City leaders vote to terminate contract with Jellico Medical Center

Local News

JELLICO, Tenn. (WATE) – City Mayor Dwight Osborn confirmed the Jellico Board of Mayor and Aldermen voted Thursday to send a contract termination notice to Rennova Health, the company that operates Jellico Medical Center.

The city owns the hospital.

Osborn did not cite specific reasons for the vote, but said “under the terms of our contract, we believe we have reason to terminate.”

The notice gives the company 30 days to vacate from the day it’s mailed. We asked if the company could remedy any issues and continue running JMC. Mayor Osborn indicated that was not discussed.

The mayor also noted the hospital has dwindled to “very few” employees in recent months and said only the emergency room is available to the community currently.

Osborn confirmed the hospital has not admitted a patient since late November and the emergency room closed at 7 a.m. Monday, March 1.

City attorney Elizabeth Burrell further explained city leaders believe the hospital does not operate, and doesn’t have adequate staff to operate, as an acute care hospital. JMC, she noted, has not admitted patients since Black Friday, resulting in patients being transported elsewhere.

“They just wanted a hospital in Jellico, and they don’t feel the current operators are providing the necessary services needed in Jellico,” Burrell said.

The notice to vacate comes after another letter, dated Dec. 29, which requested changes to Rennova’s operations. They included maintenance such as boiler repair, HVAC, and plumbing. Burrell also said the letter mentioned JMC needed to operate as an general acute care hospital, a requirement in their lease agreement.

Rennova Health CEO Seamus Lagan said the company has recently made investments in a new CT scanner, COVID-19 diagnostics equipment and upgraded to digital X-ray panels, as well as negotiated an agreement to use telehealth services with inpatients.

“It is disappointing to see this information in the press and social media and hope that we can come to agreement with the Jellico Board to resolve the matter,” Lagan said. “We are certainly willing to engage with them and disclose our plans.

“They are aware of the deficiencies in their building and must realize that either they or someone else will have to make the required investment of probably $500,000 or more if the facility is to continue in use as a hospital.”

“We are not aware of anyone other than us committed to making this investment at present, so I fail to see how such a decision by the Board benefits the community or the current employees at any point in the future.

Rennova Health CEO Seamus Lagan

The company purchased the hospital in 2019.

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