Grass has grown wild and tall around what was once St. Mark’s Medical Center. A blue tarp covers a hanging entrance sign, and a piece of plywood on the front door carries an announcement that the hospital is closed. Its hallways are littered with empty beds, medicine carts, and wheelchairs.
The shuttering of St. Mark’s last October left a hole in access to trauma care in La Grange, a small town between Austin and Houston. Roughly 40,000 Texans in the surrounding rural communities had counted on the hospital’s services, and the majority of patients were older adults with low incomes. While the area has a handful of urgent care clinics and physician offices, ambulances must now transport patients with more serious conditions to hospitals elsewhere.
St. Mark’s leadership attempted to keep the center in business last year by obtaining a federal Rural Emergency Hospital designation, which brought an infusion of about $273,000 monthly, plus an increase of 5 percent in Medicare reimbursements. But the move required an end to offering any inpatient services, and financial constraints forced a further transition to focusing solely on emergency care. More than 40 percent of the staff was laid off. “We just don’t have the balance sheet that we need to be able to wade through these troubling waters,” Mark Kimball, then the hospital’s CEO, told Texas Monthly at the time.
Just eight months after its February 2023 switch to REH status, St. Mark’s ceased operating. A representative of Community Hospital Corporation, which ran it prior to its closure, says the hospital’s revenue wasn’t sufficient to both fund operations and pay its debts. Those debts included a $13 million balance on a federal Department of Housing and Urban Development loan that financed the medical center’s construction.
Rural hospitals across the country are struggling, and Texas has led the way, with 21 rural communities losing medical centers in the last decade. John Henderson, president of the Texas Organization of Rural & Community Hospitals, says those that have survived have found solid financial footing via a local taxing authority, a wealthy benefactor, or a financial partnership with the likes of Ascension, Baylor Scott & White, or St. David’s HealthCare. St. Mark’s enjoyed none of those advantages.
Earlier this year, a deal appeared to be in place for a new owner to reopen the hospital, but in mid-July that too evaporated. Now the property’s fate will be left up to an auction later this month, and concerned residents of La Grange can do nothing but wait and hope.
When St. Mark’s opened, in the summer of 2005, it boasted 65 beds, a full surgical unit, obstetrics, an intensive care unit, advanced imaging, respiratory therapy, an emergency room, cancer treatment services, and a cafeteria open to the public. Families could lounge peacefully in a garden at the center of the hospital, away from the fluorescent glare of the waiting room.
The quality of care was consistently top rated, earning distinctions from Becker’s Hospital Review, high ratings from the Centers for Medicare & Medicaid Services, and A grades from the Leapfrog Group, a national watchdog for hospital safety. St. Mark’s seemingly had all it needed to succeed medically. But financially, the hospital was soon on life support.
Fayette County and neighboring Lee County had previously been served by Fayette Memorial Hospital, an aging and undersized facility within the city limits of La Grange that was unable to keep up with the projected population growth of the area. An exploratory committee composed of local businessmen, doctors, and hospital administrators concluded that a new hospital should be built. According to Michael Corker, president of the St. Mark’s Medical Center Foundation, the group collected $2 million from the relatively low-income community. “Hundreds of people donated thousands of hours to raise millions of dollars,” he says. The remainder of the construction funding came from a HUD loan of $24 million.
But fewer patients came to St. Mark’s than expected. Proximity to health care available in urban centers—Austin and the Houston suburbs are just over an hour’s drive away—siphoned enough patients to cut deep into the hospital’s bottom line. Kia Parsi, a physician and executive director of the Texas A&M Rural and Community Health Institute, notes that many rural residents who live within sixty miles of an urban area already travel those distances often for work or shopping. Doing so for health care as well comes to make sense to them. “Rural hospitals like St. Mark’s provide excellent care,” Parsi says. “But there is that misconception that bigger is better, and so residents may consider going to the urban area because of that misconception, which then makes it that much harder for rural hospitals to provide high-quality care because of the lower patient volumes.”
By 2009, four years after its opening, St. Mark’s was days away from bankruptcy, according to Dudley Piland, chair of the St. Mark’s board of directors. The board hired Plano-based Community Hospital Corporation to take over its management and attempt to resuscitate its finances. The hospital limped along for years, with the threat of closure looming over every budget cycle.
Hospital fundraisers were well supported by the community but soon dwindled, Corker says. St. Mark’s staff members sold barbecued chicken dinners to raise money to buy equipment. For years, raises were few and far between because there was hardly enough money to keep the lights on. “Every day for the last twenty years, we were closing,” says Laurie Quitta, who was director of the medical surgical services and emergency department. “We always had what we needed to take safe care of patients. I made sure of that on my unit. Patient safety was never an issue—but taking care of employees was.”
In 2019, the St. Mark’s board moved to shore up finances by calling for the creation of a taxing district that would collect 10 cents per $100 property valuation from the county’s homeowners. But the community rejected the proposal handily, with 81 percent voting against it. At the time, Deborah Frank, chair of the Fayette County Republican Party and a member of the Concerned Taxpayers of Fayette County PAC, which led the opposition, told the Texas Observer that the closure of St. Mark’s wouldn’t constitute a significant loss because La Grange was “surrounded” by medical facilities in neighboring towns.
But Josh Vandever, Fayette County’s director of emergency medical services, says there’s been a negative financial impact since the closure of St. Mark’s, mainly due to the uptick in costs of maintaining and operating an ambulance fleet that now must travel an average of 10,000 additional miles each month, transporting patients roughly 25 miles to hospitals in Columbus or Smithville, or sometimes between 60 and 70 miles to Austin. “We used to need to replace one ambulance a year. Now we’re looking at two a year,” Vandever says. “And the cost per ambulance has gone up about forty percent since 2020.”
