County loans troubled Tonopah hospital $2 million

Nye County commissioners Tuesday voted unanimously to loan up to $2 million in revolving credit on an as-needed basis to Nye Regional Medical Center in Tonopah.

County Commissioner Frank Carbone said not approving the credit would leave residents in that area without hospital care. The funds will come out of a health endowment fund built up by the Payment Equal to Taxes the U.S. Department of Energy formerly paid Nye County for the land value of Yucca Mountain.

“We’ve been involved in a very complex, complicated bankruptcy action now for several months and obviously our goal number one throughout has been to ensure that that hospital remains operational because it is the only medical facility that covers basically all of central Nevada. So it’s vital to the area,” District Attorney Brian Kunzi said.

Kunzi proposed loaning the hospital $2 million as a revolving loan on a monthly basis to meet any financial deficiencies. The commission needed to take action before a hearing in bankruptcy court next week, he said.

“It would be on a long-term loan basis with a 2 percent interest rate, the payback is actually more than what we’re getting on our current investments,” Kunzi said. He said originally they were going to loan $250,000 as the county’s contribution to the bankruptcy plan but to keep the hospital operational they need to have a capability of using a $2 million loan cap.

“It’s to the point now we need to ensure the court has the knowledge that there is a financial backing of this hospital because otherwise the only option is that we liquidate and when we liquidate there is no hospital and no licenses and nothing else,” the DA said.

“It is a belief and from my memory a situation like this is exactly what the endowments were set up to do and that’s to provide this kind of benefit to the taxpayers of Nye County,” Commissioner Lorinda Wichman said, who is from Big Smoky Valley. Wichman said recently she decided to be transported to Nye Regional Medical Center instead of two and a half hours north to Fallon and was impressed by the new professionalism.

Tonopah Town Manager James Eason said the closest hospital to the north would be Mount Grant Hospital, which is 110 miles away in Mineral County, the closest to the east in White Pine County is 169 miles, the closest to the south is Desert View Hospital 165 miles away in Pahrump and the closest to the west is Bishop, which is 118 miles.

“This is a good bet for the county for the people who live in that area. Obviously it’s money well spent but it’s a revolving fund if I’m not mistaken,” Carbone said. He wanted commissioners to approve the disbursements, but Kunzi suggested County Manager Pam Webster be given approval to do so.

“It will only go out as it would be requested by the hospital board as part of what is needed to cover whatever deficiency they have, based on a monthly basis to cover their expenses,” Kunzi said.

“Because of our bankruptcy efforts the prior administration of the hospital was completely cleaned out and we have in place a three-person board of which one member was appointed by this board, one member was appointed by Round Mountain Gold and then there’s a third member who’s part of the unsecured creditors committee. We really have two partners, us and Round Mountain Gold, who are very vested in this hospital, who basically have a controlling interest in the operations,” Kunzi said.

Round Mountain Gold donated $250,000.

“The intent is that the hospital run on its own operating income. This is a backup to that operating income. It is not intended to be the sole operating means of keeping it open,” Webster said, asking for and receiving confirmation of her statements from Eason for the record.

Wichman asked for quarterly reports from the hospital. Webster said she’d put that in her regular reports.

Eason applauded a decision by the county commission and district attorney to be involved in the hospital case.

“I know this is a very painful moment when we’re talking about the finances of the hospital but we would not have a position and the hospital would have already been closed,” he said.

Eason said Nye Regional Medical Center saw 13,000 patients last year, small from a hospital standpoint. Of those, 7,400 were from Tonopah, 1,400 from Round Mountain, 1,200 from Esmeralda County, the rest from elsewhere.

“We’ve already seen an increase in people coming back to the hospital,” Eason said.

The new medical chief of staff assembled a team, some doctors have been in the community before, he said. Emergency room doctors from the Veterans Administration and Renown Medical Center are pitching in to help.

“We have signed an agreement for a long-term family medicine practitioner who will be there three to four days a week, which is something that has been missing,” Eason said.

Commissioner Donna Cox wanted it clarified it’s a loan up to $2 million.

“It’s our job to oversee the health, safety and welfare of the people and there are several thousand people up there apparently who are in need of this,” Cox said.