PINEDALE – Applause reverberated through Pinedale Library’s Lovatt Room on Tuesday, Feb. 21, as the Board of Sublette County Commissioners passed a motion, 3-2, to approve the Sublette County Hospital District’s (SCHD) $5.4-million request to fund a shortfall in the cost to construct a critical access hospital and long-term care facility.

The split vote followed more than two hours of intense discussion among commissioners, impassioned public statements and testimonial from the SCHD’s management and construction team.

Commissioner Mack Bradley made the original motion that, “We, as a board, support the SCHD ask of $5.4M today to enable them to carry on with the project.”

Fellow commissioner Tom Noble seconded the motion.

Bradley, Noble and commission chairman Sam White voted in the affirmative while commissioners Dave Stephens and Doug Vickrey voiced the “nays.”

SCHD trustees and administrators appeared before the county on Feb. 7, initially requesting $9.2 million to cross the financial finish line and lock in the estimated $75.2-million price tag for the new health-care campus.

At the Feb. 7 meeting, commissioners declined to take action on the SCHD’s appeal, requesting the hospital district return on Feb. 21 after exploring additional fundraising options.

Over the course of two weeks, the SCHD team reduced the original $9.2-million request to $5.4 million.

On Feb. 13, the Joe Ricketts family announced a $1-million donation to the Sublette County Health Foundation.

By the time the commissioners convened on Feb. 21, the Sublette County Health Foundation had received $15,000 in cash donations and $65,000 in ongoing pledges from community members, said Tonia Hoffman, SCHD Board of Trustees chairwoman.

The U.S. Department of Agriculture (USDA), the federal agency awarding the SCHD’s $32-million rural development loan, gave its “blessing” for the hospital district to place an additional $1.5 million in cash reserves toward the project, Hoffman told commissioners on Feb. 21.

The SCHD team made the “difficult decision” to temporarily shelve completion of a “surgical shell” for a proposed surgical suite, Hoffman remarked, resulting in a further reduction of $1.3 million in costs.

Hoffman stressed the district’s desire to pursue funds to add the surgical shell back into plans for the hospital at a later point to capture future revenue.

The $5.4-million grant from the county will allow the SCHD to close on its $32-million USDA loan. The funds will also enable Layton Construction, the SCHD’s general contractor and construction manager, to determine a gross maximum price for the project. Once the gross maximum price is established, subcontractors are contractually bound to operate within the budget provided in their original bids.

Hours after the commissioners adjourned, Hoffman expressed deep gratitude to the county at the SCHD Board of Trustees’ meeting in Marbleton on the evening of Feb. 21.

A case of need

Layton Construction put the health-care campus project out to bid in July 2022. Approximately 130 subcontractors submitted bids for various aspects of construction by August, totaling $80.2 million, a significant increase from a pre-pandemic estimate released in February 2020 of $54 million for the project.

In spring 2020, COVID-19 disrupted the global economy, international supply chains and labor market. Inflation peaked in September 2022.

A robust commercial construction market stretched subcontractors thin after the pandemic, causing severe worker shortages in certain trades and industries, compounding spiraling costs.

An aggressive round of value-added engineering shaved $5.4 million from the project cost in August 2020. In December 2022, the Wyoming State Loan and Investment Board awarded the SCHD a $10-million grant in federal American Recovery Plan Act dollars for health-care infrastructure.

By Feb. 7, the SCHD raised $66 million, or 88 percent of the total project costs, through loans, grants, a $20-million pledge from the county for a new Sublette Center and $2 million of the SCHD’s own cash reserves.

The SCHD is under pressure to begin construction this spring. Delaying the project for a year could force the district to rebid the entire project, putting it at the mercy of unstable prices and labor markets.

The SCHD submitted an application for additional loans from the USDA to cover inflation. The application was pending and remained an “unpredictable” option, said Dave Doorn, SCHD administrator, on Feb. 21.

Additional loans could also negatively impact the district’s debt-service ratio, Hoffman added.

Hoffman reiterated the district’s long-term goal to become self sufficient from tax revenue and merge health care in the county under a single umbrella.

“Bringing the (Sublette Center and SCHD) together maximizes our revenues and will make us stronger,” she added.

Mike Hunsaker, chief operating officer for the SCHD and its management partner, Star Valley Health, emphasized the crucial role the critical access designation will play in boosting the district’s income through Medicaid reimbursement.

