The information, under Noble Health letterhead, arrived at 5:05 p.m. on a Friday, with the topic line: “Urgent Notice.” Audrain Neighborhood Hospital, Paul Huemann’s office of 32 years, was letting employees go.
Phrase travels quick in a small city. Huemann’s spouse, Kym, first heard the unhealthy information within the automotive when a pal who’d gotten the letter, too, texted.
“Your termination was not foreseeable,” said the letter, dated Sept. 8 and signed Platinum Well being Programs, including that the firing was everlasting “with no recourse” and that the “medical facility shall be shuttered.”
“I do not know what my subsequent steps are,” stated 52-year-old Huemann, who supervised the laboratory on the Audrain hospital.
The long run for the Huemanns, a whole lot of different employees and 1000’s of sufferers in two small Missouri cities started to unravel lengthy earlier than that afternoon. The drama enjoying out in Paul Huemann’s hometown is acquainted to many who reside in rural America: Communities are so determined to maintain their hospital open that they are keen to gamble on any purchaser, together with these backed by non-public fairness.
Typically they lose.
Noble Well being, a three-year-old non-public equity-backed startup, had acquired Audrain and close by Callaway Neighborhood Hospital throughout the pandemic. In March, it suspended all hospital providers and later furloughed 181 staff, state records present.
Noble — dealing with staggering debt, greater than a dozen lawsuits, and at the least two federal investigations — struck a deal to promote the hospitals in April to Platinum Neighbors, which is affiliated with Texas-based Platinum Team Management and Platinum Well being Programs. In late June, Platinum asked Missouri officers to increase till Sept. 21 a deadline to reopen the hospitals.
On Tuesday, Platinum officers advised KHN that, “on behalf of Noble,” they requested Missouri regulators for an extra 30-day extension “in an try and discover all alternate options for reopening these amenities,” Ryann Gordon, Platinum’s director of selling, stated. “The backpay and well being advantages of the workers is of utmost significance.”
Hours earlier than the licensing deadline Wednesday, Platinum submitted a request for a 90-day variance. Missouri rules don’t permit one other extension inside a yr, stated Lisa Cox, a spokesperson for the Missouri Division of Well being and Senior Providers. So the state “labored with them” and granted the request, she stated.
Platinum stated the hospitals want time to finish development tasks. Audrain’s “emergency room space” has damaged home windows, and Callaway’s hospital wants “essential restore to the plumbing,” based on the state approval letter. The hospitals can change possession throughout the 90 days, Cox stated.
Cory Countryman, president of Platinum Well being Programs, confirmed the termination of the remaining hospital workers. “We’re working with a number of companions to reopen the hospitals,” he stated.
That would contain a brand new proprietor. One prospect is Owen Shuler, a Georgia-based entrepreneur, who stated he is considering shopping for them. Shuler, who was reached by cellphone after he’d visited the agricultural communities, stated, “I like what I see.”
“It is heartbreaking as to what has occurred,” stated Shuler, whose corporations embrace Bankers Realty Corp. and Shuler Capital Corp. If he purchased the hospitals, he stated, he would achieve this as managing director of his new enterprise, CareONE International. “By way of the due diligence, I don’t like what I am seeing and studying,” he stated. What he concluded from his evaluation is that “non-public fairness and enterprise capital must be saved the heck out of well being care.”
On his LinkedIn profile, Shuler stated he “brings a lifelong perspective from a family owned skilled care business” in addition to experience in “telemedicine and healthcare providers.”
Shuler, who confirmed the hospitals had been saddled with substantial debt — “within the ballpark” of $45 million to $50 million — stated, “I’m not ready to go on the file about enterprise technique fairly but.” He stated his strategy can be “holistic” and embrace telehealth. Many business leaders have argued telehealth is a solution to deliver high-quality medication to rural communities that may’t afford, and do not want, a full platoon of specialists on-site.
“Our goal is buying hospitals in rural and deprived areas and introducing our capabilities to them,” Shuler stated, including that fixing the 2 “mainly damaged” Missouri hospitals from the underside up can be “a lot simpler than attempting to enter a wholesome system.”
Nonetheless, it is unclear whether or not Shuler or one other purchaser will come via and what it will take to reopen them after years of possession instability and monetary bother.
Enterprise capital and personal fairness agency Nueterra Capital launched Noble in December 2019 with executives who had by no means run a hospital, together with Donald R. Peterson, a co-founder who previous to becoming a member of Noble had been accused of Medicare fraud. Peterson settled that case with out admitting wrongdoing and in August 2019 agreed to be excluded for five years from Medicare, Medicaid, and all different federal well being applications, based on the Well being and Human Providers Workplace of Inspector Normal.
Federal regulators didn’t block the acquisition wherein Peterson was concerned. “All possession and managing management data is self-reported,” stated Facilities for Medicare & Medicaid Providers spokesperson Kristen Clemens.
Skimping on care
It did not take lengthy for issues to floor below Noble Well being’s stewardship. Noble has accepted almost $20 million in federal COVID-19 aid funds, together with $4.8 million from paycheck safety applications, based on public data.
