Hospital outlook still unknown
Published 8:01 pm Tuesday, February 24, 2009
After struggling to make payroll last week, the doctors who own Troy Regional Medical Center are still looking for financial security.
“We don’t really have anything to report right now,” said John Crosby, chairman of the Doctors Group, which is the entity that owns Troy Regional Medical Center. “There are some developments underway, and we will hopefully have some really good news to report.”
But in the meantime, the doctors are still looking for ways to keep ownership in their names.
CEO Rusty Eldridge said the hospital made payroll after the doctors received a short-term loan late last week, and now they must take another if they want to continue operations repeating last week’s situation.
“They took a short-term loan for last week, and they’re doing everything they can to try to get adequate financing,” Eldridge said. “If not funded, then we’re going to have an ongoing cash flow issue.”
Based on projections, by the end of this budget year, the hospital is facing some $2.5 million in shortfalls without more financing.
But regardless of ownership, the city of Troy has promised that shortfall is not something they will allow to happen.
“The city has guaranteed there is going to be a hospital here,” Eldridge said.
In an agreement with the group last year, the city consented to take over the bonds by January if the doctors could not finance the loans themselves. In turn, they could lease the business back to the doctors or any other entity they choose.
That agreement has been deferred until at least March, but they could potentially be given the keys to the building any time before that.
“We’re encouraged that the Doctors Group were able to work through their cash flow issues last week and pay employees,” said Troy Mayor Jimmy Lunsford.
“We’re encouraged they are going to continue to be successful.”
The financial hardships come threefold to the hospital, Eldridge said, but what it really boils down to is an all-around suffering economy.
“Hospitals across the country are having tough times,” Eldridge said.
“It may be a sign of the economy hitting the health care industry faster than anticipated.”
But on top of those issues, Eldridge said the hospital locally has had their own to deal with, one being a tough start.
The doctors took ownership after the hospital nearly went bankrupt last May.
Eldridge said the business has been undercapitalized from the beginnings.
And also, business that is usually at its peak this time of year has dropped significantly.
“What has really caught everybody by surprise is we are not as busy as you would have expected,” Eldridge said.
Eldridge said he was unsure when the doctors would have a firmer grasp of their financial outlook, but all things will resume normally.