The Eureka Springs Hospital Commission is zeroing in on hiring a new CEO, but that doesn’t necessarily mean other proposals for oversight of the facility are off the table.

That’s what commission chair Sandy Martin told members of the Eureka Springs City Council during the council’s regular meeting on Monday, April 28.

The topic of the hospital once again took up a majority of Monday’s meeting, with council members continuing to voice displeasure at current administration at the facility, financial issues and the plan moving forward, including a recent proposal by local physician Dr. John House to take over the hospital’s operations.

“It’s my understanding … that a CEO or Dr. House, it’s not exclusive,” council member Steve Holifield said during discussions. “They can hire a CEO and still do Dr. House’s plan. … I thought, well, if they hired a CEO, that means Dr. House’s plan has been rejected. But, then I was told that’s not true.”

Martin told the council that hiring a CEO, or engaging in a management agreement with House’s company or another outside group, is “not necessarily exclusive.”

“Our commitment is to get a CEO for management,” Martin said. “They are not exclusive. They can be done in tandem. We feel that a CEO is necessary. There are a lot of things in Dr. House’s proposal, as he even states, that need to be discussed and vetted out a little further. There are some legal considerations that we have to do.

“But, we are pursing a CEO. We’ve got a good candidate. And, we will continue discussions with Dr. House.”

During a recent meeting with the hospital commission where he laid out his proposal for running the facility, House indicated that he already had commitments from a leadership team that he would be bringing in to head up his staff.

However, Martin told the Times-Echo last week: “Obviously, if we hire a CEO and pursue any type of management agreement, that will be part of the negotiations.”

Many council members voiced their support for the commission seriously considering an offer from an outside source, notably House, with some indicating they feel the CEO route is the main focus.

“…When we’re only looking at a CEO position, we have missed opportunities,” council member Susane Grunsing said. “I think we owe it to our community to look at all avenues. Dr. House, CEOs, and put the RFPs out there to see if somebody can come in and run the hospital to the best of what the strategic plan and the hospital needs. … I’ve not heard a really good reason why they only want to go towards a CEO. So, we can only make the assumption that they feel a CEO is the only viable alternative, even though history has shown a CEO-run hospital in Eureka Springs with commission oversight has been a failure in the community’s eyes. Taking this path with no strategic plan or longterm goals that I know of would be a mistake.

“The alternative may be to put out the RFP to an outside entity to manage the hospital, which spells out the needs of the hospital, and they know what to go for. Dr. House came in and, I guess, gave a very good presentation. But he’s giving a presentation on what he thinks the hospital needs. The hospital has never identified to him what they’re looking for. So, I don’t know how you align that when you’re looking at candidates.”

Hiring a new CEO isn’t going to fix the issues, Gruning said.

“… Do we repeat our failures without better knowledge, why we failed?,” she said. “There have been no changes to admin. Employees are jumping ship like the Titanic and we’re headed back to the same iceberg. What is going to change in hiring a new CEO? Putting all your apples into hiring one person to fix everything is not realistic. What is going to change?

Council member Harry Meyer agreed.

“I am seriously disappointed that Dr. House’s proposal was sort of offhand stuffed in the back room,” Meyer said. “I don’t know, maybe they’re still thinking about it and they’re going to have a CEO in between. I don’t know…. ”

‘NOTHING’S CHANGED’ Gruning had the hospital issues once again placed on the agenda, and again voiced her frustrations on a number of issues.

“I’m disappointed on many levels in regards to the professionalism, the communication between us and the hospital and finding things out in the paper,” Gruning said. “I’d like to express my deep concern and disappointment in the direction and performance of the hospital commission.”

Gruning said she was unhappy she was told she couldn’t attend a recently planned meeting between Martin and representatives of the Mercy healthcare system regarding possible interest in taking over the hospital. That meeting was canceled by Mercy after the Times-Echo reoported that it had been scheduled and that Gruning’s formal request to attend had been denied by Mayor Butch Berry.

“I was disappointed to not be allowed to attend a meeting,” Gruning said. “It did get canceled but to be told that I would not be allowed to be there to hear what all was being asked, I believe our citizens deserve better leadership, better transparency, and most importantly, a hospital we can all trust.”

Gruning continued to point fingers at the leadership of the hospital and the commission, indicating nothing had been done to resolve issues that have bee discussed for months.

“The commission is put there to act as an oversight for the hospital to ensure the health and safety of the community and those employed by the hospital,” Gruning said. “With the exodus of so many employees, due to the current admin, again, nothing’s changed. So, what is the structure of the commission and their charter as it relates?

“… Over the past year, multiple citizens, current and former employees, family members, have brought serious concerns to light about dysfunction and toxicity within the hospital’s workplace.”

