted proposals earlier this month.
Supervisors could schedule interviews with firm representatives in a special session in the next two weeks. An agenda for Monday’s meeting is expected to be published today, and supervisors also slated a public budget work session at 9 a.m. on Wednesday.
Hilton confirmed the shortlist with The Dispatch but said external factors should exclude Healthcare Management Partners. He declined to comment about the specifics of those issues.
At Gov. Phil Bryant’s request, Healthcare Management Partners led April’s Mississippi Rural Healthcare Summit and co-authored “Understanding the Current Status of Mississippi’s Government-Owned Community Hospitals,” a white paper cited through the event.
During previous discussions leading to the Oktibbeha County initiating a hospital study — the first step required by law before a sale or lease of the government-owned facility can occur — supervisors leaned heavily on the report and said Bryant emphasized the need to study public health care’s strengths and weaknesses for the future.
Consultant: All firms are qualified
Woodrell said all four firms are qualified to perform the study as outlined in the county’s request for proposals.
“I don’t personally believe (co-authoring the report should disqualify Healthcare Management Partners), but the board may choose to do so. They will hear those comments and considerations as they move forward and decide what is in the best interest of the community,” he said. “We’re still in the process of identifying the finalists. They all have a good reputation and the capability of handling the study. Their proposals are in line with what we requested.”
Horne’s proposal is the cheapest of the nine submissions. The firm’s baseline cost is projected at $35,000, but a “value-added option” to “explore strategic partnerships to discover superior value to the market” would add an additional $17,500 to the final bill.
BKD’s feasibility study’s price tag is $37,500, plus any travel costs and a 4 percent administrative fee to cover paperwork and other physical costs. Its proposal states the fees may increase if duties or responsibilities change.
Stroudwater’s proposal is listed at $45,000-$50,000, but not to exceed the $50,000 mark.
Healthcare Management Partners’ study cost was estimated at about $64,805, but the firm applied a 20 percent discount and then capped the total cost at $50,000. That cap, its submission states, does not include legal and other out-of-pocket expenses.
All nine proposals are available for review at Oktibbehacountyms.org/?q=node/80.
A ‘level playing field’
Supervisors are not required by law to accept the lowest bid and can opt instead for what they deem are the best services at the most advantageous rate.
Hilton said he felt both Horne and BKD are qualified to handle OCH’s financial examination, and he is familiar with both groups’ work.
“Stroudwater … I don’t personally have anything against them, other than they’re offering to do things outside statutory requirements (for a hospital analysis). Strategic planning is something that falls back on the hospital, and I don’t think there’s a need for the group to handle that,” he said. “It’s also hard to gauge Healthcare Management Partner’s proposal because they have open-ended, undefined services with no set cost cap. You don’t know what the total costs are.”
District 4 Supervisor Bricklee Miller said the four firms best match the scope of the study, each bringing “unique skills and methodologies to an engagement.”
She declined to discuss the individual firms’ strengths, weaknesses and perceived conflicts so they “all … come in on a level playing field.”
“All questions should be addressed in a public forum by the consultant to determine validity and concerns before the board makes a decision,” Miller said. “A public meeting will be organized to hear from each group to address any concerns.”
Woodrell previously told supervisors in an email that “at this point, it is not unusual for many interested parties to try to gain advantage by soliciting information directly from you” and for board members to refer those solicitations to him “so we may have one (consistent) response.”
After interviews and public forums are conducted and a finalist is selected, the county is expected to resolve any contract issues and begin the engagement.
A long political process
Supervisors unanimously voted in June to conduct a hospital analysis.
State law requires a study conduct, at minimum, certain reviews, like the community’s in-patient facility needs, the area market’s needs for services, hospital strengths relative to competition and its options, including service mixture and pricing strategy.
Woodrell added two other deliverables to the study: a quality care comparison of the hospital’s performance with state, regional and national benchmarks and recommendations of possible actions moving forward.
Supervisors previously stressed the importance for OCH and the county to work together during the process.
A once-quiet issue, the future of OCH again became a talking point this year when District 2 Supervisor Orlando Trainer renewed a previous push to study the hospital and determine its long-term viability.
Hospital trustees questioned Trainer’s motives, vouched for their own yearly audits and said continuing to place doubt over OCH’s future affects recruitment and retention efforts.
Statewide and national trends in declining hospital bed occupancy and increasing operational mergers are forcing communities to study their publicly owned health care facilities, Miller said in May, and supervisors would be naive to think those trends will not affect Oktibbeha County in the future.
“Nine out of 10 hospitals in the country are evaluating some form of partnership or alignment, and 87 percent of hospitals across the country to pursue alignment with another hospital or health care system,” she said while citing statistics released in the Healthcare Management Partners-co-authored report from April’s summit. “(Summit speakers) stressed the need for hospitals to evaluate, adapt and change to ensure long-term health care for communities. Our hospital is a vital part of our community, and we want to ensure quality, long-term health care.”
At a joint meeting with OCH trustees and supervisors in May, Hilton said he was not afraid of opening the books for an outside assessment.
“Year after year, there does not need to be this continuous thing of whether or not we’re going to sell or lease the hospital,” he said at that meeting. “That decision, at some point in time, has got to come to a close.”
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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