Texas taxpayers fear bailout for failing rural hospital

Austin

LA GRANGE, Texas (KXAN) — On a rainy Tuesday evening, dark clouds hang over St. Mark’s Medical Center in La Grange, but it’s been gloomy for years at the facility. 

Over the past six years, 21 rural hospitals have closed in Texas, more than any other state during that time period. 

St. Mark’s is hoping local taxpayers will support their hospital so it can avoid that same fate. 

“Rural healthcare in the United States is in distress,” said Mike Corker, the vice chairman of the St. Mark’s Medical Center Board. “Rural healthcare in Texas, especially, is in distress. The fact that the costs continue to rise but the reimbursements are in a downturn makes it hard for rural hospitals to survive.” 

Despite failed attempts to woo potential buyers, re-budgeting and implementing layoffs, the La Grange hospital is in deep financial trouble. 

According to documents obtained by KXAN, St. Mark’s has had a consistent decline in patients over the years and has over $14 million in long-term debt.  

The hospital’s solution: a Fayette County Hospital District. It works much like a school district and taxes homeowners in Fayette County. 

If approved by voters, the anticipated rate will be 10 cents per $100 valuation of taxable property. That’s $175 per year on a $175,000 home. 

But the tax rate could go even higher. The proposed tax cap for the Fayette County Hospital District is 25 cents per each $100 valuation of taxable property. The amount cannot be increased beyond 25 cents without an approval by voters.  

Early voting began on May 28 and will continue until election day on June 13. 

Funding from the tax district board will go toward equipment for the hospital, recruitment of physicians from the around the country and working capital to pay off previous debts. 

“It’s not that the community doesn’t want to support the hospital. That’s not true. They just don’t feel that putting another tax on the back of the taxpayers is the way to go,” said Ken Dernehl, a member of a group called Concerned Taxpayers of Fayette County. “At this point, we are in the dark as much as anybody else.”

Opponents of the hospital district believe the hospital management hasn’t been transparent with voters on the true financial situation at the hospital. They say the hospital district is a bailout, when the hospital should be finding a long-term solution. 

“The taxpayers feel that the burden is being put on them when there has been mismanagement over the years,” Dernehl said. 

There are other hospitals nearby, but Corker said they lack the level of care that St. Mark’s offers. For comparison, Smithville Regional Medical is the closest to La Grange. It’s 18 miles west on Highway 71. A person can also get to Columbus Community Hospital less than 30 miles to the east. If need be, St. David’s Bastrop ER is 35 miles from La Grange. 

A CDC study released a couple of years ago looked at deaths from an unintentional injury, like a drug overdose or a car crash. 

Those deaths were 50 percent higher in rural areas than cities. One of the big reasons: the distance to trauma care centers. 

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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