McLeod Health leases Clarendon hospital

The days of Clarendon County having an independent provider of hospital and emergency care are effectively over.

Clarendon Health System Board of Directors approved a lease agreement for the 81-bed Clarendon Memorial Hospital with Florence-based McLeod Health at a called meeting Wednesday, said Board Chairman Jim Darby.

“After a briefing from our legal counsel, the board voted for me to authorize and sign off on a lease agreement and affiliation with McLeod Health,” Darby said.

A top administrator and a local state senator say the state’s refusal to expand Medicaid made the affiliation with McLeod a necessity for the hospital to survive.

In a memo sent to Clarendon Health System employees March 22, which announced the hospital was in discussion with McLeod Health, Chief Operations Officer Paul Schumacher, then the interim CEO, said Gov. Nikki Haley’s decision to opt out of the expanded Medicaid portion of the Affordable Care Act has been detrimental to rural hospitals.

Expanded Medicaid is a provision of the Affordable Care Act which would expand Medicaid coverage to people making 138 percent of the poverty level, which varies according to family size. Without Medicaid expansion, many people who earn too much to qualify for Medicaid under their state’s eligibility rules also cannot qualify for insurance subsidies under the ACA. Because people in the Medicaid gap typically cannot afford insurance or pay medical bills, health care providers generally are not reimbursed for their health care costs.

According to the Kaiser Family Foundation website, kff.org, 123,000 South Carolina residents fall into this so-called “Medicaid Gap.”

Opponents of expansion say that while the costs of the program are presently paid by the federal government, the costs would eventually become an unaffordable burden on state treasuries.

“Based on the information I’ve received from the South Carolina Hospital Association, in the states that expanded their Medicaid programs, those rural facilities are doing quite well financially,” Schumacher said in the March memo. “In the states that have not expanded Medicaid, those hospitals are struggling.”

Schumacher said with less reimbursement and fewer patients who qualified for Medicaid, the hospital was not getting the reimbursement for the care it was providing.

State Sen. Kevin Johnson, D-Manning, said he thinks the affiliation is a good thing but was critical of the refusal to expand Medicaid in South Carolina.

“CHS has really improved their services and the things they offer to the community, but due to the fact South Carolina has refused expanded Medicaid, a lot of small rural hospitals are having a hard time financially.”

He said that is a reason he is a proponent of Medicaid expansion.

“You have hospitals like Bamberg and others which had to close, which is really a hardship for the citizens,” he said. “I applaud the Clarendon Health System Board for forming a partnership with McCleod, which will allow them to continue to operate and provide quality services and possibly provide expanded services.”

He said a lot of rural hospitals will be forced to make the same decision or go out of business.

“We don’t want to have to go to Columbia or Florence and places like that for health care,” he said.

Johnson said when poor, uninsured patients go to the hospital, the hospital is obligated to treat them even if they are unable to pay.

“It is revenue the hospital will never be able to collect,” he said.

Clarendon will be the seventh hospital operated by McLeod Health. Besides its flagship hospital, McLeod Regional Medical Center of the Pee Dee in Florence, it also operates McLeod Health Cheraw, McLeod Health Darlington, McLeod Health Dillon, McLeod Health Loris and McLeod Health Seacoast in North Myrtle Beach. McLeod operates urgent care centers in Florence and Darlington, along with 59 medical practices throughout 15 counties, according to information released by McLeod Health.

Darby said the formal affiliation agreement would likely be completed in July.

Clarendon Health System Board will continue to oversee three nursing homes in the area: Lake Marion and Windsor Manor in Summerton and Lake Moultrie in St. Stephen, Darby said.

“We have successfully gone through a number of very detailed steps developing this relationship and will work to deliver the best quality and diversity of health care to the community,” Darby said.

The lease agreement follows up an a management services agreement the CHS board signed two weeks ago. Darby said then that the hospital would likely be rebranded as McLeod Health Clarendon.

This story was originally published June 10, 2016 at 7:00 AM with the headline "McLeod Health leases Clarendon hospital."