The hospital was a force holding the community together. Without it, I think this community probably will disintegrate

By Shelby Livingston

Rural Tennessee town feels the downstream effects of its only community provider shutting its doors.

DUCKTOWN, Tenn.— Behind the padlocked doors of Copper Basin Medical Center, the hallways are dark and cold. There’s no power. The light shining through the windows reveals an eerie scene: Hospital beds are stripped of sheets now collected in garbage bags. The small pharmacy’s shelves are empty. Boxes of medical supplies line the halls. IV pumps crowd one room; vital sign monitors stand in another.

The critical-access hospital’s equipment and supplies were arranged this way for buyers to pick over at auction. Ducktown and Polk County officials have scheduled a mid-June foreclosure sale for the hospital, located in the southeastern corner of the state. It permanently closed its doors in October 2017 after a harried search to find an investor and failed crowdfunding campaign.

They also have no walk-in clinic or urgent-care center. As the hospital—the area’s biggest employer—slowly wound down its operations, 150 people lost their jobs and many were forced to find work out of town. Local businesses are feeling the impact too, and some residents fear the closure will hasten the demise of the tight-knit community.

“The hospital was a force holding the community together,” said Dr. Mahmood Siddiqui, one of three internal medicine physicians in the area who previously led emergency services at Copper Basin. “Without it, I think this community probably will disintegrate.”

Copper Basin’s story is one playing out in rural communities across the nation. It highlights the challenges independent community hospitals face in an industry where giant health systems only grow larger and payment and regulatory changes leave the little guys in the dust. It also illustrates the difficulties that residents of rural areas deal with when trying to find good healthcare, along with the poorer outcomes and sometimes bigger bills that come from little healthcare access.

“As an 80-year-old, I’m scared,” said Beatrice Tallent, a Polk County resident and former chair of the hospital’s board. “I’ve had one heart attack. It’s a dangerous situation for us elderly people, not to have access to at least emergency care.”

Copper Basin is one of 83 rural hospitals that closed from 2010 to 2017, according to the North Carolina Rural Health Research Program. Tennessee is second only to Texas in the number of rural hospital closures, with eight shutting down since 2012 and another half dozen in deep financial trouble. Part of that’s because of the lack of money and higher number of uninsured patients in rural communities. Tennessee and Texas opted not to expand Medicaid under the Affordable Care Act. There is evidence that Medicaid expansion has helped improve rural hospitals’ financial performance and reduced the risk that they’ll close.

Texas and Tennessee top the list of states with the most rural hospital closures

Source: North Carolina Rural Health Research Program

There are a multitude of factors that led to Copper Basin’s closing. While some were out of the hospital’s control, Copper Basin suffered from self-inflicted wounds, including poor management, many in the town said. Compared with hospitals in metropolitan areas, rural ones, including Copper Basin, have patients who are older, poorer, and either uninsured or enrolled in Medicaid and Medicare plans that pay lower rates than commercial employer plans.

Ducktown’s few residents with commercial insurance typically traveled farther away to hospitals with newer equipment and more services and physicians, rather than visit Copper Basin. So the hospital was left with a money-losing mix of elderly and poor patients. The bulk of Copper Basin’s patient revenue—46%—came from Medicare, while 18% was from Medicaid and 27% from commercial plans (mostly Blue Cross). About 9% of patients were uninsured. In the last year, about four inpatient beds were filled on any given day.

“You can’t make it on Medicare alone. There’s no way,” explained Tim Henry, Copper Basin’s post-closing administrator who was hired as its chief financial officer less than a year ago—too late to right the ship, he said. “Medicaid is worse. Tennessee Medicaid is another story.”

Medicare dominated Copper Basin's patient revenue

Source: Copper Basin Medical Center

Polk, with a population of about 16,750, is one of the poorest counties in Tennessee. The medical center didn’t have the working capital to upgrade its facility or technology and attract higher-paying customers. Though it had started to move to an electronic health record, most patient records were still on paper. The mammography machine was analog instead of digital. It didn’t have an in-house MRI machine, and the CT scanner, acquired in the early 2000s, was outdated. The roof and walls are also riddled with asbestos.

Meanwhile, 200 miles away in Nashville, patients at HCA’s Tristar Centennial Medical Center don’t have to bother with paper, but can instead use tablets to verify information and list symptoms when checking in for appointments.

“If you could go someplace else, you would,” Henry said.

Copper Basin had been losing money for the last decade, going through about nine CEOs in that period. The hospital was built in 1953 with donations that Tennessee Copper Co. miners offered from their paychecks.

Many Ducktown residents are descended from the miners who helped build the hospital, so they feel an emotional attachment. The last copper mine closed in 1987, dealing a blow to the community and local economy, which revolved around that industry.

In years since, the hospital fell into debt—now about $6 million—and was never able to dig itself out. It owes Medicare $600,000 for recoveries since 2012, more than $1 million to vendors, and various amounts on bank loans, which were co-signed by Ducktown, Copper Hill and Polk County in a vain attempt to keep the hospital open. Ducktown and Polk County later decided to take over the loan.

