Walker County OKs $1 million loan to Hutcheson as hospital plans to sell its Battlefield Imaging shares

Walker County OKs $1 million loan to Hutcheson as hospital plans to sell its Battlefield Imaging shares

May 16th, 2014 by Rachel Sauls-Wright in Local Regional News

Hutcheson Medical Center in Fort Oglethorpe, Ga.

Hutcheson Medical Center in Fort Oglethorpe, Ga.

Photo by Doug Strickland /Times Free Press.

Hutcheson Medical Center officials are again asking for help paying the bills, but they're hoping it's the last time.

Walker County Sole Commissioner Bebe Heiskell approved a $1 million promissory note from the county's general fund to help finance the hospital's "working capital" at her commissioner's meeting Thursday.

Don Oliver, Walker County's attorney, said this loan is necessary to get the hospital through the next few weeks until it can sell its shares in Battlefield Imaging, which make up 51 percent. The group of physicians that owns the other 49 percent of shares is buying out Hutcheson for about $5.2 million.

"The Battlefield Imaging sale will be set up so the county will be reimbursed by wire transfer at the closing of those funds," Oliver said.

Neither Catoosa County nor Dade County lent money to the hospital this time even though it's backed by all three counties.

"I wouldn't do it if they weren't going to pay me back, because I couldn't afford to," said Heiskell.

According to Oliver and Hospital Authority Board member William Cook, the loan and the sale of Battlefield Imaging, which includes a two-year buy-back provision for Hutcheson, will help the hospital get through one last "hump" before it returns to financial stability.

"It's projected that that will take care of the cash flow needs through the end of this summer, at which point the projections show the expense and income lines crossing," said Oliver. "The biggest part of that is getting Medicaid debts that were left by the prior administration paid back. In June we're going from paying Medicare about $250,000 a month to about $80,000 a month."

Of the $12 million he said the hospital owed in overpayments to Medicare and Medicaid, $8 million has been paid back along with $2 million in interest.

"If we had that $10 million to use for cash flow instead of paying back the Medicare, we'd be in great shape and wouldn't be asking the county for help," Oliver said.

Contact staff writer Rachel Sauls-Wright at rsauls@timesfreepress.com or 423-757-6439.