Santa Cruz Valley Regional Hospital

Santa Cruz Valley Regional Hospital is making “pretty good progress” in catching up on its bills, with most of them less than 90 days late now, CEO Kelly Adams said Tuesday.

“We’re trying to make sure we’re paying them as fast as the money comes in,” Adams said. “I think we’re in good standing with all of our vendors. We’re communicating with them all of the time...our vendors have been very willing to work with us.”

In January, after news broke that a group of doctors filed a lawsuit against the hospital claiming they were owed $1.9 million, several past and current hospital employees contacted the Green Valley News claiming the hospital was in dire financial straits again.

The hospital exited from bankruptcy in July, but medical professionals and others associated with the hospital said it continues to suffer from immense financial problems that have unpaid vendors at the door, supplies running low or out, and patient care suffering.

Adams acknowledged in January that the hospital owed money to vendors but said it is “financially solvent,” patients continue to receive exemplary care, and supplies on hand are “adequate.” He said he was not certain how many vendors were owed money, but said he thought the hospital would be caught up on its bills by early March. Now, Adams said it might be late March before the hospital is caught up.

Adams is founder and partner of ERH Health Care, a Salt Lake City company that helps underperforming and distressed healthcare organizations. He was brought in last summer as the hospital's fourth CEO by Lateral Investment Management, which now owns the hospital.

Adams said the hospital fell behind because the hospital switched to a new electronic medical records system in November, which resulted in bills being processed late and a slowdown in revenue, he said.

On Tuesday, he said hospital staff and doctors continue to train on the medical records system. He called it a “complicated system” involving hundreds of line items and demanding hours of training. About 95 percent of the training has been completed, however, he said.

Adams continues to maintain he doesn’t know how many vendors the hospital has, how many are owed money or the amounts owed. However, he said the progress in paying them is evident.

“I would hope by the end of March we’ll be in much better shape,” he said.

Patrick Feeney, managing director of Lateral, did not return a phone call seeking comment Tuesday. As of January, he said the hospital had the company’s “full financial support.”

Global Hospitalist Solutions signed a contract in January 2018 to care for in-patients and signed an additional contract in August 2018 to handle the hospital’s emergency room. The doctor’s group filed a lawsuit in Pima County Superior Court in December alleging the hospital owed the group just over $1.9 million in unpaid invoices. According to the lawsuit, when the unpaid invoices were brought up, the hospital announced it was terminating its contract.

GHS also said hospital officials never raised issues about the quality of services it provided.

The hospital recently filed a counterclaim, saying it did have concerns about GHS’ performance.

The hospital further alleges it was often unable to bill patients because at least five GHS physicians and three mid-level providers were not enrolled as contracted physicians with Medicare and other specific third-party payers. Moreover, the hospital said GHS left 355 patient files incomplete and unsigned from Nov. 1 through Dec. 31, again making it impossible to bill patients.

Kim Smith | 547-9740


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