Despite Losses & Staffing Shortages, Candler County Hospital Authority Bumps CEO Salary by $75K

The top official at Candler County Hospital received a $75,000 pay raise as the hospital routinely experiences operational losses, staffing shortages due to low pay and low morale, and a tug-of-war with the state’s transparency laws. Worse, the Metter hospital, governed by the Candler County Hospital Authority, has seemingly approved the raises first in secret and then in conflict with the very contract it offered the CEO some two years ago.

CEO Salary

In December 2019, Candler County Hospital in Metter entered into an employment agreement with first-time hospital CEO Michael Purvis for the facility’s top administrative position. The contract set Purvis’ annual salary at $155,000, according to a non-executed document provided to TheGeorgiaVirtue.com by legal counsel for the hospital authority under the Open Records Act. That contract also outlines salary increases at the hospital authority’s discretion following end of year annual reviews, annual bonuses ‘paid in cash,’ and requirements that any changes to the contract be made by October 31 of ‘each calendar year [the] Agreement is in effect.’

After two years on the job, that salary increased by $75,000. According to meeting minutes from the Candler County Hospital Authority’s April 2022 meeting, Purvis’ salary now stands at $225,000 annually. 

Of note, no set of hospital authority meeting minutes reflect an evaluation of Purvis or a pay increase based on such an evaluation in all of 2020 or 2021. July 2020 meeting minutes do, however, show that Purvis proposed enacting ‘Core Values’ for CCH, the last of which was ‘Cost-Effectiveness – Exceptional care for the best value.

The Candler County Hospital Authority voted to increase Purvis’ pay after it was discovered that the authority violated the Open Meetings Act by voting on the matter in a closed executive session in December 2021. Members, upon learning that of the violation of state law, again voted for the raise in an open meeting five months later. The retroactive effective date, while in compliance with state law for open government, appears to remain in conflict with the initial contract of Purvis which requires pay increases to be determined by October 31.

That increase is not the first for Purvis either. Pay stubs for Purvis obtained through the public records request show an increase in pay between Purvis’ hiring salary, October 2020 pay stubs, October 2021 pay stubs, and April 2022 pay stubs. 

Financial Position of Candler County Hospital

The increase in pay, however, does not appear to be driven by the hospital’s stability. When Purvis joined the CCH team, the hospital’s outlook was promising. In January 2020, the CFO report for the hospital showed a 39% increase in gross revenue and while the hospital reported a net loss of $362,000, it was a vast improvement over the 2018 net loss of $1.9 million. In February 2020, CCH showed operating and overall profits.

In March 2020, understandably things changed for hospitals everywhere, however the federal infusion of funds began almost immediately. According to meeting minutes, some of the funding CCH received includes: 

• $90,000 in April 2020 from Georgia Small Hospital Grant
• $1,471,800 PPP Loan (assisted with $1 million decline in outpatient revenue loss)
• $145,000 in Indigent Care Trust Fund money in March 2020
• $3.5 million from Congressional relief bill
• $230,773 in PPP-HHS-CARES in March 2021
• $117,682 in CARES Act funding reported in March 2021 on April 2021 minutes
• $800,000 in a rural stabilization grant (which was presented in detail in executive session in June 2021)
• $258,000 grant through the State Office of Rural Health in late 2021

While HHS-Stimulus-PPP funds and Georgia Heart donations for rural tax credits are listed as ‘Nonoperating Gaines,’ and those funds showed a profit since there are no accompanying expenses with the line items, the hospital reported month-over-month losses for operations in January, February, March April, May, and July 2021 and again in February and March of 2022.  Those are detailed in the Trending State of Profit & Loss Report for all of 2021 and YTD 2022 obtained under the Georgia Open Records Act. (story continues below)

Most interestingly, the report shows that in the same month the Hospital Authority voted to increase Purvis’ salary, the hospital showed a $1,080,737 year-end loss from operations. 

The Hospital Authority stopped reporting losses on the monthly meeting minutes beginning in January 2021 and much of the financials are discussed away from the public view. The meeting minutes reflect minimal discussion of anything outside of the financial reports provided by the CFO.

In March 2021, Authority Chair Brian Wood asked administrators why the hospital was showing a $235,000 loss in February 2021 financials. The minutes read: “Will (Bennet) explained how we report funds, Co vid pay, salaries are up, expenses are up, purchase services up, etc. Will to explain and discuss more in Executive Session.”

Under Georgia law, however, such a subject is not permissible for closed session out of the view of the public.

Candler County Taxpayers Prop Up Hospital Beyond Agreement

Thanks to a provision approved several years ago, Candler County dedicates one mill to the hospital to prop up the hospital. Annually, Candler County Commissioners appropriate approximately $250,000 from the county coffers to the Candler County Hospital Authority, which in turns helps fund the hospital operations. 

Candler County Hospital also has a host of bonds, on which the hospital is supposed to make incremental payments. However, the hospital has not been making the payments as agreed and has instead deferred to the county commissioners. Because the county is statutorily on the hook for the bonds in the event that the hospital does not pay – as is the case in many smaller counties in Georgia – Candler County has been making the bond payments in addition to the appropriated mill.

According to June 2021 hospital authority meeting minutes, the county paid “an extra $200,000 on the Queensborough loan this month.”

Essentially, county taxpayers dedicate one mill to ‘prop up the hospital’ in the amount due to the hospital CEO.

Morale and Staffing

Adequate staffing is an issue for CCH. During the April 2022 meeting, Chief Nursing Officer Linda Coleman reported that a nursing shortage remains in effect because ‘competition for staff is at an all-time high.’ Candler County Hospital, however, is not paying its nurses at a competitive rate, which perpetuates the turnover. Meeting minutes reference a small bump in salaries at one point over the last two years, but make no reference to specifics. Nominal notes of appreciation were approved in 2020 when the hospital authority voted to give full-time staff a $50 gift card to DR Grocery and a $25 gift card for part-time staff in May 2020. Later that year, board members approved Christmas bonuses of $100 for full-time staff and $50 gift cards for part-time staff.

During the CEO report for the most recent meeting, Purvis noted that ‘staffing is still a concern in the hospital’ and the meeting minutes state that Purvis told authority members they ‘will discuss more in executive session.’ The issue with executive session and staffing, though, is that it is reserved for specific hiring and disciplinary matters on specific employees or potential employees. The hospital authority is not permitted to go into executive session simply for the purposes of discussing the issue generally. 

The Candler County Hospital Authority meets the third Monday of the month at 6:30 p.m. in the Candler County Hospital Conference Room. 

https://cdn.thegeorgiavirtue.com/wp-content/uploads/2022/05/Purvis-contract-signed-00448752xEEA23-1.pdf