Adventist Health System to cease operating Jellico Community Hospital

The company that operates Jellico Community Hospital has announced it plans to cease operating the hospital in the near future.

The Jellico Community Hospital Board of Directors has approved this week a measure to have Adventist Health System (AHS) assist the City of Jellico in identifying options for a new partner to operate the hospital – “a partner that is better positioned than AHS to make this hospital a success in today’s challenging health care environment,” according to a press release issued Friday morning.

AHS has decided to exercise the right to end its current lease agreement with the city and the hospital Board of Directors, providing one-year notice to allow ample time for a transition. AHS will provide financial assistance to help the city with consulting expenses to aid in determining the best future for the hospital.

The city of Jellico owns the building where the hospital is located.

The move comes as a surprise as AHS completed, in recent years, millions of dollars worth of renovations to the hospital’s emergency department and maternity ward. Last year, the hospital celebrated a $3.6 million overhaul and expansion of its emergency department. AHS provided over $2 million in funding for the renovation.

In March, the hospital was recognized by the Tennessee Hospital Association for patient safety and for efforts to reduce the number of elective early baby deliveries.

About half of the hospital’s clientele reside in Kentucky.

“Clearly, the changes brought on by health reform are requiring us to move in this new direction,” said Rich Reiner, CEO of Adventist Health System’s Multi-State Division. All hospitals today are being called on to deliver higher quality care at a lower cost. Hospitals like JCH, which are ‘islands’ in their market without connections to other nearby health facilities, face even tougher challenges because they have limited ability to share costs and reduce overhead.

“The unfortunate reality is that AHS, with no other hospitals in the region, is no longer the optimum partner for JCH in this changed environment,” said Reiner. Ideally, JCH should be operated by an entity that has other health facilities in the area. This could create cost-efficiencies and shared savings, and could give JCH patients access to hard-to-recruit physician specialists from nearby areas.

“I want to assure the community that we will remain focused on delivering high quality care and ensuring a smooth transition,” said Erik Wangsness, CEO of Jellico Community Hospital. Patients and families will experience no changes during this period of transition.

“Without a doubt, this is a very difficult decision to make. AHS has been part of this community for 40 years,” said Wangsness.

“We want this hospital to succeed. AHS is committed to working with the city in the coming months to ensure that we help put the hospital on a path to be financially strong and healthy, so it can go on providing vital health care services to this community.”
Employees of the hospital were notified of the move Thursday morning.

Jellico Community Hospital also operates a “CarePlus Center” in Williamsburg which “specializes in diagnostics and imaging; physical, occupational, speech therapy; work health solutions; after-hours clinic.”

A similar CarePlus Clinic opened at Whitley County High School last year after funding cuts forced the discontinuation of school nurses in the school system by the Whitley County Health Department.