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Proposed sale of Shelby hospital stokes controversy, concerns over local care

County-owned hospital losing at least $500,000 a year
Posted at 5:54 PM, Oct 29, 2019
and last updated 2019-10-29 20:15:57-04

SHELBY — Toole County officials are proposing to sell Shelby’s county-owned hospital, to end its years of losing money – but leaders of the local nonprofit health clinic worry the sale could undercut local control of and access to quality care.

“The concern for our clinic, as well as the public, is how are we part of that model – and what does that model look like?” says Jamie Brownell, CEO of Marias Healthcare Services, which is the clinic. “Do we get to maintain the high-quality, affordable access to care that we are used to today?”

Physicians at the clinic – which employs nearly all physicians in Shelby – also have called for the resignation of hospital CEO William Kiefer. They say he has antagonized health-care staff and local physicians and has a “lack of commitment” to the hospital and the community.

Kiefer lives in Gallup, New Mexico, and commutes to Shelby for 10 days a month, or more, if needed. He is paid $400,000 a year as hospital CEO and nursing director, plus expenses.

Kiefer told MTN News Tuesday that he’s committed to working with his hospital staff and others to find a “strategic partner” that can get the hospital out of debt and keep it open and prospering.

“A strategic partnership could build on the services that are here,” he said. “I don’t see (the sale) as a negative. I hope we can find a strategic partner that is going to build upon what is right here.”

County officials have stood behind Kiefer, against the call for his resignation.

The county is holding a public hearing Wednesday evening at the Shelby High School auditorium on the proposed request-for-bids on the 21-bed hospital, a 40-unit retirement and assisted-living facility and 63-bed nursing home – all owned by Toole County.

Kiefer said the hospital, one of the few county-owned hospitals in the state, has been losing more than $500,000 a year, which must be covered by the county.

Part of the reason for the deficit is county ownership, which prevents the hospital from receiving about $600,000 a year in payments from Medicaid, the state-federal program that pays medical bills for the poor, Kiefer said.


He said the county hopes to find a larger operator, with deeper pockets, that can buy the hospital, become eligible for the higher Medicaid payments and put more resources into the facility and keep health-care providers in the community.

But the clinic fears that a big, non-local buyer could change the relationship between the hospital and the clinic, which employs nearly all physicians in town and offers affordable, frontline care to residents in Shelby and parts of a four-county region.

The clinic, which employs about 55 people, rents some space from the hospital, providing primary care, and also has the contract to provide emergency-room services.

The proposed bidding documents say any entity buying the hospital would have to “assume or renegotiate the contracts and leases” with the clinic.

Brownell says she and her staff are worried that a new owner could decide it doesn’t need or want what the clinic provides, ultimately reducing access to local, primary health-care services.

A better option might be to create a local nonprofit entity to take over the hospital, she says.

Stewart Kirkpatrick, a Billings lawyer representing the county in the sale process, told MTN News that any entity could bid on the hospital, including the clinic – but that the county can’t just give away its assets.

And, the draft proposal for bids is still a draft, he added.

“We’re hoping to get a robust discussion (on Wednesday) on what the future of health care in the community will look like,” Kirkpatrick said. “We want to make sure everyone is on the same page.”

Brownell said the clinic might not be able to afford to bid on the hospital, or take on its debt.

“It’s potentially changing our whole health-care delivery model by having (the hospital) up for sale,” she told MTN News. “We want to work for our community and deliver care our community is looking for.”