Federal legislation passed in 1999 allowed critical access hospitals with fewer than 25 beds to take advantage of better Medicaid reimbursement rates, Hunsaker said. He projected a 22-percent increase in revenue from Medicaid reimbursement once the SCHD transitions from a clinic to a hospital.

Commissioners speak against SCHD’s request

Vickrey stated that he was an “advocate” for “everybody in this county” rather than a “single entity,” and that he spoke for “the 2,143 people who said ‘no thank you’” to the ballot initiative establishing the SCHD on Nov. 6, 2020.

Voters in Sublette County approved the formation of the SCHD, granting it the ability to levy property tax to build a hospital and long-term care facility, by a 60-percent margin on Nov. 6, 2020. According to unofficial election results posted by the Sublette County clerk, 2,856 votes were cast in favor of the ballot initiative, with 1,895 against.

Vickrey faulted the SCHD for failing to exhaust all its financial options.

“The hospital district brought this project forward, and it’s their responsibility (to fund the project), not the commissioners,” he said. “They have their own elected board and their own revenue stream. They have not, in my opinion, taxed everything they could to get the monies they are needing. They have not asked for a bond issue, they have not asked for a mill levy.”

The SCHD currently levies 3 mils. State statute prohibits the hospital district from raising taxes to the maximum of 6 mils without voter approval in an election.

Granting the SCHD the funds would only encourage the district to return to the county with new financial requests, Vickrey argued.

“If you give money for this project, down the road, it’s going to be an ongoing thing,” he said. “It’s just the way government entities work – they continue to ask.”

Vickrey questioned the “sustainability” of the critical access hospital as “small rural hospitals shut down” across America.

The county had a “fiduciary responsibility” to protect taxpayer dollars, Vickrey said. The county’s $20-million investment in the Sublette Center was “adequate,” and he remained unwilling to “commit any more.”

The Sublette Center’s future was a concern for Vickrey. According to Vickrey, when small hospitals become financially insolvent, the “nursing home” unit is typically the first casualty when cuts are made.

People understood the risks of moving to Sublette County, Vickrey added. New residents arrived “for the right reasons,” seeking a community free of crime and big-box stores.

“We don’t have a hospital, and we haven’t had one for years,” said Vickrey.

While “95 percent” of the people present at the meeting “supported” the SCHD’s request, Stephens said he had received plenty of emails and phone calls that “went the other way.”

Stephens’ primary issue was protecting the county’s reserve fund.

“The bills we have here at the county are astronomical – they keep going up,” he said. “We’re faced with putting in a new cemetery that is going to cost $3 million. I’m concerned about our reserves. It looks like we have a lot, but most of it is committed.”

The SCHD could have started its fundraising efforts “sooner,” Stephens added.

Commissioners speak for the SCHD’s request

The decision to grant the SCHD additional funds weighed “heavily on my mind,” said Bradley. He understood the arguments against assisting the SCHD in closing its deficit.

“We’ve heard (these concerns) today – staffing, low population, huge debts – all concerns,” Bradley said. “However, health care in Sublette County, for the last 25 years, has been a concern.”

Bradley recognized that the SCHD was “elected by this county to lead us in a direction.”

“I think they’re headed in the right direction, surrounded by people that have a track record of coming through in this arena with success,” he added.

Building a hospital and receiving higher Medicaid reimbursement represented the only way to prevent further cuts to services at the Marbleton-Big Piney Clinic, Bradley noted.

“I struggled with those words,” he said. “But perhaps today the time has come. If we as county commissioners wish to build or maintain reserves, I’ll be happy to go down that road, but not at the expense of health care.”

The ask by the SCHD was “minor” compared to “what’s being spent (by the county) already,” Bradley remarked.

Noble voiced full support for the SCHD.

“I’m a huge advocate of this project, and I’m going to continue to be,” he said.

Merging the Sublette Center and SCHD under “one umbrella” paralleled efforts to consolidate law enforcement and firefighting services across the county, Noble said. He cited the “exceptional services” and efficiency provided by the Sublette County Sheriff’s Office and Sublette County Unified Fire.

“The Sublette Center and critical access hospital will do nothing but complement each other,” he stated.

