Troubled St. Alexius overhauls its leadership with new CEO

Feb. 19--ST. LOUIS -- After months of supplier lawsuits and problems paying bills, St. Alexius Hospital is shaking up its leadership: The head of the emergency department will take the helm, officials said Tuesday.

The move comes weeks after St. Alexius and its owner filed for Chapter 11 bankruptcy.

Hospital leaders gathered employees Tuesday and announced that emergency room director Sonny Saggar had been appointed chief executive officer.

Saggar takes over the role from Dr. Russell Kraeger, who has been serving as interim CEO. Kraeger said he will stay on as chief medical officer, chief of surgery and chief of the intensive care unit.

Saggar spoke to employees and fielded their questions at the meeting Tuesday.

"I need you to help me," Saggar told them. "I need you to have faith in me, and in yourself, and one another."

He continued: "I don't have all the answers yet, but I will."

Saggar has operated a handful of urgent care clinics throughout the St. Louis region, and became head of St. Alexius' ER in 2015.

On Tuesday Saggar said he wants to increase transparency at the hospital, in part by creating a biweekly newsletter, and an email account to which employees can send questions and concerns.

He said he is trying to find a new leader for the emergency department, although he plans to continue working six hours a week in the ER.

"I think he'll do well," Kraeger said. "I think he's got the capabilities and the drive."

Natasha Crawford, an employee who works in the emergency department, said Saggar has great vision and that she hopes he will be able to revamp the hospital.

Like many hospitals that serve a relatively high portion of low-income patients, St. Alexius has faced financial troubles in recent years.

St. Alexius' previous owner, Florida-based Promise Healthcare Group, filed for bankruptcy in 2018. The bankruptcy court authorized Promise to sell its ownership stake in St. Alexius to hospital management company Americore Holdings in January 2019.

In the past year alone, at least six businesses have filed lawsuits over payment issues with the 190-bed hospital.

In June and July, an inspector for the Centers for Medicare and Medicaid Services made an unannounced visit to St. Alexius. The inspector's report said that failure to pay vendors "resulted in the withdrawal of services that were critical for continued day-to-day operations of the facility."

An unannounced return visit in the fall found the deficiencies corrected, according to a Medicare and Medicaid Services spokesperson.

On Dec. 31, St. Alexius Hospital and Americore Health filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Eastern District of Kentucky.

Americore CEO Grant White also spoke at Tuesday's meeting. He told employees that the hospital is "stabilized," and doing "a lot better now than we were a year ago."

After the meeting, White said, "Our vendor payables are down dramatically from when we bought the place."

White said he wants to finish stabilizing the hospital, and then work on marketing and growing it.

White founded Americore, which bills itself as a health care company focused on "saving and revitalizing rural communities through the acquisition and management of rural hospitals across the United States." Prior to that, he said he was an entrepreneur, and also spent more than 20 years as an investment banker.

In court filings earlier this month, the U.S. Trustee's office, which oversees bankruptcy cases, said White "has not operated the hospitals in a manner that is consistent with public safety and welfare." The filings also said that the FBI had raided White's personal residence and an Americore hospital over two days in late January.

White declined to comment Tuesday on the reported raid at Ellwood City Medical Center in Pennsylvania, but denied that his personal home had been raided by the FBI.

St. Alexius has a main hospital and senior care center at 3933 South Broadway. It has another campus at 2639 Miami Street, which houses other services and the Lutheran School of Nursing. It will soon add substance abuse and behavioral health services provided by Alexius Health, Saggar said.

There will be about 60 inpatient beds dedicated to the new services, which will supplement the hospital's existing psychiatric care offerings, said Scott Frankel, CEO of Alexius Health.

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