Lee Regional Medical Center, a 70-bed hospital in Pennington Gap, Va., will close Oct. 1.
Wellmont Health System, which operates the hospital, announced the closing date this morning.
In a written announcement, hospital officials said that significant efforts were made by hospital administrators and the local board of directors to secure the hospital’s future, but due to unprecedented changes in health care they must close the facility.
The announcement listed three primary reasons that led to the decision: reimbursement cuts associated with the Affordable Care Act; extremely low community use of the hospital; and a lack of consistent physician coverage.
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Hospital officials said patients who need a broad spectrum of care will have seamless access to other Wellmont Health System facilities in the community and throughout the region. Wellmont Medical Associates will work with other community partners to assess what outpatient services are most needed and how those could be best served in the region.
“We had certainly hoped Lee Regional could remain open as a hospital and continue serving the community, but the difficult realities facing our facility are too much to overcome,” said Fred Pelle, the hospital’s interim president. “We remain committed to serving the health needs of people who live and work in Lee County and will assist them in whatever way possible in this transition.”
The closure is due in part to major cuts in Medicare reimbursements by the federal government associated with the Affordable Care Act and a lack of Medicaid expansion by the commonwealth of Virginia. Another factor is the additional 2 percent cut in Medicare reimbursements enacted because of the federal sequester.
More than 60 percent of the hospital’s payments comes from federal and state programs.
Through the American Hospital Association, hospitals across the country agreed to initial cuts in the reimbursements with the understanding Medicaid would be expanded to compensate for that lost revenue. But the U.S. Supreme Court’s ruling on the Affordable Care Act left it to the states to decide whether Medicaid should be expanded.
Virginia has put the issue in the hands of a commission consisting of delegates and senators but reached no conclusion. In the interim, the steep cuts have profoundly impacted the financial ability of hospitals in the region and across the country to survive.
“These political decisions clearly can have dire ramifications for small communities and the hospitals that serve them,” Denny DeNarvaez, Wellmont’s president and CEO said in the announcement. “For months, Wellmont and other health systems in the region and across the country have outlined the consequences of these cuts on community health. While our local legislators have been understanding, there is simply not a supportive state or national climate overall to effectively resolve this matter.
Date: September 11, 2013