A $1.9 million breach of contract lawsuit filed against Santa Cruz Valley Regional Hospital by doctors last month doesn’t begin to tell the financial story at the hospital, according to past and current employees who contacted the Green Valley News.
The hospital’s CEO told a different story in an interview Tuesday.
Green Valley’s hospital exited from bankruptcy in July, but medical professionals and others associated with the hospital claim it continues to suffer from immense financial problems that have unpaid vendors pounding on the door, supplies running low or running out, and patient care suffering.
Hospital CEO Kelly Adams acknowledged in an interview Tuesday that the hospital owes money to vendors but said it is “financially solvent,” patients continue to receive exemplary care, and supplies on hand are “adequate.” He said he was not certain how many vendors were owed money.
“People are feeding you guys stuff that’s not totally accurate and I’m bothered. I’m bothered by that. I can’t figure out why,” he said. “Our patients are safe. They’re well cared for.”
On Dec. 18, lawyers for Global Hospitalist Solutions filed a lawsuit in Pima County Superior Court claiming the hospital owed the company $1.9 million. GHS signed a contract with the hospital in January 2018 to provide doctors and ultimately staffed the hospital floor, ICU and Emergency Department. GHS ended services Dec. 31, a month before the contract was up.
The lawsuit was filed five months after Green Valley Hospital emerged from bankruptcy and changed its name.
Santa Cruz Valley Regional Hospital, which opened as Green Valley Hospital in May 2015, struggled to fill its 49 beds and recruit and retain specialists from the beginning. It filed for bankruptcy in April 2017 to get out from under crushing debt and to secure long-term financial stability.
In February 2018, U.S. Bankruptcy Court in Phoenix approved the purchase of the hospital by Lateral GV, an offshoot of California-based Lateral Investment Management, the lone bidder on the property. The bankruptcy case was finalized July 25.
Earlier this month, Adams declined to comment on the lawsuit, but sought to reassure residents about the financial stability of the hospital. He also denied claims by three people with connections to the hospital who told the Green Valley News that the ICU had been closed numerous times due to staffing issues.
In the days after the article was published Jan. 6, numerous past and current employees contacted the newspaper upset over Adams’ comments. They said the ICU was closed 28 to 42 days from August to Dec. 31, specifically because of a lack of qualified nurses.
The sources, whom the Green Valley News is not naming, said the hospital has been unable to hire an adequate number of nurses, patient care technicians and other staff because of the bankruptcy and the layoffs of 62 employees in July. In addition:
Three people said they quit because they feared they would lose their licenses because of the unsafe staffing levels and the potential for bad patient outcomes.
Several cited examples of patients with life-threatening conditions being admitted to the hospital despite the lack of qualified medical professionals on-site to treat their specific ailments.
The hospital is losing vendors due to chronically late payments, some as much as 90 days overdue.
The hospital is consistently without basic medical supplies, including, at times, surgical needles, bed pans, needles to draw blood, lab tubes, oxygen sensors and bed pads. Two sources said the hospital went more than a week without defibrillation pads for pediatric patients.
In an interview Tuesday, Adams said the ICU has only been closed for a few days at most and it was due to a lack of patients during the summer.
“We’ve always had staff, we’ve always had nurses,” he said.
Adams is founder and partner of ERH Health Care, a Salt Lake City company that helps underperforming and distressed healthcare organizations. He was brought in last summer as the hospital’s fourth CEO.
Allegations about patient care being compromised and a lack of supplies are not true, Adams said. He acknowledged the hospital is behind on some bills but said he anticipates being caught up by early March. The hospital switched to a new electronic medical records system in November, which resulted in bills being processed late and a slowdown in revenue, he said.
“That’s the root behind the cash slowdown. Our owners are aware of that, they’re supportive of where we are and they make up the difference in where we are,” he said. “Our vendors will be paid.”
Adams said he couldn’t immediately say how many vendors the hospital has, how many are owed money or the amounts owed. He said those details are the responsibility of the hospital’s chief financial officer.
“You know, I think there are some utilities that are behind. There are several that are behind but, as I mentioned, all of those will be paid. We’re starting to see the cash come through now,” Adams said.
Several vendors contacted for this story declined to comment, citing privacy concerns. The Green Valley Domestic Water Improvement District said the hospital was current on its water bill.
Adams said owner Lateral Investment Management is 100 percent behind the hospital.
“Lateral is supportive. They know exactly where we are and they are supportive, just like they did during the Chapter 11 time,” he said. “This is a small, small issue compared to what they’ve been through.”
Patrick Feeney, the managing director of Lateral Investment Management, also said Tuesday that the hospital “has our full financial support. We’re here.”
The hospital will be in much better shape in six months and has already seen a 30 percent increase in its emergency room visits since last quarter, Adams said.
The word is out that GHS has been replaced by doctors who are “boarded, trained and experienced in emergency medicine,” Adams said.
The hospital is dedicated to finding ways to attract new physicians and bring new patients in, he said.
The hospital has recently hired two general surgeons and a podiatrist and will soon open a 12-bed wing that has never been opened, he said. He hopes to hire 15 to 20 nurses this year; currently, 40 percent of the hospital’s nurses are traveling nurses, who are much more expensive, Adams said.
A certified chest pain center is also in the works, too, he said.
Adams said the hospital will make it.
“Oh, more than make it. I hope to sit down with you in six months from now and the conversation will be significantly different,” he said. “The hospital will make it.”
Date: January 21, 2019