Northwest Colorado Visiting Nurse Association officials have six months to decide where they'll move their Craig offices.
Susan McGough, interim administrator of The Memorial Hospital, gave the association formal notice at a meeting Thursday that it would no longer have an agreement to lease space in a building next to the hospital.
McGough said the association was offered comparable space in the hospital basement and the opportunity to buy the building at 745 Russell St. it now occupies.
There was even an opportunity to negotiate a lease-purchase agreement, McGough said.
The meeting came a day after the publicly owned hospital's board announced a slate of cost-cutting measures that included laying off 10 of its 133 employees and moving some services into the building the VNA uses.
McGough said the hospital needed to show the building as an asset, rather than a liability, to get funding to build a $19 million facility.
Plans are to build a facility for patient services on a site west of Craig and continue to house administrative services at the hospital's current location.
"It's absolutely imperative the hospital tighten its business practices because there is no way to get financing for a new hospital without it," McGough said.
Hospital officials estimate they can increase Medicare reimbursements by $98,000 by using the association's building for physician services.
They say they also are expecting to save $150,000 a year by moving a clinic into the Craig Medical Center and bringing physical therapy and emergency medical services on site.
"Time is critical to us," hospital board member Ron Danner said.
"We can't go to (the U.S. Department of Housing and Urban Development) with a negative bottom line."
The hospital lost $1.6 million in uncompensated care in the first nine months of 2005, McGough said.
Hospital officials expect HUD to provide the funding for the new facility.
Moffat County makes the association's $31,270 annual lease payment, but the hospital still loses about $97,000 a year on the building, McGough said.
"If you can't trust us after 10 years of that, we're not the right partners for you," she told association representatives who came to Tuesday's meeting armed with questions.
"Our motivation and our thoughts are very straightforward."
Association Director Sue Birch said she was concerned about whether the hospital had the legal right to move its offices. She said she thought bond money used to construct the $1.8 million building was earmarked for an association facility.
She also questioned whether a $460,000 Colorado Department of Local Affairs grant put toward the construction and $128,000 in community donations were specifically for the association, or for health services, as hospital officials say.
"I just want to make sure we're not sideways with donors," she said.
Birch said she first heard Tuesday there was a serious possibility of moving the offices. A single previous discussion gave the options of moving the care clinic and diabetic clinic into the building where the association is housed, she said. The final option was moving.
"I just think there is a lot of stuff that no one knows," association board member Mary Brown said.
The hospital and the county built the Russell Street building in 1997 to house the association.
The goal was to provide stability for an organization that had moved several times, including into the county annex building, an old Tasty Freeze building and several spots in the hospital.
Christina M. Currie can be reached at 824-7031, ext. 210, or firstname.lastname@example.org.