Increased federal funding to combat the COVID-19 pandemic offered St. Mark’s a temporary financial reprieve, according to Piland. But once that money dried up, the hospital found itself in even more dire financial straits. It would have closed sooner had it not received the lifeline of the federal REH designation.
Even so, shortfalls continued, despite the 40 percent reduction in staffing. And the changes precipitated a host of new challenges. For instance, St. Mark’s eliminated its food-service staff and cut the majority of its housekeeping team, but rooms still needed to be cleaned and patients fed. (Even though REH facilities cannot offer inpatient services, they can still offer observational care that may require a hospital stay of up to 24 hours.)
Former St. Mark’s supply chain manager Courtney Menefee told me that because the REH patient volume was much smaller and less consistent, ordering food in bulk from the usual suppliers no longer made financial or logistical sense. Instead, staff members were sent to purchase Healthy Choice frozen meals from the local H-E-B every week in order to give patients hot meals. Shelf-stable snacks purchased prior to the transition, such as peanut butter and graham crackers, were used until they expired, at which point they had to be tossed. In a pinch, Menefee says, staff members even purchased Whataburger takeout for patients.
“We did the best we could with the resources we had left,” says Menefee about this period. “Patient care was our number one priority, but everyone had to take on new roles and responsibilities in order to make it work.” She says the rushed nature of the transition and poor communication made a tough situation even tougher.
Because of the lack of services, patient volumes continued to plummet, pushing St. Mark’s further into the red. “In the absence of being able to do catheter labs, GI endoscopy sweeps, and surgeries, it’s really hard to make money on the medically frail,” says Dr. Rodney Young, a family physician who sits on the board of trustees of the Texas Medical Association. “You typically won’t make it on emergency rooms alone.”
On the morning of the final day of St. Mark’s, last October, those present say the sense of grief and disbelief was palpable. A handful of hospital diehards—current and former employees, retirees, volunteers, and patients—tailgated in the parking lot. With barbecue, breakfast tacos, and mimosas, they counted down to the moment when the doors to the emergency room were locked for the last time.
“Nobody wanted to leave,” Quitta says. “Staff came; doctors came. I finally told them, ‘Y’all have to go. We’re blocking off the parking lot.’ That’s what a family it was.”
Sorrow about the closing of St. Mark’s ran deep throughout the community, but especially within my family. My mother worked as a surgical nurse in La Grange for more than thirty years—first at Fayette Memorial and then at St. Mark’s. I grew up in the hospital, watching her work.
I was there on opening night, seventeen years old and drinking my first taste of champagne. When my grandmother was dying of stage IV lung cancer in May 2020, St. Mark’s allowed us to transfer her there from a nursing home in Columbus. Nurses and doctors comforted and grieved with us. I stood in the healing garden as I called my brother to tell him Granny had died. The fountain had long been shut off, and the grounds had gone fallow for lack of funds.
A year later, the staff of St. Mark’s cobbled together funds to purchase a memorial paver in the garden to honor my grandparents. I never got a chance to see it before the hospital closed, but last spring, I visited St. Mark’s again. Peering through a window, I spied photos on the wall of my mother and other hospital staff members over the years. In the garden at the center of the building, I found my grandparents’ paver, broken and grown over with weeds.
For months, there had been newfound hope for the hospital’s future. A potential buyer had emerged—Progressive Health Group, a company with an emerging track record of reviving struggling hospitals. Progressive had big plans, expecting to revive physical therapy, wound care, and advanced imaging services, along with an ER and surgical unit, as well as a women’s health clinic with 3D mammography and obstetrics.
But when St. Mark’s closed, it defaulted on the $13 million it still owed HUD, and the federal agency took ownership as a result. Progressive offered $2 million to purchase the hospital property, so long as it wouldn’t have to take on the outstanding debt, but in mid-July, HUD announced it was passing on the offer.
Instead, HUD is auctioning off St. Mark’s this month. According to a letter sent to the hospital’s board, the agency decided an auction was the “most expedient process” through which to “maximize recovery” from St. Mark’s. In other words, it would be faster and more financially prudent than simply cutting a deal with Progressive. St. Mark’s will be bundled with fifteen other medical properties across the country as part of a single sale. Offers are due on or about August 21. Progressive was deemed ineligible to bid because of its prior access to insider information about St. Mark’s in the course of its attempted purchase.
While the winning bidder could choose to reopen the facility as a hospital, there are no guarantees it will. “I am disheartened,” Piland wrote to me in an email. He had led the St. Mark’s board for more than 25 years, much of his life wrapped up in preventing this exact moment. “Whoever buys it can do whatever they want to do with it. It could be a shopping center, or it could be bulldozed entirely.”
For now, La Grange remains without access to trauma care. Frank Menefee, former city manager and father of the former St. Mark’s supply chain manager, says the lack of a local medical center is a constant worry. “I’m always reminding myself: ‘Be careful. An ER is twenty to thirty minutes away,’ ” he says. “I look at my grandkids, and I don’t want them to get hurt. I think the same thing about all the other people in the community every day.”
Audrey Wick, a college professor, credits St. Mark’s with saving her life when she suffered a brain aneurysm in 2019. “It hit me hard when St. Mark’s closed,” she says. “Rural people need medical care. They need it, and they deserve it.”
