Claiborne Commission gives OK to CCH, Covenant agreement

March 21--By a vote of 20 to one, the Claiborne Commission approved the final draft of the lease agreement that will hand the management reins of the Claiborne County Hospital (CCH) to Covenant Health Systems, possibly as early as April 1.

The clock continues to tick while county officials wait upon the Tennessee Attorney General to approve the transaction. Meanwhile, the commissioners adopted a resolution that allows County Mayor Jack Daniels and County Attorney James Estep III to move forward in closing the deal once the state gives it the thumbs up.

In mid-August of last year, CCH drafted a letter of intent outlining the terms of the proposed transaction to allow Covenant to lease the real property of the hospital from the county for an initial ten year period. Covenant would then have the option to renew the lease for three, five year terms.

In December, the hospital board agreed to reimburse Covenant up to $552,000 so that compliance improvements could be done.

Covenant then discovered additional compliance issues within the hospital's lab and pharmacy that could pull as much as $448,000 of additional funds from the escrow account laid aside for ending revenues.

The final transaction agreement, approved on March 13 by the hospital board of directors, details the way in which Covenant and CCH will handle the Medicare-Medicaid Electronic Health Record Incentive Programs. The agreement also designates just where the county plans to pull funds to pay Covenant for the continued operation of the Claiborne County Ambulance Service.

Once the transaction occurs, the facility will undergo a name change to Claiborne Medical Center. However, Decosimo representative Ken Conner, acting liaison for the deal, has assured the county during the protracted negotiations that not much else will change for at least the first year or so.

Last month, hospital administrator Tim Brown said several Covenant human resource agents were busy interviewing the current CCH employee pool.

Commissioner Jerry Arnwine was the lone 'no' vote.

In a related matter, 11 hospital employees will be penalized when Covenant takes over the facility. The employees, who were hired some 30 years ago, are not yet Medicare eligible. Under Covenant's management, they will no longer be able to work part-time (under 30 hours per week) so that they may keep their hospital insurance coverage.

The full commission learned it has no power to add them to the county's existing insurance policy, since they will no longer be considered county employees.

Estep told the commissioners the proposed resolution was, in fact, an illegal document.

He did say the county could negotiate with the insurance company when the policy renewal comes due next February.

"I think you can negotiate anyway you want, if you're willing to pay," said Estep.

Jan Runions may be reached at 423-626-3222

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