Lee County hospital board cuts ties with Florida company after missed deadline

This story was reported with the support of the Dennis A. Hunt Fund for Health Journalism, a program of the University of Southern California Center for Health Journalism.

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PENNINGTON GAP — The Lee County Hospital Authority on Thursday cut its losses with the Florida startup that it partnered with to open and run its hospital.

Americore Health failed to meet a Dec. 31 reopening deadline. Despite CEO Grant White’s assurances last month, he failed to show proof that if given an extension, he could secure the financing required to pass state licensing inspections, hire employees and operate until insurers began to pay.

Commissioner Howard Elliot said Americore stopped responding to the authority, so chairman Ronnie Montgomery sent letters of default. The board ratified that action on Thursday.

“Tuesday night, following their receipt of those notices, we received a call from Americore and began active discussions with them. I can report we are making significant progress,” said board attorney Jeff Mitchell.

He expects the authority board to meet again Monday to approve separation terms that include Lee County regaining possession of its building.

The hospital authority in 2017 sold the building to Americore for $1.6 million and entered into a management agreement that would allow the company to use its state authorization to run a hospital.

Americore replaced the roof, repaired the plumbing and moved some equipment into the building, although one vendor in December removed equipment due to nonpayment, Mitchell said. Work had stopped in September when several of Americore’s creditors filed suit for nonpayment in New York and sought to freeze bank accounts.

White said in an interview then that Lee County would open by the end of the year despite the lawsuits.

“We have the access to cash and the capabilities to get Lee County reopened, and we also are resolving any disputes with existing creditors,” he said.

The lawsuits appeared to have been settled in late October about the same time the Lee County authority required Americore to file daily progress reports. Authority member Howard Elliot said in December that did not occur and no substantive report had been provided since the beginning of November.

Meanwhile, news outlets in Pennsylvania reported Americore failed to pay taxes and utilities for its Ellwood City hospital and continues to be chronically late with payroll.

Americore has failed also to meet payroll dates for the hospital it owns in Pineville, Kentucky. The first time payroll checks bounced there preceded a vote by Lee County to sell its hospital to Americore. White had assured authority members then that his company had the financing and the connections to build a new model of health care in rural America, though he declined to provide details.

The authority sold the building but gave Americore three years before any payments were due. The authority also agreed to allow its note to be subordinate to that of another lender so that White could obtain funds to begin the project.

Mitchell said Americore is in default to that lender.


Separately, the authority engaged Americore to operate a hospital by using its state authorization called a Certificate of Public Need. That authorization was set to expire Dec. 31.

Virginia’s health commissioner agreed last week to give Lee County four more years so they could find another partner should Americore falter.

Authority members have not commented on Americore’s difficulties in Pennsylvania and Kentucky.

“Our recommendation as a firm that, at this point, the authority set aside for the moment any conversations about any other issues involving Americore and simply focus on concluding this negotiation,” Mitchell said.

White has not replied to texts and emails seeking comment; his voicemail was full and was not accepting messages.

Americore’s website continued this week to show that Lee County was one of its four hospitals, but the hyperlink led to a message that the domain name expired on Jan. 4.

[This story was originally published by The Roanoke Times.]