Hospital Can’t Meet Payroll

County Council Calls Emergency Meeting

WINNSBORO – The prognosis for the financial state of Fairfield Memorial Hospital, which for the last two years has been grim at best, has officially entered a critical phase. Tim Mitchell, the hospital’s Chief Financial Officer, told a joint meeting of Fairfield County Council and hospital board members Feb. 27 that unless the hospital can get its hands on at least $200,000 in cash before March 6, the hospital would not be able to meet its payroll requirements. Another $300,000 will be required to meet other pressing needs, including a list of vendors to which the hospital owes approximately $3 million.

Hospital CEO Mike Williams said the hospital was due approximately $400,000 in outstanding Medicare and other payments in February, but a pair of winter storms that shut down state government has delayed those payments, putting the hospital in a bind.

“The big check didn’t come,” Mitchell said, adding that the State Department of Health and Human Services has assured the hospital that the funds would be issued in the second week of March – too late for the hospital to pay its employees and other bills.

Mitchell said that over the next 45 days the hospital expected to see about $1.85 million in other payments come into their coffers, but the bulk of that would be used to meet other outstanding and late bills. After the hospital pays its licensing tax, pays into the state retirement system and makes its quarterly payment for service and support of the hospital’s computer billing system (for which they are $350,000 behind, he said), the hospital would only then be left with $47,000 to operate.

Mitchell and Williams told Council that the hospital was looking for a line of credit, either guaranteed by the County from a local bank, or from the County directly, in order the float the hospital for the next 90 days while negotiations get under way with a larger hospital to take over Fairfield Memorial.

“That places us in quite a predicament,” Interim County Administrator Milton Pope said, “because we would have to amend our budget. Transferring money from one entity to another would require three readings and a public hearing.”

And that process would take at least 21 days, well past the March 6 payroll deadline.

Council Chairman David Ferguson (District 5) said Council would hold an emergency meeting at 5 p.m. on March 6 to entertain the possibility of transferring the funds through a resolution instead of a budget amendment. Meanwhile, Councilman David Brown (District 7) urged the hospital board and administration to expedite the negotiation process and to open the process to more than one potential partner. The hospital, he said, always seemed to be 90 days from transitioning to a new partnership model, asking the County to help bridge the gap until a partnership can be established.

“When ya’ll are in dire straits for money, we get a phone call,” Brown said. “I’m starting to feel like the carrot being dangled out there is the 90 days. It’s always 90 days. I don’t want to keep coming back every 90 days.”

Hospital board Chairman James McGraw told Brown that this most recent request should not come as a surprise, as it was discussed during the last join meeting in January.

“I know,” Brown said, “but I would have felt a lot better if the report tonight would have been ‘We’ve got this package together and we’re moving forward,’ but it’s another 90 days. I’d like to see something in writing besides bills. I know it’s going to take more than 30 days, but I hope it doesn’t take more than 90 days or 120 days.”

At press time it was not known if the County would be able to pass the resolution transferring the $500,000. The Voice will update this story following the March 6 emergency meeting.