The Graham Regional Medical Center is continuing its transition into a taxing district, and while the newly elected district still has its opponents, interim administrator for GRMC Scott Landrum said that it was one of the smartest moves the hospital could have made to preserve itself.

“It (the added tax revenue) becomes a form of supplemental income for the hospital,” Landrum said. “And what happens in a small community as we all continue the shift from inpatient stays more to outpatient work, and this is everywhere, there is generally a smaller reimbursement on that. A taxing district helps a community keep their hospital... and also federal and state government funding is not what it used to be.”

Landrum added that it’s not just smaller hospitals needing the revenue boost. As an example, he listed Parkland, Weatherford Regional Hospital and John Peter Smith, all bigger hospitals in metropolitan markets, stating that they have all become taxing districts.

Landrum was placed in the temporary administrative job through his employer and GRMC’s consulting firm Quorum Health Resources. Prior to his job at GRMC, he has served as interim administrator for hospitals all over the country. It is partially this diversity of experience that informs his current opinion on taxing districts.

I know lots of small hospitals around the country that are about to close that are not set up as a taxing district,” he explained. “And what that (forming a taxing district) does is it provides some assurances here.”

As GRMC was going through its voting process in an attempt to become a taxing district last year, two other smaller hospitals in the region, Glen Rose Medical Center (the other area GRMC) and Breckenridge Hospital, were also in the process of becoming a taxing district. Both districts passed;
Glen Rose by only two votes with a final tally of 740-738.

Ray Reynolds has been CEO at Glen Rose Medical Center for the past two years, and his opinion agrees with Landrum’s: taxing districts make sense.

“The establishment of a hospital district, and therefore the receipt of tax dollars gives the hospital financial stability above the operating revenue,” he said. “It helps us with certain aspects such as payment of our indigent care, and also provides us with some funds to replace capital items.”

While GRMC set its tax rate at 36.5 cents per $100 of valuation, Glen Rose set its rate at 7.5 cents. The rate for Glen Rose Medical Center was set significantly lower than GRMC’s largely due to the city’s nuclear power plant.

“That makes a significant difference,” Reynolds said. “They have such a large tax basis. The nuclear plant pays over 80 percent of the real estate taxes for the county.”

Despite having a relatively low tax rate, the proposed hospital district in Glen Rose did have organized opposition. GRMC’s proposed district, on the other hand, did not have any organized political action committees operating against it, but it continues to have a vocal opposition.

Read the entire story in the weekend edition of The Graham Leader.