Still no word on West Georgia Health, WellStar deal
Published 12:00 am Tuesday, October 20, 2015
LaGRANGE — West Georgia Health’s trustee board met Monday for its monthly assembly, but took no action toward the potential merger with Marietta-based WellStar hospital system.
“We expect to reach a definitive agreement with WellStar within the next two to four weeks,” said Jan Nichols, a spokesperson for WGH. “Once that occurs, the agreement will be submitted to the (state) Attorney General’s office for official review, which can take 90 to 120 days and will include a public hearing held in Troup County.”
The hospital announced its intent to join with WellStar in May, and said the two hospital systems would enter a 90-day due-diligence review period. During the following months, WGH held a series of public forums explaining the process the two hospital systems would undergo as part of the deal. In short, WellStar would become the new manager of West Georgia Medical Center. The brick-and-mortar hospital is owned by the LaGrange-Troup County Hospital Authority, which currently leases the property to WGH. WellStar would become the new lessee under the proposal.
Further deals and specifics are expected in the near future.
In other matters, the hospital is up to date on payments toward the $46.6 million taxpayer-backed bond used to partially finance the construction of the new south tower. Currently, WGH has 132 days’, or about $63 million, cash on hand, according to a Sept. 30 financial narrative presented to the board. The figure includes both restricted and unrestricted cash.
“As you can see, we’re well within our bond covenants,” said board treasurer Speer Burdette. The hospital, under the bond agreement, is required to have at least 60 days’ cash on hand to prevent a taxpayer bailout. The 12-month average monthly operating expense for WGH was $475,301 in September.
The 132 days’ cash on hand is down slightly from a three month high of 137 days, and hospital officials attribute that to financial market declines. the hospital is heavily invested in the financial market. Still, the figure is up dramatically from a 12-month low of 108 days cash on hand in October 2014.
“We indeed have had a big financial turnaround in the last 18 months,” Nichols said. “We attribute that to a couple of primary factors: the efforts of all WGH staff and physicians pulling together to create efficiencies through expense reduction, enhanced group purchasing and the consolidation of care locations for staffing productivity, among other initiatives. The dollars we invested in the start up of our West Georgia Physicians group have begun paying off and returning money to the bottom line.”
Additionally, WGH CEO Jerry Fulks noted the new fiscal year for the hospital system will be nine months, rather than 12, due to the impending deal with WellStar. He asked the existing board officers to remain in their positions through the remaining nine months, and the board will take up that vote at its November meeting. Fulks also said trustee Kenneth McCamey is resigning from the board because of the work load.
In another matter, Fulks said the hospital is in line to receive a quality recognition award, but did not name any specifics.