The hospital Board of Governors met on Wednesday, Oct. 12 to revise its 2011-2012 operating budget.
In a surprise development, OMC President and CEO David Zechman arrived as the meeting started, explaining he had been asked by County Judge Charles Willett, "If we would consider an opportunity to manage and help the hospital."
Zechman proposed an arrangement under which OMC "would provide interim management to the hospital for 60 days at no management fee to you."
During those 60 days, OMC and the Fulton County Hospital Board would negotiate an agreement which would allow OMC to manage the hospital for an initial three year period.
Under the management agreement, the Salem hospital will pay for a CEO, which OMC will recruit, along with a monthly management fee, expected to be about $10,000 a month.
In return, OMC will work to reduce expenses and staff at the hospital, improve billing and debt collection, recruit physicians and begin a marketing campaign to emphasize OMC's affiliation, to develop a positive image for the Fulton County Hospital.
Zechman told the board OMC would invest a significant amount of resources into the struggling hospital to improve its patient volume and financial position.
Kim Thompson, OMC's Senior Executive Director of Finance, was named to serve as the interim administrator. Because the board gave approval to the 60 day management agreement, Thompson, a resident of Cherokee Village, is expected to start on Thursday, Oct. 20.
Because of debt and management issues, the Fulton County Hospital Board asked OMC and Baxter Regional Medical Center to present proposals to partner with the hospital.
On Sept. 26, OMC expressed interest in helping the hospital, but declined to make a management offer, saying it had not had enough time to develop a proposal.
The same day, Baxter Regional Medical Center proposed managing the Fulton County Hospital for two years, moving into a long term lease agreement after that time. Baxter Regional's offer was rejected by the board.
While the Fulton County Hospital faces more than one million dollars in outstanding debt, it expects to receive a $1.7 million cash infusion later this year.
The LHC Group has offered to buy the hospital's home health care license, which it currently leases, for that amount.
OMC wants part of that payment to be put in reserve to cover management fees and the salary of the CEO it will appoint.
"I want this to be successful, and I take this on as a challenge to me personally," said Zechman.
"Anything that works is a winner for both of us," newly appointed hospital board member John Ed Welch replied. "A win for you. A win for us, and that would be a good deal."