Lakeland Healthcare reports $30,000 shortfall after malpractice carrier drops contract

Lakeland Healthcare Center officials notified the Board of Trustees on Oct. 19 that the facility's medical malpractice insurer declined to continue contracting with the nursing home, creating a roughly $30,000 shortfall that the center expects to cover with operating savings and then reimburse from the county's risk-management account.

Carlo, a facility staff member who presented the item, said the center had already paid for a replacement policy out of the county risk-management account but budgets individually at Lakeland and therefore needs to replenish that account. He told trustees the carrier's decision was "directly related to our 2023 survey." Carlo said the shortfall will require a budget amendment; staff told trustees they expect to return with either a resolution or a formal budget amendment in March or April.

Trustee Brian Holt asked whether the carrier gave a specific reason for dropping the facility; Carlo replied it was linked to the 2023 survey and noted a separate civil money penalty (CMP) remains under appeal and has not been billed. Carlo said some payroll savings from unfilled positions are expected to cover the deficit in the near term.

No formal action was taken at the meeting. Carlo said the policy chosen is more expensive than the amount budgeted for 2025 and that the center will reimburse the county risk-management account after using operating savings to bridge the difference.

The item was informational; trustees were told they would hear about the matter again at the county finance committee and that staff will return if a formal budget amendment or resolution is required.

Trustees approved routine agenda items and minutes earlier in the meeting; no vote was taken on the insurance shortfall itself.