County reclaims hospital after operator defaults on lease

PORT GIBSON — Claiborne County supervisors have taken back the local hospital after the former operator missed two years’ of lease payments.

The board voted to retake the facility from Tupelo-based Rural Healthcare Developers, the Vicksburg Post reports.

County administrator James Johnson said business continues as usual. The 25-bed facility is now called Claiborne County Hospital, instead of Patients’ Choice Hospital.

Rural Healthcare Developers owes the county about $869,000, Johnson said. The company, which leased the facility in 2008, has been behind on its lease since August 2010.

The county has hired Jefferson County Hospital CEO Jerry Kennedy to consult. Johnson said supervisors could hire a management company or lease the hospital again.

Rural Healthcare Developers chief Ray Shoemaker was found guilty March 2 on federal charges related to kickbacks, bribery and embezzlement while an executive at Tri-Lakes Medical Center in Batesville. Shoemaker denies the charges, which include stealing $250,000, and has vowed to appeal the conviction. He has not yet been sentenced.

In addition to retaining Kennedy, board actions last week included taking out property insurance and obtaining a restraining order against RHC.

Claiborne County Sheriff Marvin Lucas said his deputies assisted with making sure computers and other equipment were not removed from the building.

“The current pay period is expected to be the responsibility of Rural Healthcare Developers,” Johnson said, saying the hospital employs the equivalent of 100 full-time workers. “With the county taking it forward, the assumption is the county is going to look at developing a plan of action, with the assistance of a consultant, to pay them.”

The hospital’s license has not yet been transferred, and during what is expected to be a two-week transition, RHD staff is continuing to provide some assistance, Johnson said.

“They are cooperating to an extent,” he said. “They are also making arrangements to transfer out of the hospital.”

Rural Healthcare Developers has renamed itself as Team Health and elected Dr. Carol Harris, a Lena physician, as president. The Northeast Mississippi Daily Journal reports Shoemaker transferred his shares in the company to Harris, Tupelo minister Elston Charles Kemp and Georgia businessman Curtis Sanders. Kemp is now vice president of the company and Sanders is secretary and treasurer.

The company also owns a Belzoni hospital and runs a senior health program in Smith County. It is selling a hospital in Erin, Tenn.

Hinds County Circuit Judge Winston Kidd granted a temporary order continuing state Medicaid payments to the Port Gibson and Belzoni Hospitals.

The state tried to end payments because the hospitals did not get approval to change owners. The hospitals told Kidd they would close by late July without Medicaid money.

It’s not clear if federal prosecutors will object to the transactions. Shoemaker could be ordered to forfeit assets when he is sentenced.

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