Starke County approves five-year lease amendment with Knox Hospital; operator to stop OB and some trauma services

Starke County commissioners voted on and approved a second amendment to the lease with Knox Hospital LLC, a subsidiary of CHS, shortening the operator's term to five years with an option to extend and increasing annual rent to $99,675, payable in four quarterly installments of $24,918.74.

The amendment, described to the board as the "second amendment to the lease agreement," also removes certain clinical obligations from the operator, specifically obstetrics (labor and delivery) and Level 2 trauma services, and excludes PHO appointments and Indiana Hospital Association membership from the board's super-majority rights. Counsel explained the renewal and negotiation provisions: roughly 18 months into the five-year term there is a six-month window (between 18 and 12 months remaining on the lease) in which the county must give notice if it wishes to negotiate with alternative hospital systems or to seek extended terms with CHS/Knox.

Commissioners discussed procedural items before the vote, including a minor typographical issue in the document that legal counsel characterized as nonmaterial. A commissioner noted the practical benefit of the extended negotiation window compared with prior contract terms, saying the extra time will give the county more opportunity to consider other health-care providers. The motion to approve the lease amendment was made on the record and approved by voice vote; participants characterized the passage as unanimous, though the transcript does not include a full roll-call tally.

Board members also approved a side letter to be attached to the lease that formally records the operator's decision not to provide obstetrics and Level 2 trauma care at the hospital. A commissioner described the side letter as a clarifying document and the commission approved it by voice vote.

During the meeting Kathy (hospital board representative) signed the documents on the record and distributed the Northwest HealthStart 2025 community benefit report, which she said recorded 3,700 patient encounters, $2,400,000 in uncompensated care, $1,500,000 in capital investments and $8,000,000 in payroll attributable to the facility. Commissioners emphasized the importance of maintaining a local hospital and thanked counsel for negotiating the rent and renewal provisions.

Next steps noted in the discussion: the signed documents will be attested by the auditor's office and a copy will be sent to CHS for final signature. Participants said they will calendar the 18-month negotiation window so the county can evaluate options well before the lease term ends.