Pioneer Community Hospital of Newton will close Dec. 1 after losing a key federal funding status, becoming the fourth Mississippi hospital to close since 2013.
Magee-based Pioneer Health announced the closing in a news release dated Wednesday. The company said the federal government revoked the hospital's critical access designation. Hospitals with that status are paid 101% of the cost of treating patients to help cover what are presumed to be higher costs in rural areas.
Losing that status "makes the operation of the hospital no longer financially feasible," hospital CEO Mark Norman wrote in a news release.
The hospital has already laid off 16 employees and has 140 remaining, Norman wrote in a Friday email to The Associated Press. He said not all of those employees would lose their jobs. He said Pioneer plans to operate a clinic with extended hours including weekends.
Critical access hospitals, unless certified before 2006, must be at least 35 miles from other hospitals, or at least 15 miles on secondary roads. The Centers for Medicare and Medicaid Services had previously been paying the Newton hospital under the formula. However the federal agency notified Pioneer on Nov. 12, 2014, that it didn't meet the distance requirement for critical access, saying hospitals in Forest and Meridian were too close. Lackey Memorial Hospital in Forest is also run by Pioneer.
Norman said CMS gave Pioneer until Dec. 1 to convert back to regular reimbursement.
"They just couldn't figure out how to make it work with a new payment system," said Mendal Kemp, director of the Mississippi Hospital Association's Center for Rural Health. Pioneer reported to CMS the Newton hospital lost $580,000 in 2014, according reports quoted by American Hospital Directory.
The closure points out the financial fragility of many of Mississippi's rural hospitals, said Therese Hanna, executive director for the Center for Mississippi Health Policy.
"It's not just this one hospital," said Hanna, whose group issued a report this week on rural hospitalfinances. "It's that we have a fair number of hospitals in the state that could be vulnerable to closure."
A Belzoni hospital closed in 2013, while hospitals in Kilmichael and Natchez closed this year.
Local, state and federal officials said Friday that they were trying to find a way to keep the Newton hospital open.
"We're working to try to find a way to put this off for a while until all these things have a chance to fall into place," said state Sen. Terry Burton, R-Newton.
Burton expressed particular concern about the lack of an emergency room.
"It's very important to keep some emergency care there," he said. "Even though there are hospitals within 35 miles, they're not within lifesaving distance."
Gov. Phil Bryant and majority Republican state lawmakers have declined to expand Medicaid in Mississippi as envisioned under the federal healthcare overhaul. Both Hanna and Kemp said the high share of uninsured patients in rural areas hurts hospitals. Burton, though, said Medicaid expansion wouldn't have overcome the critical-access problem.
"Medicaid expansion would have nothing to do with this hospital being open," he said.
