Greenwood Leflore Hospital, long at the center of Mississippi’s rural health care financial crisis, is now scaling back services and laying off staff.
First reported by The Greenwood Commonwealth, the publicly-owned hospital announced last week that it is laying off 86 employees. It also immediately shuttered its after-hours clinic and wellness center and will close the cardiac rehabilitation and outpatient rehabilitation centers on May 1. Of the layoffs, more than half were full-time employees while the others were part-time staffers.
“Greenwood Leflore Hospital has been faced with recent financial challenges and has taken several actions to preserve the hospital’s ability to offer services,” a memo from the hospital reads.
The recent staff cuts and reductions of services highlight the drastic measures Greenwood Leflore Hospital has had to undergo to remain afloat as operational costs continue to outweigh revenue.
GLH, jointly owned by the city of Greenwood and Leflore County, is currently in a legal battle with Mississippi’s Division of Medicaid over its debts. The Division of Medicaid is seeking to recoup $5.5 million in overpayments that were given to GLH. To date, GLH has repaid $2 million of what it owes but has tried to avoid paying the remaining $2.5 million out of fears that doing so would shut the hospital down.
GLH is also reportedly in talks with the University of Mississippi Medical Center over a potential takeover. GLH administration has expressed interest in UMMC gaining full control of the healthcare facility’s operations and ownership of its facilities. The move follows 2022 talks between the two parties over UMMC potentially purchasing the hospital, though those discussions ultimately hit a dead end.
But now, with UMMC purportedly back at the negotiating table, GLH recently asked a federal court to halt all scheduled payments to the Division of Medicaid to not only avoid the hospital closing but also to protect its chances of being taken over by UMMC. The request was granted in March, as a federal judge ordered the Division of Medicaid not to collect any payments from GLH in the interim.
“GLH is also exploring options to lease, sell, or otherwise transfer the hospital to a larger healthcare system, which would allow GLH to continue to provide services to the people in its service area,” former GLH interim CEO Gary Marchand wrote in a March court filing. “GLH needs four to six months for negotiations to be completed. If successful, this would result in GLH being able to continue providing vital healthcare services to the people within GLH’s service area.
“The inherent value of GLH in these negotiations, however, is dependent upon the continued operations, including continued availability of the physicians, nurses, and clinical and administrative staff currently in place, as well as the ongoing maintenance of real property and equipment.”
State lawmakers eased the path this session for GLH to be taken over by UMMC. The legislature unanimously passed Senate Bill 3230, allowing GLH to file for bankruptcy to restructure its debts while maintaining operations. If negotiations with UMMC fail, the hospital risks closure by early summer, the Mississippi Free Press reported. The publication confirmed that the hospital will permanently close on June 15 if a solution to make it financially sustainable is not reached soon.
GLH’s financial crisis came to a head during the COVID-19 pandemic when all of its cash reserves were depleted. Covering uninsured patients who lacked resources to pay for healthcare services was a catalyst for the hospital’s economic peril. Officials at the time cited Medicaid expansion under the Affordable Care Act as a meaningful solution, one that would have allowed GLH to obtain more federal dollars for services, but efforts to expand Medicaid in Mississippi never came to fruition.
As things stand, the hospital has 425 employees on site to perform critical services. The 25-bed acute facility is still offering 24-hour emergency care, cardiology, orthopedics, oncology, and diagnostic imaging.
GLH has been in operation since 1906 and sits in a city with a population of approximately 14,000 residents, though the medical center assists patients from other parts of the Delta. If it were to close, the nearest hospital for residents would be roughly 35 miles away at UMMC’s Grenada campus.
