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Scott, Citing ‘Very Serious’ Financial Problems, Wants Plan From Springfield Hospital



Valley News Staff Writer
Friday, January 04, 2019

Springfield, Vt. — Citing a “very serious” problem with finances at the organization that includes Springfield Hospital, Gov. Phil Scott is asking the health care system’s board to formulate and share a plan that would keep it from closing.

In a letter on Friday, Scott asked the Springfield Medical Care Systems Board of Trustees to issue a statement by the close of business on Wednesday of the organization’s overall financial health, to outline steps to avoid closing and to identify the leadership team that will implement them given the resignations of its CEO and CFO last month.

“If you share your plan and demonstrate you’re moving quickly to make corrections; and if you engage the workforce and the community, the health system’s patients and communities can have knowledge, confidence and peace of mind that you are doing the difficult, but necessary, work, while ensuring continuity of care,” Scott wrote in his letter.

Scott issued his letter following conversations with SMCS board Chairman George Lamb, Tenn.-based consulting firm Quorum Health Resources — which has been evaluating the health care system’s financial position since last month — as well as people in the community and state partners, Secretary of Human Services Al Gobeille said on Friday.

“Their cash position is truly critical,” Gobeille said.

Scott started his letter saying “the financial situation ... is very serious.”

The governor’s letter is intended to convey to SMCS’ board that state officials are concerned that the board is not demonstrating the “sense of urgency that the cash position would dictate,” said Gobeille, who said that the cash on hand would cover only “weeks” of expenses, not months. Springfield Hospital has an operating budget of approximately $60 million.

Scott’s letter comes following reports of SMCS — which includes the 25-bed Springfield Hospital, as well as health centers in Charlestown and the Vermont communities of Ludlow, Londonderry, Bellows Falls and Springfield — being behind in payments to vendors, low employee morale and a controversial change in the company providing coverage in the hospital’s emergency department.

The organization’s CEO Tim Ford and CFO Scott Whittemore departed within the span of about a week in early December. Since then, Chief of Practice Operations Josh Dufresne has been acting as the organization’s lead administrator.

The unexpected departures of the CEO and CFO meant that a good deal of institutional knowledge has been lost, Gobeille, a former chairman of the Green Mountain Care Board that is responsible for regulating hospitals, said.

“It is completely unusual,” he said.

In a Dec. 18 news release, SMCS officials said that the appointment of an interim chief executive officer and chief financial officer were “being finalized.” But, as of Friday afternoon, the organization had not yet issued an announcement of those appointments.

SMCS spokeswoman Anna Smith did not respond to requests for comment on Friday.

Scott, in his letter, also said that he has tasked Gobeille with working with the Vermont Association of Hospitals and Health Systems “to develop a continuity of care plan in the result care can no longer be provided through (SMCS’) current management structure.”

In the event that the hospital does run out of money, Gobeille said there needs to be a plan in place for what would happen to patients. He noted that SMCS operates a 10-bed inpatient psychiatric facility, The Windham Center, in Bellows Falls.

“(We) want the board and leadership of Springfield Medical Care System to be successful,” he said.

The state would like to support SMCS’ board in its plan to shore up the hospital, Gobeille said. There are things the state could do, such as making advance Medicaid payments, but it can’t do that until state officials see how that money would fit in with the a broader plan for the future, he said.

“We need to know more,” he said.

Earlier this week, former Rutland Regional Medical Center CEO Tom Huebner said a management contract with Quorum, and a memorandum of understanding with the state, outlining ways the state will help shore up SMCS for the immediate future, were expected to be finalized in coming days.

The highest priority at this point is to “make sure that citizens of the Springfield area are well served and get the health care that they need,” said Huebner, whom Scott appointed last month to monitor and assist SMCS officials.

In addition to continuing to assure quality care is provided to patients, Gobeille said the governor is focused on supporting the more than 750 employees of SMCS during this tumultuous time.

“They’re good people and they do good work and they didn’t make this happen,” Gobeille said.

Though officials now are focused on the immediate future, they subsequently hope to determine what lead to this situation and how it might be avoided elsewhere. Scott, in a letter last month, asked the GMCB to examine the financial health of all of Vermont’s critical access hospitals, which in the Upper Valley also include Gifford Medical Center in Randolph and Mt. Ascutney Hospital and Health Center in Windsor.

It’s “too early to point fingers,” Kevin Mullin, chairman of the Green Mountain Care Board, said earlier this week. “A much deeper dive is going to have to occur.”

One of the questions Mullin said he hoped such a dive would answer is how SMCS went from more than 100 days of cash on hand in August to not being able to pay its bills last month.

Until that deeper look takes place and the findings are made public, it is difficult to know what led SMCS to the difficulties it has been having in paying its bills and maintaining employee morale. This knowledge void, which SMCS officials have said they hope to address through an evaluation Quorum is currently undertaking, means that administrators of other hospitals aren’t yet sure what they might take away from the Springfield situation.

“I don’t think anybody really knows what was going on at Springfield,” Mt. Ascutney CEO Joseph Perras said on Friday. “It’s a bit of a black box right now.”

Perras would like to know what happened in Springfield so that he and others can learn from that experience.

Given the amount of data that all Vermont hospitals are required to provide to the GMCB, Perras said he finds it surprising that SMCS could end up in dire straits without the board’s knowledge.

“We send a vast amount of information to the Green Mountain Care Board every single month,” he said. “How could this have happened?”

Last month, Smith, the Springfield Hospital spokeswoman, said she expected Quorum’s review of SMCS’ finances would be complete and a report would be available by February or March.

Nora Doyle-Burr can be reached at ndoyleburr@vnews.com or 603-727-3213.