Audrain Community Hospital is seen in Mexico, Missouri, in August. (Photo by Matt Kile for KHN)

This story was originally published by Kaiser Health News.

The news, under Noble Health letterhead, arrived at 5:05 p.m. on a Friday, with the subject line: “Urgent Notice.” Audrain Community Hospital, Paul Huemann’s workplace of 32 years, was letting workers go.

Word travels fast in a small town. Huemann’s wife, Kym, first heard the bad news in the car when a friend who’d gotten the letter, too, texted.

“Your termination was not foreseeable,” said the letter, dated September 8 and signed Platinum Health Systems, adding that the firing was permanent “with no recourse” and that the “medical facility will be shuttered.”

“I don’t know what my next steps are,” said 52-year-old Huemann, who supervised the laboratory at the Audrain hospital.

The future for the Huemanns, hundreds of other workers, and thousands of patients in two small Missouri towns began to unravel long before that afternoon. The drama playing out in Paul Huemann’s hometown is familiar to many who live in rural America: Communities are so desperate to keep their hospital open that they’re willing to gamble on any buyer, including those backed by private equity.

Paul Huemann, the former laboratory supervisor at Audrain Community Hospital in Mexico, Missouri, was recently let go after the hospital’s parent company suddenly announced it was shuttering the facility.(Photo by Kym Huemann)

Sometimes they lose.

Noble Health, a three-year-old private equity-backed startup, had acquired Audrain and nearby Callaway Community Hospital during the pandemic. In March, it suspended all hospital services and later furloughed 181 employees, state records show. 

Noble — facing staggering debt, more than a dozen lawsuits, and at least two federal investigations — struck a deal to sell the hospitals in April to Platinum Neighbors, which is affiliated with Texas-based Platinum Team Management and Platinum Health Systems. In late June, Platinum asked Missouri officials to extend until September 21 a deadline to reopen the hospitals. On Tuesday (September 20), Platinum officials told KHN that, “on behalf of Noble,” they asked Missouri regulators for an additional 30-day extension “in an attempt to explore all alternatives for reopening these facilities,” Ryann Gordon, Platinum’s director of marketing, said. “The backpay and health benefits of the employees is of utmost importance.”

Hours before the licensing deadline Wednesday, Platinum submitted a request for a 90-day variance. Missouri regulations do not allow another extension within a year, said Lisa Cox, a spokesperson for the Missouri Department of Health and Senior Services. So the state “worked with them” and granted the request, she said.

Platinum said the hospitals need time to complete construction projects. Audrain’s “emergency room area” has broken windows, and Callaway’s hospital needs “critical repair to the plumbing,” according to the state approval letter. The hospitals can change ownership during the 90 days, Cox said.

Cory Countryman, president of Platinum Health Systems, confirmed the termination of the remaining hospital staff. “We are working with multiple partners to reopen the hospitals,” he said.

That could involve a new owner. One prospect is Owen Shuler, a Georgia-based entrepreneur, who said he is thinking about buying them. Shuler, who was reached by phone after he’d visited the rural communities, said, “I love what I see.”

“It’s heartbreaking as to what has occurred,” said Shuler, whose companies include Bankers Realty Corp. and Shuler Capital Corp. If he bought the hospitals, he said, he would do so as managing director of his new venture, CareONE Global. “In terms of the due diligence, I do not like what I’m seeing and learning,” he said. What he concluded from his review is that “private equity and venture capital need to be kept the heck out of health care.”

On his LinkedIn profile, Shuler said he “brings a lifelong perspective from a family owned skilled care business” as well as expertise in “telemedicine and healthcare services.”