Gruning brought up an issue with a former employee who she said submitted a letter to the commission in March stating that she resigned after she wasn’t allowed to look into a “pulmonary rehab program” for the hospital.

“When she was told no, even though she showed the ROI and did her homework, she was still told no,” Gruning said. “She decided to resign because she felt like she was being blocked from something positive. And when she resigned they asked her to leave right away. So, why wouldn’t she have been allowed to work her two weeks?

“After working through conversations with the commission and reviewing public information, information that we’ve all received from hospital employees, I have to agree that with those who have stepped forward, that their concerns and my concerns align.”

Gruning went on to recap her concerns.

“Just a reminder of the top issues that we have heard since, what? October, November?” she said. “A hostile work environment, employee turnover is crazy, and whether, I mean, it’s crazy, period. We all know that to replace an employee is very costly. There’s training involved, you’re paying people overtime to fill in. Poor accounting, non-functional lab … Failure to pass Medicare audit. We did pass it, they got through it, but we had issues with it, and for a small hospital, that’s a little surprising.

“Reminding ourselves of these issues, when this council asks questions, it’s not to criticize. It is to ensure the commission is upholding the highest standard of care and creating a safe, reliable hospital. We want to partner with the commission. We want to see how we can help because it’s our community coming to us, and it is a city-owned hospital. So again, not to criticize, but to try to figure out what is not working here. There’s been alarming examples that have raised major red flags for me.”

Gruning later reiterated that it’s not a council versus commission issue.

“I was disappointed by the defensive comments made by a commissioner [at a recent meeting] who said they felt that they were treated like idiots, quoted from the paper, during council discussions per the article,” she said. “I would encourage leadership to view this as an opportunity and not a personal attack and to reassure the public with facts, not emotions. It sounds like we’re battling and that’s not what we want. It’s not us versus them. It’s what we can do together.”

INDEPENDENT FIRM

Martin told commissioners that plans are still in place to bring in an independent group to take a look at the various personnel accusations that have been made over the past few months.

“Despite everything else that’s happening with the hospital, I always go back to we have a plethora of current and former employees that have literally screamed hostile work environment,” council member David Avanzino said to Martin. “And we have done nothing for them except keep that hostile environment in place. And I don’t understand that at all. If we were in the corporate field here, those people would be suspended pending an investigation or terminated. And I can’t wrap my head around why that’s not happening.”

“Well, two things,” Martin responded. “One, I don’t believe we have that hostile environment now. And employees are not leaving in floods. Secondly, we are going to do an independent investigation. We’re looking for an independent firm that will come in and deal with those employees and interview all those employees and give us a report.”

“Now, is this a law firm, or is it a human resources firm?” Avanzino asked. “Because, what we need is a human resources firm, not an attorney.”

Martin replied: “It’s going to be a human resources firm and it’s going to be somebody that is not associated with the hospital.”

She hoped to have an update on identifying a firm within the next couple weeks, Martin told council members.

‘A LITTLE SKETCHY’

Meyer asked Martin about an “anger management issue that woman took a course on.”

“…That kind of shows that she had a problem,” he said. “And I’m thinking she still has a problem.”

Martin asked Meyer whom he was referring to.

“You don’t know,” Meyer asked. “You don’t know who was on the cover of the newspaper? It said she’d gone through some issues, some anger management.”

Martin replied: “I haven’t read the newspaper yet, sorry.”

“Well, it’s a month ago,” Meyer said.

Eureka Springs Mayor Butch Berry interjected, saying, “I haven’t read the newspaper, either, Mr. Meyer, so I’m not sure what you’re referring to.”

Meyer said the person he was talking about was someone who “was accused of running people off in the past” and has “cameras looking around.”

“The CFO,” Meyer said, presumably talking about Cynthia Asbury, who has been alleged by former employees to have engaged in bullying.

“I’m not going to comment on employees,” Martin said.

Avanzino then became part of the conversation mentioning an employee wearing glasses that have recording capabilities.

“It’s the CFO, but I’m not going to comment anymore on employee issues,” Martin said. “It’s the CFO that has those glasses.”

“Why does she have those glasses?” Avanzino asked. “Why are they necessary in her job?”

Martin replied: “She uses those glasses. I don’t know, David, I mean she doesn’t use the camera.”

The exchange led to another interjection from Berry.

“Council, remember, it’s not us to talk about the employees,” the mayor said. “We don’t have authority over the employees and ask these questions. This is a hospital, according to state law. So, I’m concerned about some of these things as you are, but it’s outside of our authority.”

Gruning continued on the subject.

