Rolla-based Phelps Health Plan will take over a small 25-bed hospital in Dent County.
Phelps and Salem Memorial District Hospital south of Rolla signed a letter of intent allowing Phelps to lease Salem Hospital for 10 years and take over day-to-day management.
“If we can turn things around toward a break-even proposition and bring our services as close to the region as possible, that’s what we’re looking forward to,” said Jason Shenfield, Phelps’ president and CEO. That’s what I’m doing.”
Financially strapped rural hospitals have struggled to stay afloat over the past decade. More than 150 rural hospitals across the country have closed since 2010, according to the Sheps Center at the University of North Carolina.
The Salem facility is a critical access hospital that provides critical services to underserved and rural areas. Such hospitals typically provide 24-hour emergency care and are required to serve areas where there are no other hospitals nearby.
The hospital serves more than 20,000 residents in Dent and surrounding counties. In addition to inpatient beds and emergency care, we also offer services such as outpatient surgery, physical therapy, and a compounding pharmacy.
“South of Salem, I would say it would be close to two hours to get to the next hospital or emergency room,” Shenfield said. “It’s really about making sure we have critical emergency services and critical access hospital beds.”
Salem Memorial District Hospital officials could not be reached for comment.
Shainfield said he believes a larger hospital will help keep Salem Hospital’s emergency medicine and other critical services operating.
“I think we offer some economies of scale,” he said, “and help with some of the financial challenges and even administrative support that smaller organizations can’t necessarily achieve on their own.” It also contributes to the enhancement of the
Shainfield said he does not expect Salem Hospital employees to lose their jobs if the deal goes through. He said the organization may need to hire more employees.
Brock Slabach, chief operating officer of the National Rural Health Association, said partnering with large health systems can provide some financial stability for smaller hospitals that lack the resources or bargaining power. said.
“It’s not that far from Rolla to Salem, so I think it’s a relatively local partnership. I think it’s probably a win-win,” he said.
Southeast and south-central Missouri regions have high rates of chronic illness and the uninsured, requiring hospital services. Slough said.
“It’s a slightly more challenging environment to make services available,” he said. “But they seem to be working on solutions to continue to buck the trend that unfortunately happens too often in places like this.”
Phelps health officials said they were negotiating a contract and conducting a due diligence investigation before signing the contract. That could happen as early as a few months, Shainfield said.
