Progressive Health Group of Oxford, Mississippi, recently completed its $2.5 million purchase of the 127-bed Helena Regional Medical Center and its related physician clinics.
Progressive purchased the hospital from Quorum Health of Brentwood, Tennessee, and is under contract with the city of Helena-West Helena to buy the hospital’s land for $3 million, said Quentin Whitwell, CEO of Progressive Health Group LLC.
The Phillips County hospital has been renamed Progressive Health of Helena.
Whitwell told Arkansas Business that he plans to turn around a hospital that has been struggling financially for years.
In 2022, it lost $8.57 million on $12.75 million of net patient revenue. The hospital has reported at least a $1.3 million loss every year since 2004. It closed its labor and delivery unit in 2020.
“This won’t be the first hospital that we’ve taken that was losing $8 million a year and made it successful,” said Whitwell, who has been in the rural hospital business for about a dozen years.
He said that the hospital was expected to get its first Rural Emergency Hospital subsidy on Feb. 1.
The federal REH designation, created in 2021 to address concerns about rural hospital closures, comes with an additional 5% payment for Medicare patients for covered outpatient services. REH facilities also receive $272,866 a month, according to the federal Centers for Medicare & Medicaid Services. The payment will increase in 2024 and each year after.
The REH designation also means that the hospital will provide only outpatient and 24/7 emergency services and no longer accept inpatients, though it can still have patients spend the night under observation care.
Another part of the turnaround will be growing the hospital, Whitwell said. “We are in the process of converting the clinics to rural health clinics,” he said. “That will probably be the next step.” The hospital has three clinics.
With the RHC designation from CMS, providers receive higher reimbursement rates for services from government payers.
“And then we will add some extra ancillary services based on the needs of the community that we will assess,” Whitwell said.
He eventually wants to add surgical services back to the hospital. The hospital ended those services on Sept. 4, citing a shrinking population and “poor reimbursement” from Medicaid, the federal-state health care insurance program that helps pay for health care for the poor, and from other payers.
Whitwell said he first learned that the hospital might be for sale in the early fall. “Our phone usually doesn’t ring until the building’s on fire,” he said. When he toured the facilities, he noted that the hospital was in “excellent condition.”
And while the hospital has its challenges, the city’s community leaders are “positive and supportive, and that always goes a long way,” Whitwell said.
Progressive, which owns or manages 11 hospitals, has a corporate staff that will handle many of the backroom operations for the Helena hospital.
“Preserving the heartbeat of our local health care is of utmost importance,” Bob Moore, CEO of Helena Regional, said in a November news release that announced the proposed purchase. “By joining Progressive Health Group, we’re taking a significant step to help maintain access to health care for Helena and the communities we serve.”
The hospital has about 70 full-time employees and about 30 to 40 part-time workers.
Whitwell said he feels “very, very good about the prospects of this hospital being successful.
“We like the regulatory environment” of Arkansas, he said. “We like the people; we like just the whole overall opportunity in the state.”