“I don’t disagree with what you’re saying, Mayor, I think we’re just trying to make a point that some things sound a little sketchy,” Gruning said. “And if you’re wearing glasses like that in a workplace, that sounds secretive to me.”

“Well, you know, it sounds kind of kinky.” Berry replied. “But, also it was kind of kinky when I got taped without my knowledge talking about city business and then was reported that I perjured myself by a city council member. So, there’s certain things that, you know, people are not trusting very much anymore.

“So, when you get into HR, I’m sure there’s areas where ‘he said, she said,’ in these lawsuits anymore.”

“That’s a financial officer,” Meyer replied.

The Times-Echo has not reported that anyone associated with the hospital took anger management courses.

‘THEY’RE NOT GONNA CHANGE’

Council member Terry McClung reminded the council that a vote could eliminate the commission.

“The hospital, we all know, is a critical component of our community,” he said. “I mean, that’s just a fact and it’s a major employer of the community. But, there’s a hospital commission that runs it. We can make all the recommendations you want to, and they’re going to run it the way they see fit to run it. Unless you want get rid of them. There’s a lot of talk, but there’s no action.

“So, if you want to make motions and do something like that, get on with it and get it over with. The risk is that you’re going to lose the hospital, because once you do that, and the state looks at everything, and they look at that facility with a critical eye, they’re going to say: ‘Well, it ain’t worth keeping them going anyway.’ So … the hospital commission, unless you get rid of them, they’re going to operate the way they see fit. And if they’re gonna run it in the ground, they are gonna run it. If it survives, it survives.

“But, you, know, our hands are tied …. Unless you’re gonna eliminate the commission and do something different, they’re not gonna change. I mean, you’ve seen that already. You know, they’re pretty set on the way they’re gonna operate. Make a move if you’re going to make one.”

FINANCIALS, PEOPLE

Martin shared some financial numbers with the commission, which she said show the hospital has a “healthy bank balance and we have reduced expenses.”

“Yes, our revenue is lower,” she said. “We anticipated that because of the [Rural Emergency Hospital] conversion. But, if you look at the operating margin historically, that kind of gives you an indication of the trouble we did have with previous management firms. And it gives you an idea of the hole that the commission has been digging the hospital out of.

“The other key metric that is really critical is how many days with cash on hand do you have in the hospital? We are healthy, and we have grown it. Last year we ended with 405 days. There are nine hospitals in Arkansas that are a nine-day cash on hand, according to the Arkansas Hospital Association. They have to pay their vendors daily in cash. There are lots of others that are under 30 days or between 60 days. We are pretty healthy as far as that goes.”

The charts Martin shared with the commission showed that the hospital’s year-end bank balance was $7,539,194 to close 2024 compared with $6,064,463 at the end of 2023.

Net revenues in 2024 were $8,498,209 compared with expenses of $6,781,122. In 2023, net revenues were $8,289,255 with expenses of $8,334,467, according to the information Martin shared.

A chart showing the hospital’s “operating margin from 2021-2024” indicates a margin of minus-$ 2,136,596 in 2021, minus-$252,828 in 2022, minus-$45,414 in 2023 and a positive margin of $1,717,087 in 2024.

The final statistics shared, the number of days with cash on hand, indicated 265.6 days in 2023, 405.8 days in 2024 and 1,067.8 days in the first quarter of 2025.

“We continue to invest in the hospital,” Martin said. “We will have deficit months as we go through it, but we do also, and I think I answered this, have a strategic plan that we’re working on. We’ve got a consultant, the Rural Health Redesign Center. They’re coming in within the next couple of weeks, I think, or month.

“… So yes, we have strategic planning in process. We are getting ready to start workshopping our budget. To take a look at that, it’s going to be a work in progress because there are things that constantly move.”

Avanzino said while he was appreciative of seeing the financial information provided, the focus should be on personnel.

“Sandy, I appreciate the commission and you bringing bank balances and revenue expense comparisons and all this to us,” he said. “But, I think that the commission is focused on the wrong thing right now. Because your main issue right now is people. It’s a human issue. It’s not a financial issue. And the humans that make up that hospital are its employees and its community and I don’t think that’s being addressed by the commission.

“I’m not saying that it’s not, we’re just not hearing about it other than what you just said about a HR firm coming in. That’s all we’ve heard. Because the way I see it, and I’m going to speak for myself, is that you’re ignoring, the commission is ignoring, everything human about what has happened with that hospital.”

Martin responded: “I just totally disagree, David.”

“And that’s fine,” Avanzino replied. “I expect the commission to disagree, but I’m just letting you know what I see, what I’ve heard. I have not received one single letter in support of any administration at that hospital. Not one. Dozens and dozens, on the other hand.”

“I understand,” Martin said.