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NC Department of Health and Human Services

CMS decertifies Cherry Hospital; DHHS hires Compass Group, Inc. to evaluate hospital

Release Date: September 11, 2008
Contact: Tom Lawrence, (919) 733-9190 or (919) 218-2192 (cell)

GOLDSBORO – Cherry Hospital has been decertified as a Medicare and Medicaid provider by the Centers for Medicare & Medicaid Services (CMS).  The decertification was effective Sept. 1.

CMS placed the facility in immediate jeopardy status after an Aug. 13 survey investigating complaints concerning patient abuse and safety determined the hospital was not in compliance with CMS standards of participation.  A full survey conducted Aug. 26-31 concluded that Cherry Hospital was still out of compliance with patient health and safety standards.

According to Leza Wainwright, co-director of the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services, Cherry Hospital remains open and there will be no disruption of services to the community.

“The state remains committed to providing inpatient psychiatric services to consumers in eastern North Carolina,” Wainwright said. “The suspension of these funds will require an evaluation of the operational needs of the hospital.”

Wainwright says that the state will lose approximately $800,000 per month in Medicaid and Medicare receipts usually generated by eligible patients at Cherry Hospital.

She also announced the hiring of Compass Group, Inc. of Cincinnati, Ohio, as the independent outside hospital management consultant to evaluate the operational and management structure of Cherry Hospital. The group is tasked with identifying problems and making recommendations for immediate steps needed for correction and improvements within the facility.

“We brought in the Compass Group to provide on-site management expertise to assess all aspects of hospital operations including leadership, clinical care and compliance, medical staff, and operations,” she said.

The initial contract period is from Sept. 12-Oct. 15 and will cost $90,000.  The group is expected to deliver an action plan to correct deficiencies and to implement changes that will bring Cherry Hospital into compliance with CMS standards. 

In a second phase, the Compass Group will provide on-site management and training to ensure full implementation of the corrective action plan. Wainwright said that the time and length of Compass Group’s oversight of the hospital’s day-to-day operations will be determined once the action plan is delivered and approved.


Updated: October 14, 2008