Paulding (Ohio) County Hospital has ended a controversial relationship with Quorum Health Resources, which it hired to manage the facility in 1993.
The board of the 44-bed rural hospital opted to sever ties with the Brentwood, Tenn.-based firm in August-12 months before its current contract was to expire-when a Quorum-appointed chief executive officer transferred to another facility.
That executive, Joseph Dorko, became chief operating officer at Quorum-owned Lutheran Hospital of Indiana in Fort Wayne.
Paulding County independently recruited Larry Thornhill, formerly COO at Touchette Regional Hospital in Centreville, Ill., to be its new CEO. Thornhill took the helm Aug. 25.
An initial five-year management agreement with Quorum, signed in February 1993, drew complaints from hospital staff, physicians and community members, who objected to the company's management decisions and its fees. Eight citizens filed a lawsuit in 1994 in an attempt to void the contract, but the suit was dropped (May 13, 1996, p. 32).
In 1997, the contract was renegotiated and extended until August 2000. At the time of the renegotiation, the hospital's board decided it would not renew the management contract when it expired, said Gary Adkins, Paulding County chief financial officer.
The hospital's financial results have improved steadily in the past three years, largely because of a strategy of employing physicians, which boosted referrals for ancillary services, Adkins said. In 1998, the hospital had net income of $430,173 on net revenues of $10.5 million.
Adkins said the hospital has been less profitable in 1999 because of a January snowstorm that shuttered physicians' offices.