OKTIBBEHA COUNTY – County officials have taken the next step and are now exploring the possibility of selling or leasing the OCH Regional Medical Center.

Minutes after the board meeting began on Monday, the board went into closed session to discuss a feasibility study for the hospital that it commissioned from Raymond James Financial Services in April. When the board emerged from closed session, they voted unanimously to schedule a public hearing on the sale of the hospital for Sept. 19. The hearing is scheduled for 5:30 p.m. in Chancery Court.

“Once we make the decision to proceed with the review of the sale of the hospital, we are required by law to schedule a public hearing and inform the public of our intentions,” Board President and District 3 Supervisor Marvell Howard told The Dispatch on Tuesday.

The study, now available on the county’s website, includes information on the hospital’s revenue, debt profile, capital expenditures, utilization, nursing staff and retention, revenue losses and more.

According to the study, the hospital’s total operating revenue increased from $64.2 million to $69.1 million between 2020 and 2023. Last year, the hospital had operating revenue of $79.7 million, according to the study.

However, the study attributes the increase to additional Medicaid payments the hospital received through the Mississippi Hospital Access Scheme, which increased by $7,224,512, or 232.8 percent, over the past five years.

According to the study, these additional payments have resulted in a positive operating margin for the first time in recent history, but without them, OCH’s operating margin would be negative. The study says it is “unclear” whether the increased MHAP payments will continue after fiscal year 2025.

The Raymond James report recommends that OCH find a “strategic capital partner” to ensure it has access to resources to expand its services and meet current and future capital needs. This could best be achieved through a sale or lease, it says.

Howard said he voted to proceed with the public hearing to examine the sale based strictly on the data presented to him. He said the report showed the challenges facing OCH, but also identified some “bright spots.”

“When we started this process, I just wanted to be guided by the data and just wait and see what the data said and what the projections were and things like that,” Howard said. “That’s what led me to cast my vote so we can move forward with the exploration of a potential sale of the hospital.”

1st District Supervisor Ben Carver told The Dispatch that bringing in a partner could help strengthen the hospital financially while reducing some of the risk to taxpayers.

“Hospitals will always be around … but stand-alone hospitals may be a thing of the past,” Carver said. “We are evaluating whether we can maintain world-class health care even if taxpayers bear all the risks and the volatility of the market.”

Carver also mentioned the report, pointing out problems with staffing the hospital with nurses and doctors. As of September 30, 2023, OCH had 131 physicians as part of its licensed medical staff, including 35 as primary admissions staff.

District 2 Supervisor Orlando Trainer said other concerns raised during the presentation included loss of revenue as patients left the district to go to other hospitals.

The study shows that the hospital loses Medicare revenue compared to its five largest competitors, but attributes nearly 50% of those losses to Baptist Memorial Hospital-Golden Triangle and Baptist Memorial Hospital-Memphis. Trainer attributed those losses to other hospitals that provide services that OCH cannot offer.

“If OCH doesn’t offer these services, you have to go where they do,” Trainer said. “But if there’s a way for us to offer these services here and keep the money here locally, then that would be a win-win situation for everyone in the county.”

Trainer also supported the sale of OCH in 2017 before voters rejected that measure at the ballot box. After the election, OCH chose to partner with the University of Mississippi Medical Center to expand its services and increase its medical staff.

However, Jackson said in July he did not believe OCH benefited greatly from the partnership. The study also shows that the partnership did not prevent OCH’s significant loss of revenue to UMMC.

“OCH Regional Medical Center has been a cornerstone of health care in our community for decades, providing compassionate and world-class medical care to our friends and neighbors,” Jackson said in a text message to The Dispatch on Tuesday. “Although the Board of Directors has decided to take steps to sell OCH, our unwavering commitment to providing exceptional care remains.”
Regardless of the outcome, we are committed to continuing our mission and serving the people of Starkville, Oktibbeha County and beyond with the same quality and care they trust.”