Employees and others listen as officials announce a partnership between Erlanger Hospital and Hutcheson Medical Center Thursday during a press conference at Hutcheson.
Staff Photo by Angela Lewis/Chattanooga Times Free PressIn need of a lifeline, officials at Hutcheson Medical Center announced Thursday they have settled on Erlanger Health System as a partner to help ensure the community hospital’s survival.
But the structure of the proposed affiliation is far from settled. Officials said they don’t know what Hutcheson’s signs will read this time next year, let alone what form the strategic partnership will take.
“That’s all not defined at this stage,” Hutcheson President and CEO Charles Stewart said Thursday after a news conference announcing the partnership plans.
Hutcheson leaders have been looking for weeks for a partner that could help recruit doctors and bring patients back to the Fort Oglethorpe hospital. They considered proposals from Erlanger and Memorial Health Care System.
Hutcheson lost more than $7.3 million in fiscal year 2009, according to unaudited financial statements. The hospital’s loss in fiscal year 2010 was about the same, Stewart said.
At the news conference, Hutcheson Medical Center board Chairwoman Martha Attaway said Erlanger won out because of its mission to provide health care to the poor, as well as its financial stability and willingness to recruit and maintain physicians in Northwest Georgia.
Erlanger handles the bulk of the uncompensated care provided to poor and uninsured patients in the area each year and it receives federal disproportionate share payments to help offset those losses.
Hutcheson and Erlanger now intend to move forward with a 60-day “due diligence” period, giving each time to learn more about the other and come up with a detailed plan for collaboration by mid-January, Stewart said.
Members of the committee that heard Erlanger’s partnership proposal said the Chattanooga hospital, at least initially, would have operational control over Hutcheson.
“Like any business, if you’re fixing to drop a tremendous amount of money (into a partnership,) you want to have some control,” said Dade County Executive Ted Rumley, who heard the proposals and was one of the North Georgia county leaders who advised Hutcheson officials before the decision.
But it’s not clear what kind of financial exchange will occur between the hospitals.
After the news conference, Erlanger President and CEO Jim Brexler emphasized that the collaboration will be based on business strategy and clinical partnerships, not a financial bailout of struggling Hutcheson.
“The hardest part of this work is to [come up with] something that’s sustainable. A bailout isn’t sustainable,” he said.
Brexler also said a commitment to Hutcheson won’t be a drain on Erlanger’s operations in Chattanooga.
“We’re very clear that nothing we do here [at Hutcheson] will put in jeopardy the mission that we’ve got already [at Erlanger],” Brexler said. “This is about building a strong business plan for Hutcheson. This has been a successful organization in the past and there’s no reason why it shouldn’t in the future.”
Contact Emily Bregel at ebregel@timesfreepress.com or 423-757-6467.