Hospital hearing scheduled
REDSTONE TWP. – A public hearing has been scheduled regarding the proposed sale of Brownsville General Hospital that would turn the community-based hospital into a for-profit hospital. “It’s going to be Dec. 14 at 1:30 at the Sons of Italy in Brownsville. The presiding officer will be Larry Palmer, who is an attorney with the Attorney General’s office in Pittsburgh,” said Mike Evans, the chief executive officer at Brownsville General Hospital. “Because this is a community asset, the Attorney General’s office is representing the community interest.”
The state Attorney General’s office staff did not return calls Friday.
The financially troubled hospital has been discussing the sale of the hospital with the Gosai-Gandhi medical group since early summer. The agreement has not yet been finalized, Evans said, and will need the approval of the Attorney General’s office and the Fayette County Orphans Court before it can be completed. The transfer of the hospital license must also be approved by the state Department of Health.
“We’ll be switching from non-profit to for-profit,” Evans said. “We’ll be taking the hospital and splitting it into two entities. The assets and liabilities, name, licenses and equipment will be sold to the Gosai-Gandhi group in a stock purchase agreement. The money will be used to pay down the vendors. They have been wonderful to us, at least during my tenure here.”
Evans said that the hospital owes its vendors about $1.5 million. He said the sale of the hospital should take that balance down to a reasonable level of approximately a 30-60 day balance that could then be maintained.
Evans said the hospital’s board of directors will continue to oversee the non-profit operations of the hospital.
“They will continue to hold the land and the grounds, which will be leased to the Gosai-Gandhi group,” Evans said.
Evans said that during the hearing the hospital will present its case as to why the sale should be permitted. It will have to show that it operated with due diligence to keep the hospital open by other means. The Gosai-Gandhi group will also then present its case as to why it should be permitted to purchase the hospital and will outline its plan of operation. Public comment will also be permitted.
Evans said the goal of the sale is to keep Brownsville General Hospital open as a full-service medical-surgical hospital to meet the needs of the community and to safeguard the jobs currently at the hospital.
Evans said that in the 16 months that he was been in charge at the hospital numerous measures have been taken to improve the hospital’s financial situation, but it just hasn’t been enough.
“As a result of everything we’ve done in the past year, we’ve had a positive cash flow and we’ve taken out bottom line loss of $2.5 million in 2003 to a bottom line loss in 2004 of $375,000,” Evans said.
Evans said the financial improvement has been due primarily because of cost cutting.
“You can’t use cost cutting as your sole strategy to improve your viability. You have to increase your profitability. The Gosai-Gandhi group gives us more patients and more income,” Evans said.
Evans said the Gosai group has nine or 10 physicians, with current offices in Charleroi, Carmichaels, Bentleyville and Waynesburg.