But doctors, nurses, and patients noticed proof that the brand new house owners had been skimping on providers — failing to pay for and inventory surgical provides and medicines. In Callaway, state inspectors decided that conditions in the hospital endangered patients. Former employees offered KHN payments and pay stubs they stated confirmed Noble had also stopped paying for worker well being, dental, imaginative and prescient, and life insurance coverage advantages.
After staff filed complaints about shock medical payments, the Division of Labor’s Worker Advantages Safety Administration launched an investigation in early March, based on a letter sent to the company and obtained by KHN. The division confirmed a second investigation by one other considered one of its divisions, Wage and Hour, into Noble’s administration of its Audrain hospital and clinic.
In April, Noble struck a deal to promote each hospitals for $2 and a inventory switch to Platinum, which assumed all liabilities, according to the agreement. In a June 22 letter to state regulators in regards to the hospitals’ working licenses, Platinum stated, “We’re requesting this continuance as Noble Well being inventory has been transferred to Platinum Medical Administration.”
Whereas visiting the hospitals in April, Countryman advised staff it was a “precedence” to pay the again wages Noble owed them.
Neither Noble nor Platinum made good on that within the months since, staff contend. Along with the federal investigations, 9 wage claims — the most important for $355,000 — have been filed in opposition to Noble in Kansas, based on data provided via a Kansas Open Information Act request.
By early August, others had been recognizing the worker complaints. Principal, which offered dental and imaginative and prescient care protection, sent letters to employees saying it will not demand that any employee repay advantages the insurer coated after Noble stopped sending premiums for worker protection. “This example shouldn’t be typical,” wrote Principal spokesperson Ashley Miller in an electronic mail.
Huemann, as laboratory supervisor, was among the many employees who weren’t furloughed within the spring. They reported for work daily within the hopes that the Audrain hospital would reopen. Huemann checked reagents and saved machines operational whilst cash for provides was tight.
“We could not get something,” Huemann stated, “so we had been residing with what we had.”
Huemann, who offered pay stubs to KHN, stated he acquired a paycheck from Noble in late March. He stated he didn’t obtain one other paycheck till late Could. He acquired common paychecks in June and early July. However his second July verify, below Platinum, was per week late. His last paycheck arrived Aug. 8 and was additionally late.
His final seven checks got here from three corporations. They had been all on Platinum’s watch: Initially Platinum Neighbors issued the checks, then Callaway County Neighborhood Hospital, and eventually Noble Well being Audrain Inc.
“Everybody cashed their verify as quickly as they obtained it,” Huemann stated. “There are such a lot of crimson flags. However you already know, we’re at their mercy, we’ve no management, and we’re nonetheless grateful they’re saving us.”
The verify stubs additionally present the hospital’s operators deducted $1,385 in complete from Huemann’s pay for insurance coverage. The medical insurance coverage was imagined to be with Blue Cross and Blue Defend of Texas, however Huemann stated he by no means acquired a card and couldn’t affirm protection.
“I known as 4 or 5 occasions on completely different days,” he stated. “They might by no means discover me regardless of how they appeared me up, with Social Safety or date of beginning, or something.”
Countryman referred all monetary inquiries to Platinum’s company places of work. Ryan Cole, chief govt of Platinum Staff, didn’t instantly reply to calls and emails searching for remark.
Some medical doctors left city because the upheaval swallowed the hospitals.
Others, reminiscent of household medication physician Diane Jacobi and her nurse practitioner, Regina Hill, joined MU Well being Care, affiliated with the College of Missouri, in Mexico, Missouri, the 11,000-person city the place Audrain Neighborhood Hospital is situated.
Jacobi stated her sufferers need native care. “I do not know for those who’re a mama, however for those who’re in labor, the concept you must spend 45 minutes in a automotive on the way in which to the hospital is nerve-wracking,” she stated. “It is safer if in case you have care.”
Lou Leonatti, an legal professional who lives in Mexico, stated he feels so strongly that the group wants a hospital and emergency care that he offered loans final yr to Noble so the corporate may meet payroll. Leonatti’s private $60,000 mortgage, with an rate of interest of about 3%, was due in January however, he stated, stays unpaid.
Leonatti helped begin Undertaking Dawn, an area financial growth group. If a brand new settlement shouldn’t be reached, he stated, “we wish to have a Plan B accessible.”
Peterson, who helped launch Noble’s failed effort to show across the two Missouri hospitals, appears to have discovered his Plan B in Dubai. “I am sitting within the Emirates Air lounge in Dubai marveling on the expertise being afforded me on the tender age of 68,” he wrote on LinkedIn. “I will be in Riyadh for the following week ending up due diligence on launching a brand new enterprise there.”
The submit made Tonya Linthacum, a nurse practitioner who labored at Audrain’s most cancers screening middle for greater than twenty years, livid. She stated that he “destroyed lots of people’s lives and livelihoods,” including that “to have somebody dupe you want that” and “occurring with no penalties. It is simply not the way in which the world is meant to be.”
Peterson declined to remark.