Audit exposes deficit as troubled C.W. Williams health center emerges from bankruptcy

If it repays its debts, the embattled C.W. Williams Community Health Center, one of two federally qualified health centers in Mecklenburg County, will emerge from bankruptcy, despite a recent audit showing it operated on a $2.4 million deficit under its former leader.

The state bankruptcy court last week backed the center’s plan for financial reorganization, which includes paying nearly $700,000 to the Internal Revenue Service and satisfying debts to a number of vendors.

This comes just as county commissioners prepare Tuesday to discuss the center’s latest audit, which shows its liabilities exceeded $3.34 million while its assets were about $900,000.

In the report, auditors wrote that the center’s frequent losses raise “substantial doubt about its ability to continue.”

The audit, sent to commissioners last week, examined the facility’s finances through March this year. It mostly reflects statements in the months before the center filed for bankruptcy last year, and before Debra Weeks took over as CEO. In mid-March, she replaced Leon Burton, who replaced Beverly Irby when she left in October 2013.

“I cannot change what they’ve done in the past,” Weeks said Monday. “I can only improve (the center). It’s been tremendous work.”

Commissioners still must decide whether to relinquish a $390,000 allocation to the center that’s been kept in reserves for over a year until an audit could be finished.

The 35-year-old facility on Wilkinson Boulevard has received county money to provide medical care for low-income patients since 2007, when the county gave the center up to $480,000.

But a tide of financial issues led to it closing one of its satellite facilities, laying off staff and failing to give patients refills on common medicines.

The county withheld $97,500 – the last payment of a $390,000 grant to provide care for the homeless – because the center failed to provide an audited financial statement. That grant went to Charlotte Community Health Clinic, the county’s other federally qualified health center.

The county later offered C.W. Williams a one-time bailout of $390,000 if it met certain conditions proving its financial solvency. The facility filed for bankruptcy last December.

“Now that we’ve passed through bankruptcy, all those financial strands will open to us,” said Weeks, adding she hopes the center gets support from other groups, such as the Foundation for the Carolinas. She said she’s confident commissioners will soon release the $390,000.

Commissioners Chairman Trevor Fuller said approval of the center’s bankruptcy plan is a positive step. “We know the importance of C.W. Williams and still believe it’s an important institution,” he said.

On Friday, Weeks emailed the board, asking for a letter of support that will help the center apply for a federal Department of Health grant.

Commissioner Bill James said he’s skeptical about granting that request when the center hasn’t satisfied all the conditions commissioners set for the county grant. He questions if the center has a nonprofit medical partner to administer specialized care or tests.

“I don’t know what good it’s going to do to have a clinic when all you can do is treat boo-boos but somebody who might come in with a serious problem can’t get the services they need,” he said.

Weeks said the center has agreements with several facilities to provide that level of care. Since taking the helm, she’s linked the center with community partners, hired new staff members and ensured that the center collects Medicare and Medicaid reimbursements, she said.

By November, a part-time OBGYN and pediatrician offering Saturday services will be on staff, and a new dental program will begin, she said. She hopes to extend the pharmacy’s hours in January.

“People are starting to come back and agencies are coming back,” Weeks said. “We hear a lot, ‘we’re glad you’re back.’ ”

This story was originally published October 19, 2015 at 5:15 PM with the headline "Audit exposes deficit as troubled C.W. Williams health center emerges from bankruptcy."