The information, under Noble Health letterhead, arrived at 5:05 p.m. on a Friday, with the topic line: “Urgent Notice.” Audrain Group Hospital, Paul Huemann’s office of 32 years, was letting employees go.
Phrase travels quick in a small city. Huemann’s spouse, Kym, first heard the unhealthy information within the automobile when a pal who’d gotten the letter, too, texted.
“Your termination was not foreseeable,” said the letter, dated Sept. 8 and signed Platinum Well being Programs, including that the firing was everlasting “with no recourse” and that the “medical facility might be shuttered.”
“I do not know what my subsequent steps are,” mentioned 52-year-old Huemann, who supervised the laboratory on the Audrain hospital.
The longer term for the Huemanns, a whole bunch of different employees and 1000’s of sufferers in two small Missouri cities started to unravel lengthy earlier than that afternoon. The drama taking part in out in Paul Huemann’s hometown is acquainted to many who dwell in rural America: Communities are so determined to maintain their hospital open that they are prepared to gamble on any purchaser, together with these backed by personal fairness.
Typically they lose.
Noble Well being, a three-year-old personal equity-backed startup, had acquired Audrain and close by Callaway Group Hospital throughout the pandemic. In March, it suspended all hospital providers and later furloughed 181 workers, state records present.
Noble — dealing with staggering debt, greater than a dozen lawsuits, and a minimum of two federal investigations — struck a deal to promote the hospitals in April to Platinum Neighbors, which is affiliated with Texas-based Platinum Team Management and Platinum Well being Programs. In late June, Platinum asked Missouri officers to increase till Sept. 21 a deadline to reopen the hospitals.
On Tuesday, Platinum officers advised KHN that, “on behalf of Noble,” they requested Missouri regulators for an extra 30-day extension “in an try to discover all options for reopening these services,” Ryann Gordon, Platinum’s director of selling, mentioned. “The backpay and well being advantages of the staff is of utmost significance.”
Hours earlier than the licensing deadline Wednesday, Platinum submitted a request for a 90-day variance. Missouri rules don’t permit one other extension inside a yr, mentioned Lisa Cox, a spokesperson for the Missouri Division of Well being and Senior Companies. So the state “labored with them” and granted the request, she mentioned.
Platinum mentioned the hospitals want time to finish building initiatives. Audrain’s “emergency room space” has damaged home windows, and Callaway’s hospital wants “vital restore to the plumbing,” in line with the state approval letter. The hospitals can change possession throughout the 90 days, Cox mentioned.
Cory Countryman, president of Platinum Well being Programs, confirmed the termination of the remaining hospital workers. “We’re working with a number of companions to reopen the hospitals,” he mentioned.
That might contain a brand new proprietor. One prospect is Owen Shuler, a Georgia-based entrepreneur, who mentioned he is considering shopping for them. Shuler, who was reached by telephone after he’d visited the agricultural communities, mentioned, “I really like what I see.”
“It is heartbreaking as to what has occurred,” mentioned Shuler, whose corporations embrace Bankers Realty Corp. and Shuler Capital Corp. If he purchased the hospitals, he mentioned, he would accomplish that as managing director of his new enterprise, CareONE World. “When it comes to the due diligence, I don’t like what I am seeing and studying,” he mentioned. What he concluded from his overview is that “personal fairness and enterprise capital have to be stored the heck out of well being care.”
On his LinkedIn profile, Shuler mentioned he “brings a lifelong perspective from a family owned skilled care business” in addition to experience in “telemedicine and healthcare providers.”
Shuler, who confirmed the hospitals had been saddled with substantial debt — “within the ballpark” of $45 million to $50 million — mentioned, “I’m not ready to go on the report about enterprise technique fairly but.” He mentioned his method can be “holistic” and embrace telehealth. Many trade leaders have argued telehealth is a solution to deliver high-quality medication to rural communities that may’t afford, and do not want, a full platoon of specialists on-site.
“Our goal is buying hospitals in rural and deprived areas and introducing our capabilities to them,” Shuler mentioned, including that fixing the 2 “mainly damaged” Missouri hospitals from the underside up can be “a lot simpler than making an attempt to enter a wholesome system.”
Nonetheless, it is unclear whether or not Shuler or one other purchaser will come by means of and what it will take to reopen them after years of possession instability and monetary hassle.
Enterprise capital and personal fairness agency Nueterra Capital launched Noble in December 2019 with executives who had by no means run a hospital, together with Donald R. Peterson, a co-founder who previous to becoming a member of Noble had been accused of Medicare fraud. Peterson settled that case with out admitting wrongdoing and in August 2019 agreed to be excluded for five years from Medicare, Medicaid, and all different federal well being applications, in line with the Well being and Human Companies Workplace of Inspector Basic.
Federal regulators didn’t block the acquisition through which Peterson was concerned. “All possession and managing management data is self-reported,” mentioned Facilities for Medicare & Medicaid Companies spokesperson Kristen Clemens.
Skimping on care
It did not take lengthy for issues to floor underneath Noble Well being’s stewardship. Noble has accepted almost $20 million in federal COVID-19 aid funds, together with $4.8 million from paycheck safety applications, in line with public information.
