LACONIA — Employees of LRGHealthcare are breathing a sigh of relief now that a plan has been identified after years of uncertainty about its financial future.
“I’m excited,” said LRGH registered nurse Marilyn Ireland, a quality improvement coordinator. “I think it will be a positive thing. Concord Hospital has been there as long as we have. There is a lot of collaboration already in place that will make it an easy transition.
“The feeling of relief is almost palpable within the organization. We can see a way forward now. There was so much uncertainty. That impacts stress levels and erodes morale — the uncertainty of not knowing.”
Years of high debt, low cash on hand and a payer mix providing inadequate reimbursement were resulting in losses of well over $1 million a month before the pandemic greatly lowered revenue and forced an abrupt furlough of 600 of its 1,400 employees.
Most of those employees have now returned to work.
In a $30 million bid for LRGH’s assets, including Lakes Region General Hospital and Franklin Regional Hospital, Concord Hospital has agreed to take over the system’s pension program and plans no changes to salary, benefits and earned time off.
Ireland, who was furloughed in April and May, said one concern that remains is the possibility that Concord Hospital will not be the one to take over.
Its initial bid will serve as the starting point for an auction in which other healthcare organizations can seek to buy LRGH's assets. Concord Hospital would have the opportunity to counter a higher bid.
“I hope some other organization that doesn’t belong in our neck of the woods doesn’t come in and outbid them,” Ireland said.
Former LRGH board member Chip Broadhurst said there is no guarantee that Concord Hospital will emerge from the auction with the winning bid.
“If someone comes in with more money, the money speaks,” he said. “In the next three to six months we’ll have an outcome. It would be wonderful if the outcome were as the folks have modeled it at this stage.”
Dr. Michael Tevell, who headed obstetrics and gynecology at LRGH before retiring last year, said Concord Hospital would be the reasonable and logical choice to take over the healthcare system.
Such a move might also be good for employee morale, which took a hit two years ago when the decision was made to close the local and long standing labor and delivery service. Many in the community also took the decision hard.
Hospital leaders say the service was expensive to run, served a shrinking number of women and is unlikely to come back.
Tevell said ending labor and delivery was a “terrible decision” as it served a population of women who can’t easily travel to Concord.
“It took away a service to a lot of people that really needed it,” he said. “We'd see patients walking to appointments because they didn't have cars, people walking in while in labor.
“It’s ironic, they discontinued the service to save money, and now they’ve filed for Chapter 11.”
Dr. Stephen Marshall, an LRGH urologist who works out of the Laconia Clinic, said there is a positive feeling now that the healthcare system is confronting its financial problems head on.
“The medical staff as a whole is relieved to have a plan,” he said. “Bankruptcy has a negative connotation, but it was a much needed step toward securing our future.
“The biggest fear is that our services shrink. I want us to remain a vibrant hospital and not a referral center.”
Marshall said he also wants to reinforce for the community that the bankruptcy proceedings will play out in court, not in doctors’ offices, where it will be business as usual.
He praised colleagues from Concord Hospital.
“We have tremendous respect for the Concord urology group,” he said. “We collaborate clinically already and this would formalize something that already exists.”
Broadhurst, the former LRGH board member, praised LRGH President and CEO Kevin Donovan, and his team, who have been trying to overcome financial problems that preceded their tenure.
“The big picture is that he was dealt an impossible hand and to have kept the place alive for as long as he did with as little to work with as he had has astonished me,” Broadhurst said.
Donovan joined LRGH four years ago at a time when it was already facing financial pressure from very high debt and insufficient reimbursement for services.
“He came into an impossible situation,” Broadhurst said. “I think he has approached the thing with dignity, professionalism and he never complained.”