Future of Welch Community Hospital shrouded in politics and uncertainty

By Matthew Young

Big changes could be ahead for Welch Community Hospital if Del. David Green, R-McDowell, has his way. Not only is Green advocating for the privatization of the hospital, but he’s also encouraging any potential buyers to pursue a federal “critical access hospital (CAH)” designation. 

While taking his argument to Facebook on June 3, Green described the Critical Access Hospital designation as being “built specifically to keep small, rural hospitals like ours alive and strong.”

“There’s one not far from us, right here in southern West Virginia, with the same kind of community, patients and payer mix that we have,” Green added, although failing to specify which hospital he was referring to. “It’s operated that way for close to 15 years. It’s been a true partner to its community, it has grown its services instead of cutting them, and both its patients and its employees are satisfied.”

What are the concerns surrounding Welch Community Hospital?

Aside from the untrue-but-pervasive rumor that Welch Community Hospital will be shuttered, the concerns surrounding the facility stem from the cost of its operation. According to Green, “Our hospital costs about $35 million a year to run, but only brings in about $15 to $17 million.”

“That means it losses somewhere between $18 and $20 million every single year, and the State has carried that loss for years,” Green noted. “This is not one administration’s opinion. The past administration under Governor (Jim) Justice, our current administration under Governor (Patrick) Morrisey, and members of the Legislature on both sides agree on one thing – the State of West Virginia should not be in the business of running hospitals.”

Generally speaking, state run medical facilities are typically operated as non-profit entities, meaning they do not contribute to a state’s general revenue fund. They are self-contained institutions, and any excess patient revenue is traditionally reinvested back into the facility. As reported by kff.org, the national average for patient revenue at state run hospitals is approximately 5.2% of the facility’s annual operating budget, or slightly over $13 million. This is a similar method to the way that other essential government-operated non-profit entities – such as police and fire departments – are managed. 

“To be clear, there is no intent to close Welch Community Hospital, nor has closure been contemplated,” stated a June 8 press release from the West Virginia Department of Health. “We are exploring options to ensure that Welch will continue to deliver care to McDowell County and surrounding areas for the long-term in the face of real financial challenges that the hospital faces.”

Who would run Welch Community Hospital if the State sells it?

Early last November, Gov. Patrick Morrisey’s office announced the sale of four of West Virginia’s seven state run hospitals. Hopemont Hospital in Terra Alta, the Jackie Withrow Hospital in Beckley, the John Manchin Sr. Health Care Center in Fairmont, and Lakin Hospital in West Columbia were all sold to the New York-based Marx Development Group for $60 million. Day-to-day operations at all four locations is currently being managed by Marx Development Group’s subsidiary, Majestic Care. 

Prior to finalizing the sale of the four facilities, Morrisey made his intentions to sell off the remaining three hospitals clear. However, no further information has been released by the governor’s office since last November’s sale. Although BBG contacted Morrisey’s press team on both Tuesday and Friday of last week requesting confirmation of current negotiations with a prospective buyer, those requests were not returned. 

“The decision about whether to sell or transition the hospital sits with the governor’s office – it always has,” Green said as part of his June 3 Facebook post. “The Legislature does not make that call. I’m not the one deciding this, and I’m not here to sell you on it.”

What is a “Critical Access Hospital?”

For starters, a Critical Access Hospital, regardless of whether the state retains ownership, must accept Medicaid. According to Green, “When a hospital earns that label, the federal government pays back most of the cost of care. Add in a special hospital pharmacy program on top of that, and a small-town hospital can finally stop losing money and actually become strong and profitable.”

Green’s statement, on its face, is true. However what Green failed to mention are the additional requirements which would be imposed upon Welch Community should it obtain a CAH designation. While 24/7 emergency care would still be available and average in-patient stays would remain relatively unaffected, the hospital’s total number of beds would be significantly reduced. Currently, Welch Community Hospital has 65 acute care beds available. If the hospital were to receive the CAH designation, their acute care bed-count would shrink to a maximum of 25. 

Does Welch Community Hospital have a statement regarding their future?

On July 30, Dr. Michael A. (Tony) Kelly, chief of staff at Welch Community Hospital, released a statement in response to what he described as being asked “scores of times ‘What is Delegate David Green up to?’”

“The answer is quite simply that no one knows,” Kelly said. “He apparently has appointed himself, without discussions with Welch Community Hospital medical executive, hospital administration or Department of Health Facility personnel as a negotiator for the future of our hospital! He has also had no discussions with elected officials from the City of Welch, McDowell County Commission or West Virginia state officials about this subject.”

The State owns Welch Community Hospital, but who owns the land?

To complicate things for the hospital’s future even further, a real question has been raised surrounding the conditional ownership of the land where the hospital sits. 

According to information obtained from the West Virginia Department of Health, “Welch Community Hospital, the only State-funded acute care facility in West Virginia, is the only hospital in McDowell County. The hospital originated as a result of 1899 legislation that required the building of State hospitals for people engaged in dangerous occupations, particularly coal mining. Miners Hospital No. One opened in Welch on January 28, 1902.”

“The hospital is located on three acres within the town of Welch,” the Department of Health adds. “The land was donated to the State in 1899 by J. J. Sperry specifically for the purpose of building a hospital. A $12 million renovation was completed in 1984. Medical services include surgery, obstetrics, intensive care, and an Emergency Department.”

As of the time of this writing, it remains unclear if the State has legal standing to sell the property, or if West Virginia code requires it be kept and operated by the State. A public meeting was held in Welch on Aug. 6, however the questions surrounding the property’s sellability remain unanswered. 

BBG will provide updates regarding the status of Welch Community Hospital as additional information is made available.