The hospital in Patrick County. Photo courtesy of Addison Merryman.

Patrick County residents have been without local emergency medical care since September 2017, when Mississippi-based Pioneer Health Services closed its hospital in Stuart, more than a year after filing for Chapter 11 bankruptcy protection. But Cardinal News has learned that a newly formed healthcare provider purchased the former Pioneer Community Hospital last week with the intention of reopening the shuttered facility in the near future – despite a recent study advising against such a move.

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A spokesperson for Chicago-based Foresight HS Property Holdings – Blue Ridge, LLC on Wednesday confirmed that a purchase agreement for the vacant hospital campus is in place and that “Foresight has plans to move forward with a new healthcare facility” and that “timelines will be announced at a later date.”

The new owner will likely be able to take advantage of legislation signed into law by Gov. Glenn Youngkin earlier this week that secured the former hospital’s license as an acute care and critical access hospital – which was set to expire at the end of 2017 – for a future provider to resume operating a similar hospital in Patrick. House Bill 305, sponsored by Del. Wren Williams, R-Patrick County, passed both chambers of the General Assembly with unanimous support during its regular session last month. 

Del. Wren Williams, R-Patrick County. Photo by Markus Schmidt

Williams said in a phone interview earlier this week that the motivation for his proposal was to figure out a solution for Patrick County – a community of 18,000 – to regain access to healthcare. “This was a big part of my campaign and a major reason that I ran for the House,” he said, adding that the hospital’s closure five years ago left county residents without an emergency room and other essential services. 

“It also was a blow to our local employment, but folks have never given up on this, they worked on a number of options, but it took somebody who was willing to get out there and fight for their community in Richmond to make some progress for this hospital,” Williams, who resides in Stuart, said.

Foresight Health’s purchase of the Patrick hospital holds a huge potential for his community, Williams added. “I’m excited for what the future holds for Patrick County. Having local emergency care and local healthcare providers is vital for the wellbeing of our residents and essential for local jobs and businesses,” he said.

Before it shut down, the campus was home to a 25-bed critical access hospital on a 10-acre lot at 18688 Jeb Stuart Highway. Its closure created an access issue for county residents, who were left without a community hospital, said Nancy Bell, population health manager and public information officer for the West Piedmont Health District. 

“Suddenly, rescue squads were forced to transport patients to either Martinsville or Mt. Airy, N.C., and eventually to Roanoke and Winston-Salem,” Bell said in an email. “Being without a local hospital in Patrick County not only prolongs getting critical care to the patient, it requires that rescue squads be away from taking other calls for hours at a time, putting the population at risk due to lack of readily available medical assistance for heart attacks, vehicle accidents and other triage services within the local community.”

In 2020, Healthy Patrick County, a grassroots advisory council established by the West Piedmont Health District, studied access and other health issues facing residents within the county. Because of the deteriorating condition of the shuttered hospital building and the estimated cost of building a new one, plus data illustrating that the traditional hospital model would not work in the county, the idea of opening a new hospital in Patrick County was initially discarded. Instead, the Appalachian Regional Commission provided a $50,000 grant to offer expert guidance to the county. 

The study concluded that a telehealth demand model showed the feasibility of implementing telehealth in the county. “However, lack of broadband is a major concern, especially in the most rural areas of the county,” Bell said. “But all EMS stations have internet access and all communities have an EMS station.”

The State Office of Rural Health then funded the cost of getting the EMS stations fitted to originate telehealth visits from the rescue squad buildings themselves. “This project just started and is slowly gaining recognition,” Bell added. “Still, it is seen by some as a temporary fix. Given that transportation is also an issue in Patrick County, the thought behind this is: Every community has a local EMS station. Getting transportation to it is a lot simpler than getting all the way into Stuart to the only medical practice there.” EMTs would also be able to assist patients who aren’t tech-savvy to sign on with their doctors. 

But EMS transports to far-away hospitals has not been without its tragedies, Bell said. “Several emergency squad members lost their lives to COVID-19 as a result of transporting passengers long distances to hospitals who could take them,” she said.

And Pioneer Community Hospital wasn’t the only healthcare facility in Southwest Virginia to cease operations in the last decade. Lee Regional Medical Center in Lee County shuttered its doors in 2013, following Medicaid and Medicare reimbursement cuts and a lack of consistent physician coverage. 

But last July, the facility reopened as Lee County Community Hospital, a 10-bed modern medical facility operated by Ballad Health, serving rural Pennington Gap and its surrounding communities in Southwest Virginia and Southeast Kentucky. 

However, these few positive developments are in stark contrast to the fact that 181 rural hospitals in the U.S. have shut down since 2005, and 138 since 2010, according to data by the Shepps Center at the University of North Carolina, which tracks hospital closures nationally and by state . The data indicates that many of those closures have been concentrated in Southern and Southeastern states.

“Community hospitals large and small across Virginia are providers of essential health care to scores of Virginians each year and they are also economic cornerstones in their communities as significant employers and community partners,” said Julian Walker, Vice President of Communications at the Virginia Hospital & Healthcare Association.

Many of these rural hospitals serve communities that face both socioeconomic and health challenges, Walker added. And because operating margins are a key measure of a hospital’s financial health, rural facilities often struggle with keeping the lights on. 

In 2020, the statewide hospital patient-payer mix for Virginia was 45.4% Medicare, 17.4% Medicaid, 29.3% commercial, 3% other government payers, and 5% other (generally uninsured or self-pay individuals), Walker said. 

This data shows that Medicaid and Medicare – programs that reimburse healthcare providers below the actual cost of care – account for nearly two-thirds of patients. “In rural communities, the share of Medicaid and Medicare patients tends to be even higher,” Walker said. The consequence: In 2020, one fifth of Virginia hospitals (19.81%) had negative operating margins. Among rural hospitals, roughly one third (32%) operated in the red. 

For the above reasons, the VHHA and its member hospitals and health systems have advocated for measures lowering the financial impact of healthcare costs on patients. “Increasing Virginians’ access to high-quality healthcare is a fundamental principle we believe in and actively work to advance through many initiatives, perhaps most notably in the form of Medicaid expansion, which has helped more than 500,000 low-income Virginians in communities across the commonwealth gain access to affordable health care coverage,” Walker said. 

As part of the compromise to achieve expansion, Virginia hospitals agreed to fund the state share of expansion costs, which amounts to hundreds of millions of dollars from hospitals each year to cover these costs.

But for Patrick County’s former Pioneer Community Hospital, the help came too late. After the hospital filed for Chapter 11 bankruptcy protection in March 2016, Americore – a Florida startup that purchased the Lee County hospital – had planned to save the facility in Stuart, but the deal fell apart in September that year. 

Virginia Community Capital, the Patrick County hospital’s creditor, ended up foreclosing and buying the property. VCC spokeswoman Valerie Lee said in an email Tuesday that Foresight HS Property Holdings purchased the facility last week. Based in Chicago, Foresight was registered as a domestic limited-liability company on Feb. 22, with legal representation in Virginia Beach. 

Asked about Cardinal News reporting that confirms a deal has been struck to re-open the hospital, the VHHA’s Walker said that while he is not privy to those particular details, the possibility that the hospital may be re-established would be welcome news for Patrick County and surrounding communities. “Increasing health care access and acute care services is a good thing for the health of the commonwealth and its people,” Walker added.

Markus Schmidt

Markus Schmidt is a reporter for Cardinal News. Reach him at markus@cardinalnews.org.