OKTIBBEHA COUNTY — County supervisors have taken the next step to explore selling or leasing out OCH Regional Medical Center.
A few minutes into Monday’s supervisors meeting, the board went into executive session to discuss a feasibility study on the hospital it commissioned in April from Raymond James Financial Services. When supervisors came out of executive session, they voted unanimously to set a public hearing for Sept. 19 on the sale of the hospital. The hearing is set for 5:30 p.m. in the chancery courthouse.
“Once we pass the resolution to move forward with exploring the sale of the hospital, the statute says we have to schedule a public hearing and let the public know what our intentions are,” Board President and District 3 Supervisor Marvell Howard told The Dispatch Tuesday.
The study — which has since been made available on the county’s website — includes information on the hospital’s income, debt profile, capital spending, utilization, nursing staff and retention, revenue leakage and more.
According to the study, the hospital’s total operating revenue grew from $64.2 million to $69.1 million between 2020 to 2023. In the past year, the hospital had an operating revenue of $79.7 million, the study found.
But the study attributes the increase to additional Medicaid Mississippi Hospital Access Payments the hospital has been receiving, which have increased by $7,224,512 or 232.8% over the past five years.
The study says these supplemental payments have created a positive operating margin for the first time in recent history, but without them, OCH’s operating margin would turn negative. The study also says it is “unclear” if the elevated MHAP payments will continue after Fiscal Year 2025.
The Raymond James report recommends OCH find a “strategic capital partner” to ensure it has access to resources to expand its services and fund current and future capital needs. That would be best achieved with a sale or lease, it indicates.
Howard said he voted to proceed with the public hearing exploring the sale strictly based on the data presented to him. He said the report showed the challenges OCH is facing, but it also identified some “bright spots.”
“When we entered this process, I was just going to let the data lead me, and just wait to see what the data says and see what the projections were and things like that,” Howard said. “That’s what led me to cast my vote to let us move forward with exploring the possible sale of the hospital.”
District 1 Supervisor Ben Carver told The Dispatch that taking on a partner may help to strengthen the hospital financially, along with taking out some of the risk for taxpayers.
“A hospital will always be there … but a standalone hospital might be a thing of the past,” Carver said. “We’re seeing if we can still sustain the top quality health care with the taxpayers taking all the risks on and all the volatility of the market.”
Carver also mentioned the report showing issues with staffing nurses and doctors for the hospital. As of Sept. 30, 2023, OCH had 131 physicians as a part of its licensed medical staff, with 35 as primary admitting medical staff.
District 2 Supervisor Orlando Trainer said other concerns from the presentation included revenue leakage, as patients choose to leave the county to go to other hospitals.
The study shows the hospital’s Medicare revenue leakage with its top five competitors, but attributes just under 50% of that leakage to Baptist Memorial Hospital-Golden Triangle and Baptist Memorial Hospital-Memphis. Trainer attributed this leakage to other hospitals offering services that OCH cannot.
“If OCH doesn’t offer those services, you’ve got to go where the services are offered,” Trainer said. “But if there is a possibility for us to offer those services here, and keep that money here locally, then that would be a win-win for everybody in the county.”
Trainer also supported selling OCH in 2017, before voters rejected that measure at the polls. After the election, OCH opted to affiliate with University of Mississippi Medical Center to expand its services and enhance its medical staff.
However, Jackson said in July he didn’t believe OCH had greatly benefited from the affiliation. The study also shows that the affiliation has not eliminated material revenue leakage from OCH to UMMC.
“OCH Regional Medical Center has been a cornerstone of health care in our community for decades, providing compassionate and top-tier medical care to our friends and neighbors,” Jackson told The Dispatch in a text message Tuesday. “While the Board of Supervisors has made the decision to move forward with steps regarding the sale of OCH, our unwavering commitment to delivering exceptional care remains.
Regardless of the outcomes, we are dedicated to continuing our mission of serving the people of Starkville, Oktibbeha County and beyond with the same level of excellence and care that they have come to trust.”
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