Update from top leaders of Madera Community Hospital: They seek an operator to reopen for care | Commentary

We need to begin by saying thank you to those who have stood by us in a very difficult time. We especially want to acknowledge the hard work of our staff, nurses, physicians, community, neighboring counties, health-care partners and elected representatives. Your ongoing efforts to work with us and find a solution are appreciated.

Madera Community Hospital has served our community for 51 years and had always been financially stable until the pandemic put us over the edge. It put the hospital’s budget into a downward spiral and there was no coming out. Additional state and federal funding resources to fight COVID only helped for a short time. More funding was promised, but never came. The additional costs of contract nursing staff, supplies and medications were financial stressors that remained and were compounded by some of the lowest Medi-Cal reimbursement rates in the state. For the first time in 49 years, Madera Community needed assistance.

Our CEO reached out to Madera County, the city of Madera, California Hospital Association, Congressman Jim Costa, state Sen. Caballero, Assemblymen Adam Gray and Frank Bigelow, and California Secretary of Health and Human Services, Dr. Mark Ghaly. The state supplied nurses for a short period. Eventually we had to reach out to the city and county to appraise them of our hospital’s financial situation and concerns about our ability to remain open without additional assistance. The county subsequently allocated $1 million of their COVID American Rescue Plan funds to MCH.

We began in earnest looking for a health-care partner and found St. Agnes/Trinity Health. Both parties were optimistic an affiliation would move forward quickly as MCH had already began discussions with Attorney General Rob Bonta.

In the affiliation agreement, Trinity agreed to loan MCH $15 million so we could remain open. Of that, $6.3 went to pay off MCHs only existing debt for necessary hospital repairs to its ventilation system; the remainder was used for additional repairs, operations and gap money to get through the affiliation process. Negotiations took much longer than anticipated. After 15 months Trinity chose not to go forward because of the attorney general’s conditions. This left MCH with no other option but to face closure.

Madera Community executive staff continued to exhaust all avenues for additional funding, including attempting to get Medi-Cal plans to make early payments of money owed. Elected officials were appraised of the severity of the situation and impending closure.

While we have a long road ahead, we are currently following three concurrent paths to reopen:

A first path is to see if Chapter 11 can be avoided by convincing the state that reimbursement rates for Medi-Cal patient care are too low. For MCH to serve our community as an acute-care facility, our rates should be on par with at least neighboring counties. We hope our elected representatives and public will assist us in advocating for fair, equitable reimbursement. For rural communities such as Madera County, where reimbursement rates are some of the lowest in the state, it is impossible for a hospital to function independently.

A second path, the one we are on now, is making extensive efforts to identify potential suitors with an interest in operating MCH. We will continue to ask for assistance from local, state and federal funding resources at this time to maintain our assets so the viability of this option is not weakened. Keeping minimal staff in place to maintain basic operations, accounting for money owed and to preserve the integrity of the MCH campus is absolutely necessary for this to be feasible. This effort will continue both before and after a Chapter 11 case is filed.

The third path is what will happen if after a rigorous search there are no suitors. Then, and only then, will MCH look at liquidating assets to pay its creditors. This is a last resort. However, those efforts to maintain the facilities will continue until all options are exhausted and we must liquidate.

As the result of a perfect storm, we were forced to close a hospital that provided essential services for 160,000 residents. The pandemic was not permanent, but the impacts continue. We will not give up. Our community needs a hospital and we must all work together to find a solution.