Community Health Centers stays open despite grant loss

Tuesday, Jan. 18, 2000 | 10:49 a.m.

Community Health Centers of Southern Nevada vowed Monday to keep the doors of its clinic for the poor open, despite the pending loss of a federal grant that in past years has provided two-thirds of its funding.

The embattled nonprofit group, which last year lost the contract to run a health clinic at the Howard Cannon Senior Center, provides primary care, pediatric, dental and OB/GYN services to 40,000 people annually at the clinic at 916 W. Owens Ave. It employs 45 full- and part-time workers.

The loss of funding, effective April 1, will affect mainly the homeless, the uninsured and those receiving care on a sliding-scale basis, Louis Conner, chairman of the Community Health Centers board of directors, said.

Re-evaluate future

For the past month the Community Health Centers' board has sought funding from private and public organizations, who have pledged to support the clinic. On Monday it went public with its current crisis.

"We had to sit down as an organization and re-evaluate our future and put our plans in action," Conner said. "We had to reinvent the way we do business. The clinic will not shut its doors."

Conner said the National Medical Association -- a minority doctors association -- has committed to staff the clinic with doctors in absence of the grant. The owner of Nucleus Plaza, where the clinic is located, has agreed to reduce the rent if needed, and Bank West and nonprofits in the Las Vegas Valley have promised support. Nevada Legal Services will provide services for free, Conner said.

Conner said the end of the federal grant from the Department of Health and Human Services' Bureau of Primary Health Care, which supported the group for 11 years, came as a surprise to the group and was unwarranted. The grant was awarded to Nevada Rural Health Centers based in Carson City.

The letter notifying the group of the denial cites the organization's unsteady 11-year history for its decision to not renew the grant.

But the center said that its problems are not of its own making.

The board's rocky operations first came to light after the former executive director, Chuck Silloway, incurred debt by hiring doctors and other staff in expectation of the clinic getting a state contract from new Medicaid management. But the clinic did not win the contract.

By 1994 the organization was $2 million in debt, owing money to the Internal Revenue Service and other creditors. Employees were not being paid and the clinic was losing money.

The debt angered board members, who said the federal bureau insisted on keeping Silloway when the organization wanted someone else to head the project.

Silloway resigned, and a management team from the University Medical Center was sent in to temporarily manage daily operations, evaluate the center's activities and recommend changes.

That same year the U.S. Public Health Service held out on providing a $1.3 million grant to the organization until four of the six board members stepped down and were replaced by people with more expertise.

In July the organization lost its contract with the Las Vegas Housing Authority to operate a medical clinic for senior citizens at the Howard Cannon Senior Center. That action came after Executive Director Ken Moore reduced the clinic's hours from five days a week to two days a week because of the center's financial problems. Moore resigned and was replaced by Valerie Dykes, an interim director from Sahara Health Care.

In 1997 the Internal Revenue Service absolved the center's debt of more than $1 million. The organization, however, still has $1 million in outstanding debts that are at least four years old, Conner said.

However, the center was on the verge of saving $250,000 by building a new center, he said, and the Public Health Service knew of those plans.

New clinic planned

In a partnership with Las Vegas, North Las Vegas and Clark County, Community Health Centers was planning to break ground on a new facility at Martin Luther King Boulevard and Owens Avenue this year. The centers would close the current facility and owe only $1 a year in rent for the new one. The board is asking Nevada's congressional delegation to investigate as well as turning to the community for financial support or community donations.

"It will take a miracle," Conner said. "Or in laymen's terms, an act of Congress."

Larry Gamell, community relations director for Community Health Services, said by taking care of $1 million in debt, the organization has already worked some miracles. The group is disappointed that the Public Health Service did not take that into consideration.

The debt is directly related to the old board, Conner said.

"The new board inherited $2 million in debt without any increase in revenue," Conner said. "Any prudent person would say it's only a matter of time before the venture would fold.

Borrowed from others

"It's hard to come in and run an operation like this," he added. "(Yet) we've managed to keep these doors open for 11 years."

To stay in operation and pay off the debts, Conner said the organization has borrowed from other entities, tapped into reserves and increased fees.

According to the letter from the U.S. Bureau of Primary Health Care, it wasn't enough. The letter states that the organization "did not demonstrate satisfactory progress toward reducing long-term debt."

The bureau listed in the letter its expectations for grantees, which included "appropriate management to meet the challenge of efficient and effective operations" and a grantee's ability to operate within available resources.

"The CHCSN management staff and governing board have failed to provide efficiently qualified and experienced staff to effectively and efficiently carry out the center activities," the letter stated.