Noble reminded commissioners of the productive negotiations among the county, the Sublette County Rural Health Care District and the Sublette Center in 2018 – “when we sat in the BOCES room and we all saw an opportunity to reset health care in Sublette County as one organization that does nothing but thrive.”

Public opposition

Glen Edwards believed staffing a new hospital and long-term care facility would pose a challenge. He asked whether enough CNAs would relocate to Sublette County to maintain the new Sublette Center.

Without adequate staffing, the new health-care campus would become a cluster of empty buildings, a “ghost town,” Edwards argued.

Mike Crosson discussed sitting through “many meetings” where the SCHD reported a favorable financial outlook. He chastised the district for what he considered to be inadequate fiscal planning.

“There was no indication things were in a bad trajectory and then the sky is falling all of a sudden,” Crosson added. “I don’t know how this happened. Is it poor planning? Is it the board not being completely forthcoming with everything?”

Growth is good for Sublette County, but the county needs to protect its reserves, Crosson said. As energy prices continue to fluctuate, saving funds for a “rainy day” was critical, he continued.

Crosson stated a critical access hospital was “not a true hospital,” but merely a “fundraising model.”

Public comments supporting the SCHD

The Rev. Melinda Bobo, rector at St. Andrew’s in the Pines Episcopal Church, said her parishioners at the Sublette Center and in the wider community will rely on the new hospital and long-term care facility to improve health care.

The merger between the Sublette Center and SCHD will allow the SCHD to “maximize the best bang for the buck” through Medicaid reimbursement once the hospital is operational, Bobo added. Delaying the project carried the risk of increased costs down the road, Bobo contended.

“We need to decide what’s important if we’re going to provide the highest level of care for both our seniors and everybody else in the community,” she added. “But particularly our seniors, because they’re the ones who really need it and have worked so hard their whole lives to get us where we are. They paid some of that tax money. We have an obligation to see that they have the best facilities possible.”

Responding to Vickrey’s comments about the SCHD’s inability to increase tax revenue or issue bonds, voters in Sublette County and the commissioners “made it clear” they did not want additional taxes beyond the 3 mils levied for the hospital district, Bobo said.

Over two weeks, the SCHD came up with $3.8 million, proving the community’s commitment to a new hospital and long-term care facility, Bobo noted.

“People in this county are serious,” Bobo said. “We invite the commissioners to be serious as well. Those funds are in trust, but those funds are in trust to do the work that needs to get done right now.”

Dr. David Burnett spoke as a former commissioner and a practicing physician with more than three decades of practice in Sublette County. He is the SCHD’s medical director.

Five years ago, in February 2018, health-care providers and elected officials from across the county came together to determine “how to move forward” to unify health care as a sustainable entity, Burnett explained.

Access to higher reimbursement through Medicaid would accomplish the goal of providing “all citizens” with adequate heath care and prevent further cuts to the Marbleton-Big Piney Clinic, Burnett asserted.

“We are at a crossroads right now, and depending on the outcome, and on your actions, we can go ahead, or stay where we are or we can fall behind,” Burnett told commissioners.

Improving health-care facilities and decreasing the time spent by Sublette County patients braving Wyoming’s unpredictable roads to seek health care elsewhere were important goals for the “men and women who work out in the (energy industry) fields,” said Paul Ulrich.

Sublette County experienced a substantial improvement in tax revenue for the current fiscal year, SCHD trustee Jamison Ziegler pointed out. Tax revenue received through the SCHD’s mill levy had nearly doubled from the previous year, Ziegler added.

With additional money flowing into Sublette County, Ziegler reasoned that the SCHD’s $5.4-million request would likely come from tax windfall money, eliminating the need for the county to dip into its reserves.

Kelly Tefler worked as a nurse for 14 years. She was employed by critical access hospitals and played a part in the “miracles” the small hospitals provided to rural communities – “to women who are bleeding unexpectedly during pregnancies, to people who have been in car accidents.”

“Having a hospital in Sublette County will literally be life and death for so many people,” said Tefler.

The new hospital will create jobs in Sublette County with better pay and benefits, Tefler added.

“We need this hospital to grow this county and move forward, to not be stuck in frontier medicine. Growth is inevitable, and we all need health care at some point in our lives, whether we’re 30, 40, 50, 90, whether it’s our grandparents or children.”