Hospital reducing debt from last crisis
Richards Memorial Hospital, which has been no stranger to recovering from financial crises in its 37-year history, is bouncing back from its latest one with remarkable speed.
“In the past 13 months (since the old Blackhawk Health Care was reconstituted under a new owner) we have been able to retire our liability by 50 percent,” administrator Jeff Madison said.
“In fact, if not for cash flow, we would be financially profitable,” he said.
One of the beneficiaries of the recovery has been the Rockdale Hospital District itself. As part of its complex operating contract with Blackhawk, the district was owed hundreds of thousands of dollars when Blackhawk imploded in fall 2010.
“We’ve already been able to pay back about three-fourths of the amount owed to the district,” Madison said.
DEBTS— Blackhawk was bought out by new owner Kevin Owens of Georgetown in December, 2010, about a month after the rapidly-failing company apparently came within a few days of closing RMH for good.
The new owner then took on the formidable task of paying off sizeable debts.
“That’s what we’ve been doing and we’re on the right track,” Madison said.
Madison, who guided the hospital through a similar crisis after he was first hired in 2003, was brought on board again.
“There was nothing similar in those two situations,” he said. “In 2003, it was a matter of trying new ideas, finding what would work. This time we knew what would work. Blackhawk got away from that.”
First thing the “new regime” did at the start of 2011 was reemploy health care providers who had been terminated by Blackhawk or left of their own volition.
One of those who did not agree with Blackhawk’s change of philosophy and business culture had been Madison who left the company in early 2010.
In July, 2010, about 40 percent of the Richards Memorial Hospital work force was terminated.
That November, Blackhawk closed its Bastrop hospital and RMH was apparently in its crosshairs for closing before Owens stepped in and bought the company.
In December, 2010, Owens told Rockdale Hospital District directors he purchased Blackhawk specifically to keep it from closing Richards Memorial.
BUSINESS—Lots of work, and lots of debt remains.
Madison said sizeable amounts remain to be paid from credit extended to keep the hospital operating and for construction of the Family Care Clinic building.
One unofficial economic barometer at RMH is again trending positive.
The number of vehicles parked on Brazos Street— indicating full parking lots in the hospital itself—is back to its “pre-Blackhawk crash” numbers.