With Closing of Pauls Valley Hospital, a City’s ‘Peace of Mind’ Is Shaken

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Whitney Bryen/Oklahoma Watch

The Pauls Valley Hospital Authority decided on Friday, Oct. 12 to close the 62-bed Pauls Valley Regional Medical Center. The hospital had filed for Chapter 9 bankruptcy to restructure debt in 2013 and emerged from bankruptcy in 2016.

After years of financial struggles, the Pauls Valley Regional Medical Center has closed, with officials saying they could not secure enough funds to keep the hospital going.

As a result, more than 100 hospital employees will lose their jobs and the community of 6,200 will be deprived of a nearby health center that tended to wounds, provided simple surgeries, and stabilized patients before transfer to larger, urban hospitals. The hospital served Pauls Valley and surrounding areas in Garvin County.

Gary Alfred

“It’s very disheartening. It’s a sad, sad situation,” said Mayor Gary Alfred, who also chairs the Pauls Valley Hospital Authority, which made the decision Friday. “We did everything we knew, that we could have. It hadn’t worked.”

The central issue was finding enough money to meet payroll, which became difficult after the hospital’s previous management company called in a promissory note secured by the hospital’s future billings, or accounts receivable. A judge upheld the company’s action.

“When you have no money you can use as accounts receivable, you can’t run a hospital,” Alfred said.

He said officials have received a few calls from entities interested in taking over the hospital, but it’s too early to know if these will go anywhere.

In the meantime, many residents are disappointed, if not devastated.

“(A local hospital) takes care of a lot of health needs,” Alfred said. And, “to be honest, it gives a lot of people peace of mind, especially the elderly.”

Brock Slabach, senior vice president for member services at the National Rural Health Association, said 87 rural hospitals have closed across the country since 2010.

In general, Slabach said, the most serious challenges rural hospitals have faced are:

> The effects of mandatory across-the-board federal spending cuts, known as sequestration, on Medicare payments to providers.

> The drop in Medicare’s reimbursement rates for hospitals to cover bad debt.

> The fact that rural hospitals treat higher percentages of patients who are old, sick and poor.

> A decline in the number of patients caused by various factors, including insurers limiting covered hospital stays, and higher deductibles causing patients to put off treatment.