Hospital sale consultant, supervisor disagree on fund amounts

Published 12:11 am Wednesday, September 17, 2014

NATCHEZ The consultant hired to help sell Natchez Regional Medical Center said Tuesday an Adams County supervisor incorrectly suggested the consultant has been paid nearly $1 million since March.

Supervisor Mike Lazarus said Monday that he was upset that consultant Scott Phillips with Healthcare Management Partners had been paid $745,000 since Natchez Regional’s March bankruptcy filing.

“It’s probably closer to $1 million now,” Lazarus said Monday, explaining later that the figures he referenced were several weeks old and that he estimated Phillips’ firm had accrued additional charges since.

Phillips

Phillips

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Monday’s discussion followed the supervisors signing a $3 million loan to help finalize the sale of the county-owned hospital to Community Health Systems.

Lazarus said the payments were listed on a post-petition payments list he and other supervisors said a hospital official recently showed them.

The Democrat requested a copy of the list from Natchez Regional’s CFO Charles Mock last week, but Mock said he didn’t have it. A formal, written request has not been acknowledged by the hospital.

The post-petition payments list is simply the full list of hospital expenditures incurred after the bankruptcy was filed.

Phillips said Tuesday in an email that the assertion he was paid $1 million or more since NRMC filed for bankruptcy was “patently false.”

Phillips said his firm has been paid a total of $48,579, and that the firm has another $66,883 in fees from June 30 to September for which they have not yet submitted an invoice.

“Also since last October, we have continued to provide services associated with the sale of the hospital, not related to the bankruptcy for which we have not and will not bill any amount above the fixed fee we were paid last year,” Phillips wrote. “For example, I was in Natchez last week for the auction and related matters and did not charge NRMC or the county for any time or expenses for the trip or my attendance at the auction.”

Phillips said the amounts billed by all companies, including HMP, to NRMC since it filed bankruptcy would be filed with the bankruptcy court “as soon as the data can be gathered from all of the firms involved.”

In March, just ahead of NRMC’s bankruptcy filing, county supervisors hired Phillips’ firm to provide financial guidance to the hospital during the bankruptcy at a discounted rate of $460 per hour. He said at the time his usual rate was $675.

In July 2013, the county hired HMP to solicit and analyze sales proposals for the hospital for a minimum of $300,000 and a maximum of $500,000.

“My staff and I are legitimately proud of the services we have provided to the hospital over the years and can point to significant cash benefits received by the hospital that in the aggregate have equaled many times the fees which we have been paid,” Phillips wrote. “I assume everyone, including Supervisor Lazarus, is interested in attracting professionals to work in Natchez that can deliver measurable value for fees paid.”

NRMC filed bankruptcy in late March, in the midst of an effort to sell the county-owned hospital. The sale was officially awarded to CHS last week, though it is pending the approval of the bankruptcy court.

If the court approves the sale, it will close Sept. 30.