Southern Regional Medical Center May Not Survive

Charlie and Alex have each had posts today on the difficulty of financing our healthcare system. Allow me to make it a trifecta by calling your attention to a story that ran in the AJC over the weekend detailing the struggle that Riverdale’s Southern Regional Medical Center is having in staying open in a county where demographic changes are greatly increasing the number of patients who can’t pay, insurance providers are reducing payments, and competition is forcing the hospital to compete for profitable patients.

Last May, Clayton County pumped $50 million into the facility, largely to pay off bond debt. In fiscal 2014, the hospital provided $21.6 million of care for which it wasn’t paid. And maybe that’s reasonable for a facility that handles over 74,000 emergency room visits per year. In the past, much of the shortfall would be made up for by patients whose procedures were covered by traditional insurance. However, competition has reduced the number of those patients:

Day surgery centers opened in the market after the state in 2008 passed a law allowing them to skip the state’s certificate of need process if they are limited to a single specialty. A new orthopedic center was a particular blow, Southern Regional officials said. Doctors who had used the hospital in the past began sending their patients to the outpatient centers, cutting into Southern Regional’s admissions.

Legislation also allowed Cancer Treatment Centers of America to open, 25 miles to the south. And insured patients have their choice of Piedmont Fayette Hospital to the west and Piedmont Henry to the east.

Between 2007 and 2012, Southern Regional reported more than a 50 percent drop in admissions covered by third-party payers, such as private insurance.

There is some good news for Southern Regional. An affiliation with Emory Healthcare and new hospital CEO Kim Ryan, who previously oversaw the growth of Snellville’s Eastside Medical Center, and before that guided Tulane Medical Center through Hurricane Katrina, plus an improving economy provide rays of hope.

For those of us in Atlanta, it’s easy to think of the issues with rural hospitals as something far away that won’t make any difference to us. Yet the difficulties at Southern Regional and the fact that Grady Hospital was recently eliminated as an in-network facility by Blue Cross / Blue Shield make clear that determining the most effective way to deliver healthcare is an issue that should conceern all Georgians.

5 comments

  1. gcp says:

    If the Clayton County wants to keep it open, let the county fund it though it may be best just to let it close. Other metro hospitals have closed so its not unheard of.

    True emergencies will always get treated at other hospitals which leads to the question of how many of the 74000 are emergencies? Other hospitals could handle Clayton patients. Distances are not as great as rural hospitals in South Ga. Dekalb Medical Hillandale which also does not serve a wealthy patient base seems to do o.k. and its close enough that it could handle some of Clayton.

    As for the new ceo, understand the Eastside population is much better mix of incomes compared to Southern.

    • saltycracker says:

      74,000 emergency visits in a year is 200+ a day, that was a shocker. That has to be a systemic health care issue that can not be solved with more money.

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