People living in and around Habersham County can look forward to healthier tomorrows and continued access to local hospital care for years to come, thanks to a decision reached Tuesday night for Habersham Medical Center (HMC) to officially join Northeast Georgia Health System (NGHS) in 2023.
“This is the best possible scenario for the future of Habersham Medical Center and the health of everyone in our community,” said Dolly Ritchie, chair of the Hospital Authority of Habersham County. “It’s a little earlier than originally planned, but it’s the right thing to do for all the right reasons.”
The Hospital Authority of Hall County & the City of Gainesville, the HospitalAuthority of Habersham County and Habersham County Government entered a five-year agreement to secure the future of HMC back in 2019. That agreement called for the Hospital Authority of Hall County & the City of Gainesville to invest $3 million per year – for a total of $15 million over five years – in capital improvements to enhance and expand HMC’s services. The first $3 million investment helped establish HMC’s Rehabilitation and Orthopedics Center. The second and third investments funded renovation of Habersham Home (HMC’s senior living facility). The fourth $3 million investment was just issued in November. The five-year agreement also included options for the Hospital Authority of Hall County & the City of Gainesville to assume ownership of HMC, in exchange for the total $15 million investment, at the end of the agreement in 2024 or earlier.
Tuesday, all three parties involved in the original agreement agreed to execute an early transition. The Hospital Authority of Hall County and the City of Gainesville will also provide the fifth and final $3 million investment on or before July 1, 2023. At that time, the Hospital Authority of Hall County & the City of Gainesville will immediately lease the hospital to NGHS or its affiliate.
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Also, on Tuesday, HMC and NGHS agreed to enter into a Management ServicesAgreement until the early acquisition date of July 1, 2023. Under this agreement, NGHS management will provide day-to-day oversight and review of critical functions and services as well as financial services and information technology (IT) services support, with regular updates to the Habersham Hospital Authority and Habersham County representatives.
The Habersham County Commission and the Hospital Authority of Habersham County also both voted Tuesday to increase an existing line of credit from $1.5 million to a new maximum of $6 million to help cover HMC’s necessary operating costs until the ownership transfer on July 1. The original $1.5 million line of credit the Commission approved last month has already been used to help HMC pay down a portion of outstanding debts. The additional $4.5 million added to the line of credit will be funded by local American Rescue Plan (ARP) funds originally intended to fund renovation of the Habersham County Airport’s hangar. Increasing the line of credit will not place any tax burden on the citizens of Habersham County.
“Stabilizing the long-term future for HMC and putting the hospital on a better financial path to grow is currently the most pressing need in our community, and this agreement accomplishes that – positioning HMC to become a vital hub for healthcare in this part of the state,” said Bruce Palmer, chair of the Habersham County Commission. “It’s a big win for our county and an increasingly rare positive outcome for a rural hospital at a time when at least eight rural hospitals have closed in Georgia during the past decade.”
“The challenges HMC has experienced in recent years mirror those of so many other independent, rural hospitals across the state and nation,” said Tyler Williams, president and CEO of HMC. “These challenges are only increasing, so the time to act is now. Our hospital joining NGHS – a well-respected organization, with a strong financial track record, who many people in our county already trust for their care – is going to stabilize and improve healthcare across the entire region.”
The latest reports from the Georgia Hospital Association estimate HMC’s local and state economic impact at $117 million, as compared to NGHS’ four hospitals having a combined impact of more than $3.5 billion. NGHS has also received “A” grades for its current finances, as well as “positive” outlooks for its financial future, from the national ratings agencies S&P and Fitch.
“There is clear data that shows a direct link between the economic health of a community and having a vibrant, local hospital and healthcare providers,” said Charlie Fiveash, executive director of the Habersham Economic Development Council. “Being connected to a rock-solid organization like NGHS will help beyond the bedside by attractingmore strong economic development in Habersham, which in turn brings in more tax revenue from businesses and lessens the tax burden on people who live in our communities.”
“NGHS is committed to make more long-term, multimillion dollar reinvestments in infrastructure improvements for HMC in the coming years – at no cost to the county or taxpayers,” said John Kueven, who is president of Northeast Georgia Medical Center Gainesville and has oversight of NGHS’ other hospitals in Lumpkin and Barrow counties.“Those reinvestments, like installing the same electronic health record we use at all other NGHS hospitals, are necessary to accomplish our shared vision to better coordinate care – so people can get most of their routine, specialty, and hospital care without leaving Habersham County.”
Both NGHS and HMC plan to work together with local physicians and the larger medical community across the region to seek input about how to align services to ensure long-term sustainability.
\“Our goal throughout these discussions, over many years, has always been to best serve the people of Habersham County by providing high-quality, local care they can trust,” says Carol Burrell, president and CEO of NGHS. “We should all be thankful for the Habersham County leaders and community supporters who worked diligently together to help save their local hospital, which will be the key to physical and economic wellbeing for generations to come.”
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