Williamson Health board launches RFP process to explore sale while preferring independence

The Williamson Health Board of Trustees told the Williamson County Commission on July 14 that it has launched a comprehensive strategic planning process and will issue a request for proposals (RFP) to explore options for the health system, including the possibility of a sale. Beau Butler, chair of the Williamson Health Board of Trustees, read a letter to the commission outlining the plan and stressing that the board still prefers to remain independent.

Why it matters: Williamson Health operates the county—s hospital and other clinical services. Any change in ownership or governance would involve multiple approvals and could affect employees, physicians and county oversight of the health system.

The board—s letter and Butler—s remarks said the health system faces long-term pressures including staffing shortages, inadequate reimbursements from Medicare and Medicaid, rising operating costs and shifts in health-care delivery that could make large capital investments necessary. Butler said the board has "determined that we must consider the sale of Williamson Health as 1 option to ensure the continued excellence and long term sustainability of care for those we serve." He added the board would also continue to pursue options to remain independent.

Beau Butler, chair of the Board of Trustees, read the board—s planned public communications and told commissioners that an RFP would be sent to qualified prospective partners in the coming weeks and that proposals would likely be reviewed in the late fall. "This process, along with detailed negotiations, could take 12 to 36 months," Butler said. The letter said any recommended sale would first be presented to the county commission for approval and would also require review by the Tennessee attorney general and the Federal Trade Commission.

Williamson Health Chief Executive Officer Phil Mazuca highlighted drivers cited by the board—s letter, including reimbursement pressures and the need for capital to support growth of physicians and freestanding services. Mazuca said recent and potential federal and state legislative changes to Medicaid and other programs are among the factors the board is weighing. "There's a lot of moving parts as you know in the health care industry," Mazuca said.

Michelle Simpson, Williamson Health—s chief marketing and communications officer, told commissioners the board—s letter, a press release and an FAQ would be posted on the health system—s website and distributed to employees and the media shortly after the meeting.

Several commissioners asked procedural questions. Commissioner Richards asked where the letter and materials would be posted; Butler and Simpson said the materials will be placed on the health system—s website and in a media package. Commissioner Lawrence asked whether recent federal legislation influenced the decision; Mazuca said the board considered a range of legislative and market pressures but that the decision at this point was to pursue an exhaustive strategic review and not to take any final action.

Board and county officials described next steps: an RFP will be issued; proposals will be reviewed by the board (including county commissioners who serve on the board); if a satisfactory offer is identified and the board recommends a sale, the county commission would vote on that recommendation; any approved sale would then require state and federal review. The board letter said sale proceeds would first be used to retire Williamson Health—s debts and that remaining funds would be placed into a newly formed independent foundation to support health-care needs in the community.

The board emphasized that the decision to begin this process was made by the Board of Trustees and not by hospital management. Butler said the board unanimously prefers independence but has a fiduciary duty to explore options. Mazuca and Butler said they would be available for follow-up conversations with commissioners and with county residents.

The board did not present any final agreements or seek a vote from the commission at the July 14 meeting; the announcement was a report of the board—s decision to begin a strategic review that includes issuing an RFP.