Lexington Medical Center eyes nonprofit business model

Lexington Medical Center is seeking to become a nonprofit hospital, a step that its leaders say will enable it to continue providing affordable care amid a series of major challenges.

The plan was outlined Tuesday to Lexington County Council, which must approve the change.

It comes as the 49-year-old hospital faces new rivalry with the pending merger of seven nearby Midlands hospitals under the Prisma banner and increased regulatory and financial pressures that could threaten its goal of remaining independent with a focus on local health care.

“We want to keep what we have going strong,” hospital board chairman G. Tripp Jones of Irmo told the nine council members. “”If we don’t, we’re going to hit some turbulent waters.”

Lexington Medical Center is one of the few government-created hospitals left in South Carolina, with many others already nonprofit, officials said. Its network includes medical facilities in Batesburtg-Leesville and Gilbert.

It has grown from a small local operation into a regional force in health care with a staff of more than 7,000.

The status change sought would allow the hospital to finance debt for improvements more cheaply, reduce pension costs, increase its investment yield and expand services through new partnerships, hospital president Tod Augsburger said.

Without it, the hospital’s ability to keep pace with expected population growth will be in jeopardy, he said. Forecasts from the Central Midlands Council of Governments say the county will be home to 500,000 residents in 2050, about 200,000 more than today.

Hospital leaders want to avoid consolidation into a regional chain, a move often forced by rising costs across the board in health care, Mr. Augsburger said. “We’re not going to change who we are,” he promised.

Becoming nonprofit “allows us some flexibility,” he said. “It’s a structural change that allows us to be more competitive.”

It won’t have any impact on patient care and current medical staff, Mr. Augsburger added.

Some council members agree the change is inevitable. “It appears what needs to be done so the hospital can survive,” Councilman Larry Brigham of Batesburg-Leesville said.

Others are sympathetic but want time to understand the ramifications. “This is a lot for us to digest,” Councilman Todd Cullum of Cayce said.

Midlands health industry analyst Emerson Smith said the proposed change may prove a Band-Aid instead of a cure.

It would “buy some time” for Lexington Medical Center to cope with the Prisma merger and other problems ahead, but it doesn’t appear to be a panacea, he said.

If the plan is adopted, county leaders would appoint a nine-member board whose role would be making sure the hospital sticks to its promises of affordable quality medical treatment.

In addition, the hospital would pay an annual rent of $1.2 million initially for the 18-acre site in West Columbia where its headquarters is located.

The goal of being “accountable only to the people we serve” remains the same amid all the changes envisioned, Dr. Jones said.

By its count, the 508-bed hospital treats 85,000 emergency patients, performs more than 23,000 surgeries and delivers more than 3,300 babies yearly. It also completed a $400 million expansion last year.