After 70 percent of staff terminated on Friday, Muskegon Family Care announces it will permanently close March 31

After Muskegon Family Care terminated 70 percent of its employees on Friday, Feb. 13, the health center said Monday morning that it will permanently close March 31.

“Our focus today and for the next several weeks will be on helping our patients find a new health care home to ensure continuity of care,” Muskegon Family Care Board President Kathy Hayes said in a press statement released Monday. “We are grateful for the support other health care partners offered in caring for community members.”

Until it closes, Muskegon Family Care—a nonprofit that serves about 20,000 patients annually and is located at 2201 S. Getty St. in Muskegon Heights—will “continue to provide medical, dental, behavioral, and pharmacy services for patients during normally scheduled hours of operation until the end of March,” the health facility said in its Monday press release.

On Friday, Muskegon Family Care terminated 70 percent of its staff, according to Jen Anderson, the associate director of communications for the Michigan Primary Care Association. Anderson did not have the exact number of individuals who were let go, but other Muskegon Family Care employees and patients said that about 200 people worked at the clinic.

“We didn’t want this to happen; they explored every possible option to keep the doors open,” Anderson said. “It came down to on Friday they wouldn’t be able to pay the entire staff for another pay period.”

Following Friday’s terminations, there was widespread confusion as to when Muskegon Family Care would close; some employees reported it would happen Friday or this week and patients had also been told the closure would happen momentarily. The confusion led to patients flooding the facility in attempts to transfer health records and figure out where they could go next to access care.

“We regret the worry this caused our patients, and we sincerely apologize for the misunderstanding,” Mitze Alexander, the interim chief executive officer at Muskegon Family Care, said in Monday’s press release. “However, these terminations were necessary to sustain services while MFC takes steps to responsibly wind down operations and help patients transition to other providers.”

Muskegon Family Care will close as the Michigan State Police has an “ongoing investigation into their financial situation,” said Anderson, of the Michigan Primary Care Association. Police said they are investigating “possible embezzlement involving staff members at the Muskegon Family Care facility in Muskegon Heights.”

“Those issues were compounded by the fact that the organization received significantly less revenue from Medicaid than anticipated,” rising organizational costs—such as for employee health insurance, and the “amount of debt owed by the organization,” Anderson said. 

“It was a perfect storm of financial complications,” Anderson said.

In an email to staff on Friday, Alexander, the interim CEO, said the U.S. Health Resources and Services Administration on Thursday “denied our request to receive advanced funding.”

“After this news, the board met yesterday evening to discuss how to proceed with ceasing operations as we are unable to meet the many financial obligations that we are and will be facing,” Alexander wrote in Friday’s email, which was forwarded to the Muskegon Times.

The closure will have a particularly devastating impact on low-income patients. About 79 percent of Muskegon Family Care’s 20,670 patients in 2018—the most recent year for which there are statistics—were at or below the federal poverty level, according to the U.S. Health Resources and Services Administration’s Bureau of Primary Health Care.

The facility, which operated with a budget of about $20 million, according to a 2018 audit, provided a wide variety of services, including medical and dental care, behavioral health support, a pharmacy, and care for women and infants. 

Muskegon Family Care has for years faced concerns and complaints regarding financial mismanagement. A 2014 evaluation by the U.S. Health Resources and Services Administration reported that top officials at Muskegon Family Care did not properly track how it used federal funds and violated its own bylaws and other policies during its 2010-2014 fiscal years.

In 2015, the Health Resources and Services Administration said the facility had turned itself around and had begun properly tracking its federal funds. However, another federal audit in 2017 found further “significant deficiencies.”

At the end of the 2019, former Muskegon Family Care CEO Sheila Bridges was fired, according to employees and Anderson. Alexander replaced her as the interim CEO. Anderson would not specify the reasons for Bridges’ termination.

As Muskegon Family Care faced financial concerns and questions, top-level employees’ salaries continued to rise. According to tax filings with the federal government, Bridges’ salary rose from  $120,132 for the fiscal year ending in June 2011 to  $461,113 in the fiscal year ending in June 2018. 

In 2017, Muskegon Family Care provided a $288,567 loan to Bridges for a “personal residence,” according to the health facility’s 990 tax form filed in 2018 [which you can see here]. By 2018, Bridges still owed the facility $280,544, according to the same tax statement.

Other administrators’ salaries rose as well. In the fiscal year ending in June 2015, for example, Marsha DeBoer, the chief financial officer for Muskegon Family Care, made $58,515; by 2018, she was earning $183,180, according to the organization’s tax filing. 

Employees, who spoke to us on the condition of anonymity, and patients slammed Bridges’ work as CEO, saying she created an atmosphere “rooted in fear and retaliation.”

“It breaks our hearts,” Amanda Hayes, a patient at Muskegon Family Care, said Friday of the impending closure. “Not only are patients scrambling, but the employees just found out this morning. We’ve been going here for 16 years; they’ve become like family to us. Now they’re suffering the consequences of the CEO.”

Despite the difficulties, patients also emphasized that the staff often felt like family to them.

“With a lot of those doctors in there, there’s almost a family feel,” said Krystal Lamb, a patient at Muskegon Family Care. “I had my [obstetrician] there, my dentist; we went there for everything. Now everyone’s panicking; we’ll be lucky to get in anywhere anytime soon.”

Lamb said she was at the facility for her son’s fourth-month checkup Friday morning when she discovered the center was closing.

“A nurse came in and told us they received an email that everyone was losing their jobs,” Lamb said. “Her makeup was smeared from crying; she’d probably found just 20 minutes ago.”

“I’ve been going to Muskegon Family Care with my two kids for a few years, and I don’t know what I’m going to do now. I can’t believe they’re closing just like that…I feel really awful for the doctors and nurses; it’s no way to find out, so suddenly and abruptly.”

Muskegon Family Care officials emphasized they will be helping patients transition their care as they prepare to close at the end of March, including providing referrals to other providers and ensuring patients have prescriptions refilled. Anderson noted that letters will be going out to all patients notifying them of the closure date, what they can expect with transition of care, and doctors that are accepting new patients.

“They’re looking for some patience and understanding; there will be a longer wait time,” Anderson said. “They’re pretty slammed right now for obvious reasons, but they’ll be doing everything in their power to help with the transition of care.”

Story and photos by Anna Gustafson, the publisher and editor of Muskegon Times. You can connect with her by emailing muskegontimes@gmail.com or on Facebook, Twitter and Instagram.