Insight Health steps away from lease-to-purchase talks with Hazel Hawkins Memorial Hospital
Jeanette Bent
SAN BENITO COUNTY, Calif. (KION-TV) — Hazel Hawkins Memorial Hospital out of San Benito County announcing further challenges Wednesday afternoon.
They said that the former interested buyer, Insight Health, is stepping away from lease-to-purchase negotiations because of the shifting, federal financial landscape.
Insight saying that the One Big Beautiful Bill Act (OBBBA) recently signed by President Trump has created unprecedented uncertainty for rural healthcare.
“OBBBA has created a level of uncertainty for us here in San Benito County that we have never seen before,” said Mary Casillas, HHMH CEO. “While we have yet to fully understand OBBBA’s impact, we know it has affected the potential transaction with Insight and is having similar consequences for rural hospitals across California and the nation.”
The Center for Healthcare Quality and Payment Reform saying that nationwide, nearly one-third of rural hospitals are in danger of closing. To break it down, that’s 700 at-risk with an additional 300 considered at immediate risk.
This comes after much turbulence by San Benito County voters to approve the hospital’s sale to Insight in the last election.
“I’m disappointed, of course.”
Mary Casillas is the CEO of Hazel Hawkins.When she took over in 2022, the hospital was in dire financial straits, with only a days worth of cash on hand.
“We were able to do some financial restructuring and really take a look at our revenue and our expenses and make some alterations to put us in a better place. So we are in a slightly better place at this point.”
She said things were looking further up with Insight Health poised to come on as a partner.
“They were very excited to grow services in san benito county, which we need desperately. They had plans in place to look at recruiting physicians to bring in to do that growth of services.”
But that would cost money, and now $137 billion in cuts are expected to hit rural health providers like Hazel Hawkins.
A Hollister mother said there’s already a lot to be desired at her only regional hospital.
“They’re definitely mismanaged and not trained. Definitely. And they’re not a clean hospital,” said Brittany Marie.
Lots of folks said they regularly drive to either Gilroy or Salinas just to avoid Hazel Hawkins.
“I took my boyfriend at the time all the way to Gilroy at 1:00 in the morning, just because I knew instead of going there and sitting seven hours in the ER, we got seated immediately, put in a room, immediately got the x-rays that were done an hour and a half,” said Marie.
Casillas said her hospital had already cut some services in the past couple years, and now the future is more uncertain even as they continue to look for a new partner to replace Insight.
“We’ll just have to do a reassessment and see what the best thing is for the district and rural health care. It’s very early in the projections of what? These cuts. We know they’re starting in October. But it’s projected in about two years to really see the cuts start to come,” said Casillas
Medi-Cal coverage is among the most impacted by the federal cuts, which means the hospital could find itself in a financial hole when they treat people who can’t pay.
Casillas said she’s got meetings lined up with several other rural hospitals in the next couple of days, to share stories and talk about best practices to survive the cuts.
She emphasized that there’s no chance Hazel Hawkins will close.