Selling Community General

As Community General Hospital approaches its thirty-second year of operation, its once bright future appears dim. Public support, medicare cost reimbursement, and private insurance have always been sufficient to keep the facility in reasonable working order. With medicare now using DRGs for determining payments, however, the hospital is being forced to reduce its costs. Complicating matters is the deteriorating physical plant, the growing public concern over hospital operations, the declining census, and competition from a larger, newer, better equipped city hospital. County officials are now faced with a dilemma: issuing bonds to either build a new facility or to renovate the existing structure. If such bonds were issued, the problem then becomes how to repay them. As an alternative, county officials have decided to investigate selling the hospital. The above scenario faces many public hospitals. Sooner or later, public officials will have to consider selling the hospital. This article's purpose is to explore those topics that relate to this decision.