Blount Memorial Hospital filed a lawsuit Dec. 21, 2022, in Blount County Chancery Court asking for the operation of the hospital to be declared independent of the political control of Blount County Commission and the Blount County mayor.
Further, the hospital asked for a ruling allowing it to proceed with plans to sell its Springbrook facility, an establishment opened in 1996 to provide outpatient care and associated healthcare services. The Springbrook facility was built without use of county funds, and it is not licensed as a hospital, the suit says.
Plans call for it to be sold to a prospective buyer for $22.2 million with arrangements for Blount Memorial Hospital to lease it back from the new buyer and continue its operations. The infusion of cash would be used to improve the financial condition of Blount Memorial Hospital, which, like many hospitals across the country, was severely strained by the Covid-19 pandemic.
“An independent Blount Memorial Hospital will benefit the health and welfare of Blount County,” said Dr. Harold Naramore, the CEO of Blount Memorial Hospital. “It is imperative that the hospital operate as an independent entity to continue our mission of delivering outstanding care in Blount County as Blount Memorial Hospital has done for more than 75 years.”
The lawsuit also asks that three members of the hospital’s board of directors, Robert Redwine, Denny Mayes and Scott Powell, retain their positions on the board. On Nov. 29, Blount County Commission, in a special called meeting, voted to remove the trio from the hospital’s board. The lawsuit asserts that the meeting was called in violation of Tennessee’s Open Meetings Act because the public was not provided with advance notice of the meeting.
Specifically, the lawsuit makes these assertions:
- Blount Memorial Hospital’s directors and officers have the sole authority to operate and manage the hospital, and the county and the cities of Maryville and Alcoa and Maryville College possess no authority over the hospital other than the power to appoint its board of directors.
- The county has no authority to remove hospital directors, and the removal of the three directors is invalid.
- The county’s proposed restructuring of the nominating committee is invalid.
- Blount Memorial Hospital – not Blount County – is the legal owner of the Blount Memorial Health Center at Springbrook facility and therefore has the legal right to sell it.
Blount Memorial Hospital was founded in 1946 as the result of state legislation that allowed Blount County to establish a hospital. From the beginning, Blount County stated that it did not intend to operate the hospital itself, but instead would enter into an agreement with a non-profit corporation to operate and manage it. That has been the situation throughout the hospital’s history.
The lawsuit, however, describes a series of recent interactions with Blount County Commission and Blount County Mayor Ed Mitchell that have been erratic and at times in violation of the laws governing operation of the hospital. Mitchell has variously declared that Blount County should get out of the hospital business entirely and, conversely, that it should dissolve Blount Memorial Hospital as an operating entity and establish another nonprofit to operate and manage the hospital.
Blount Memorial Hospital leadership believes, the lawsuit states, “that should the Mayor succeed and BMH be dissolved, the County will not be able to quickly and smoothly create a new nonprofit corporation to operate the hospital and obtain applicable licenses and federal Medicare and Medicaid funding to keep the hospital open, and the County will thus eventually be forced to close the hospital . . . to the detriment of the citizens of Blount County, Tennessee.”
The suit asks that a temporary restraining order be issued to prevent the board members from being removed; prevent the nominating committee from being restructured; and declare that Blount Memorial Hospital owns the Springbrook facility and that it may sell it as planned.
“Blount Memorial Hospital regrets the necessity of taking his action,” said Naramore. “But efforts to work with Blount County and Mayor Mitchell have thus far resulted in controversy and disarray. So we were left with no choice but to seek the court’s intervention for the good of the citizens of Blount County.”
Moxley Carmichael Public Relations provided information for this report.