But doctors, nurses, and patients noticed proof that the brand new homeowners had been skimping on providers — failing to pay for and inventory surgical provides and medicines. In Callaway, state inspectors decided that conditions in the hospital endangered patients. Former employees offered KHN payments and pay stubs they mentioned confirmed Noble had also stopped paying for worker well being, dental, imaginative and prescient, and life insurance coverage advantages.
After workers filed complaints about shock medical payments, the Division of Labor’s Worker Advantages Safety Administration launched an investigation in early March, in line with a letter sent to the company and obtained by KHN. The division confirmed a second investigation by one other one among its divisions, Wage and Hour, into Noble’s administration of its Audrain hospital and clinic.
In April, Noble struck a deal to promote each hospitals for $2 and a inventory switch to Platinum, which assumed all liabilities, according to the agreement. In a June 22 letter to state regulators concerning the hospitals’ working licenses, Platinum mentioned, “We’re requesting this continuance as Noble Well being inventory has been transferred to Platinum Medical Administration.”
Whereas visiting the hospitals in April, Countryman advised workers it was a “precedence” to pay the again wages Noble owed them.
Neither Noble nor Platinum made good on that within the months since, workers contend. Along with the federal investigations, 9 wage claims — the biggest for $355,000 — have been filed towards Noble in Kansas, in line with data provided by means of a Kansas Open Data Act request.
By early August, others had been recognizing the worker complaints. Principal, which offered dental and imaginative and prescient care protection, sent letters to employees saying it will not demand that any employee repay advantages the insurer lined after Noble stopped sending premiums for worker protection. “This case is just not typical,” wrote Principal spokesperson Ashley Miller in an electronic mail.
Huemann, as laboratory supervisor, was among the many employees who weren’t furloughed within the spring. They reported for work daily within the hopes that the Audrain hospital would reopen. Huemann checked reagents and stored machines operational at the same time as cash for provides was tight.
“We could not get something,” Huemann mentioned, “so we had been residing with what we had.”
Huemann, who offered pay stubs to KHN, mentioned he acquired a paycheck from Noble in late March. He mentioned he didn’t obtain one other paycheck till late Might. He acquired common paychecks in June and early July. However his second July examine, underneath Platinum, was every week late. His ultimate paycheck arrived Aug. 8 and was additionally late.
His final seven checks got here from three corporations. They had been all on Platinum’s watch: Initially Platinum Neighbors issued the checks, then Callaway County Group Hospital, and at last Noble Well being Audrain Inc.
“Everybody cashed their examine as quickly as they bought it,” Huemann mentioned. “There are such a lot of purple flags. However you recognize, we’re at their mercy, we’ve no management, and we’re nonetheless grateful they’re saving us.”
The examine stubs additionally present the hospital’s operators deducted $1,385 in whole from Huemann’s pay for insurance coverage. The medical insurance coverage was imagined to be with Blue Cross and Blue Defend of Texas, however Huemann mentioned he by no means acquired a card and couldn’t verify protection.
“I known as 4 or 5 occasions on completely different days,” he mentioned. “They might by no means discover me regardless of how they seemed me up, with Social Safety or date of delivery, or something.”
Countryman referred all monetary inquiries to Platinum’s company places of work. Ryan Cole, chief government of Platinum Workforce, didn’t straight reply to calls and emails in search of remark.
Some docs left city because the upheaval swallowed the hospitals.
Others, comparable to household medication physician Diane Jacobi and her nurse practitioner, Regina Hill, joined MU Well being Care, affiliated with the College of Missouri, in Mexico, Missouri, the 11,000-person city the place Audrain Group Hospital is situated.
Jacobi mentioned her sufferers need native care. “I do not know if you happen to’re a mama, however if you happen to’re in labor, the concept you need to spend 45 minutes in a automobile on the best way to the hospital is nerve-wracking,” she mentioned. “It is safer in case you have care.”
Lou Leonatti, an legal professional who lives in Mexico, mentioned he feels so strongly that the group wants a hospital and emergency care that he offered loans final yr to Noble so the corporate may meet payroll. Leonatti’s private $60,000 mortgage, with an rate of interest of about 3%, was due in January however, he mentioned, stays unpaid.
Leonatti helped begin Undertaking Dawn, an area financial improvement group. If a brand new settlement is just not reached, he mentioned, “we want to have a Plan B obtainable.”
Peterson, who helped launch Noble’s failed effort to show across the two Missouri hospitals, appears to have discovered his Plan B in Dubai. “I am sitting within the Emirates Air lounge in Dubai marveling on the expertise being afforded me on the tender age of 68,” he wrote on LinkedIn. “I will be in Riyadh for the subsequent week ending up due diligence on launching a brand new enterprise there.”
The submit made Tonya Linthacum, a nurse practitioner who labored at Audrain’s most cancers screening heart for greater than twenty years, livid. She mentioned that he “destroyed lots of people’s lives and livelihoods,” including that “to have somebody dupe you want that” and “happening with no penalties. It is simply not the best way the world is meant to be.”
Peterson declined to remark.