Some employees are still owed several weeks’ pay.

One former administrator, who has since sued hospital board members for her firing, allegedly neglected to pay payroll taxes to the Internal Revenue Service, which has since slapped a lien on the hospital. Copper Basin still owes the IRS close to $600,000 in unpaid payroll taxes from August 2016 through January 2017, Henry said.

“The wheels had been shaking for a long time. They just finally came off,” Ducktown Mayor Doug Collins said. According to Collins, Ducktown’s economy is already being squeezed by the hospital’s loss. The city’s sales tax revenue for 2018’s first quarter was down 7% compared with same period last year, which he blamed on Copper Basin’s closure. The town’s only grocery store, a Piggly Wiggly, closed shortly after the hospital shuttered. One person in town expected the two gas stations to go next.

Ducktown’s approximately 480 residents now face a 30-minute drive for the nearest hospital care: across state lines in Blue Ridge, Ga., and Murphy, N.C. Or they can drive 40 miles through a mountain gorge to Cleveland, Tenn., or trek an hour and a half to Chattanooga, Tenn. Erlanger Health System in Chattanooga also provides an air ambulance service for Ducktown residents needing to be flown out in an emergency.

Some patients say those options are too far away, leading to delays in necessary care. Tallent, the former hospital board chair, suffered from extreme hip pain three months ago. She was alarmed, having broken her hip before. She called Polk County’s emergency services, but its two ambulances were busy. Fannin Regional Hospital in Blue Ridge, Ga., sent an ambulance after getting clearance to pick Tallent up, but didn’t have an orthopedic physician on call; the ambulance ended up taking her another 40 minutes away to a Blairsville, Ga., hospital. The ordeal took hours.

Insurance creates another barrier. Resident Jean Abernathy, for instance, said her Medicare Advantage plan from Blue Cross and Blue Shield of Tennessee won’t cover care at hospitals across the state line, so she’s forced to drive the longer distance to Cleveland or Chattanooga for care.

Town residents complained that Quorum Health-owned Fannin Regional charges much more for services than not-for-profit Copper Basin did.

Tricia Deal, a former Copper Basin employee who now works as a phlebotomist for Pathgroup, said not having a nearby hospital is more than just an inconvenience for elderly patients. Some are putting off care because they can’t travel down mountain roads or don’t trust new doctors.

“Our patients are desperately in need of healthcare,” Deal said. “Most patients grew up here. We were family to them, and they felt safe here. Now they don’t feel safe (going elsewhere) and it’s devastating to them.”

Hospital officials tried to find a buyer and met with dozens of potential investors and hospital operators, but after visiting the facility none were interested. In a last-ditch effort to save the hospital, Henry, the post-closing administrator, launched a Go Fund Me crowdfunding campaign in May 2017 that received some national attention, but raised less than $6,000 of his $100,000 goal. Henry said with its asbestos and faulty circuit breakers, there’s no chance the hospital will re-open. The only item of worth is Copper Basin’s certificate-of-need license, which another hospital operator could use to build a new medical facility.

Ducktown residents are holding on to hope that a system like Erlanger will swoop in to save the day like it did with Murphy (N.C.) Medical Center, a critical-access hospital 30 miles away that Erlanger took over earlier this year. That almost happened in Ducktown, but past administrators passed on the opportunity. A couple of years ago, Erlanger had ongoing conversations with Copper Basin about how to fix its financial issues. Erlanger suggested that Copper Basin officials scale back its services and operate as a free-standing emergency department, said Joe Winick, Erlanger’s senior vice president of planning and business development.

“The leadership wanted to keep the hospital afloat, but we did not see that happening,” Winick said. “They continued to look for others to partner with, with the idea that they could sustain the hospital.”

Erlanger has since applied for a CON to build a provider-based emergency department to serve Polk County and neighboring Bradley County, but it would still be 40 miles away from Ducktown.

Copper Basin is not alone in failing to adapt to changes in healthcare and resisting newer modes of care, such as telemedicine or free-standing EDs. At struggling hospitals across the state, Tennessee Hospital Association President Craig Becker has encountered many communities unwilling to consider alternative models of care.

“There needs to be a medical presence in these communities … but it doesn’t necessarily have to be a full-service acute hospital,” Becker said. “We try to convince (rural communities) to look at another model.” He pointed to Hohenwald, Tenn., which hasn’t had a hospital in two decades but is making do with a facility focused on primary and chronic care that brings in specialists a few times a week, and has a relationship with a regional referral center.

So the future of healthcare in Ducktown is up in the air. Like in so many other rural areas, there’s a need, but the community is still searching for a way. “We know there’s a need for extended hours and weekend coverage,” Henry said. But it’s “got to be a new facility and it’s got to have enough resources and working capital to get people to come there that are going to pay.”

Editors: Matthew Weinstock, Paul Barr and Aurora Aguilar | Copy editors: David May and Julie A. Johnson | Joanne Kim contributed to this project

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