HealthFirst board votes to renegotiate deal for Southland clinic

HealthFirst had planned to raze this building at 496 Southland Drive in Lexington and replace it with a clinic.
HealthFirst had planned to raze this building at 496 Southland Drive in Lexington and replace it with a clinic. Lexington Herald-Leader

After three years and nearly $1 million, the board of HealthFirst Bluegrass voted Monday to try to renegoiate the deal for a clinic Southland Drive.

After an 90-minute closed session, the board voted unanimously to allow interim executive director Dr. Steve Davis discuss options with landowners Greg McDonald and Ted J. Mims. Those options would include abandoning the plan for new construction at Southland Drive and renovating a smaller space somewhere else in Fayette County. Davis said that HealthFirst simply cannot afford to operate the proposed clinic at Southland Drive but wants to use the $11.7 million construction grant to expand health care in the community.

Mims' lawyer Richard Getty said he didn't think financial viability was at the heart of the decision but rather the location of the clinic on Southland Drive. "Do you think a bunch of rich, uppity white people don't want minorities over there being served by public health?"

"Is that what public health service is really all about?" he said. "I think not."

Most of HealthFirst patients are poor or uninsured.

Davis said he hopes to quickly enter negotiations on the current $25,000-a-month lease with property owners Mims and his partner McDonald. Mims is also paid $15,000 a month as project manager.

So far about $1 million has been spent on the Southland project, including about $600,000 on architectural work, site plans and storm water runoff plans. Mims has been paid $150,000 for his work as project manager and Mims and McDonald have been paid $250,000 for rent on the buildings slated for demolition.

Monday's vote brings the project full circle. When it was announced in 2010 as part of the Affordable Care Act, the $11.7 million was to be spent to renovate a building to serve the expected surge in people with insurance that would come with health care reform.

The first wave of some 640,000 Kentuckians without health insurance will eligible for care on Jan. 1. Construction on the Southland project, set to be completed this October, has yet to begin.

The project has been plagued by investigations by both the Kentucky Auditor's Office and the federal agency that oversees the implementation of the grant, Health Resources and Services Administration. Former HealthFirst Executive Director William North resigned in September along with most of HealthFirst's board of directors following pressure from the Board of Health, which has loaned millions of dollars to the financially struggling public clinic agency.

The new board, which voted Monday, was meeting for only the second time.

HealthFirst, a nonprofit funded mostly by tax dollars, operates a public health clinic serving about 15,000 each year at 650 N. Newtown Pike.

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