HOSPITAL ROUND-UP: Recent Hospital Sales, Deficits
California hospitals announce their intentions for sales, mergers and state relief requests:
- Chino Valley Medical Center: Chino Valley owner The Health Care Co., is in final negotiations for the hospital's sale to HCH Investments, a Los Angeles-based real estate company. Although the terms of the sale have not been disclosed, HCH Investments plans to lease the 126-bed facility to Veritas, a Chino-based physician-owned company. According to The Mardel Group, which has contracted with Veritas to manage the hospital, all 600 hospital employees will retain their jobs. HCA does not have plans to sell its other two Southern Californian hospitals (Faustina, Knight-Ridder Tribune Business News, 10/2).
- Palm Drive Hospital: " 35 for Palm Drive," a group of Sonoma County civic leaders who donated their time and resources to keep Palm Drive Hospital open after Columbia/HCA decided to close the facility in November 1998, have sold the hospital to Salomon Smith Barney for $5.9 million in general obligation bonds. The group will receive $3 million, while the remaining sum will be used for earthquake retrofit and emergency and operating room improvements. Gov. Gray Davis (D) signed a bill on Sept. 28 that gave Palm Drive "some breathing room in financing operations." Hospital officials plan on limiting the inpatient use of the hospital's 49 beds, instead generating income from the 24-hour emergency room, and outpatient services such as chemotherapy treatment, lab tests, mammograms and sonograms (Rose, Santa Rosa Press-Democrat, 10/4).
- Los Medanos Community Hospital: Under recent legislation signed by Gov. Davis, Contra Costa County may be reimbursed by Medi-Cal for up to $4.25 million of the $14 million the county has sunk into improving the closed Los Medanos Community Hospital. As a result of the renewed Medi-Cal eligibility, hospital board chair Bruce Croskey said that part of the facility may reopen within eight months ( San Francisco Chronicle, 10/3).
- Alta District Hospital: Alta District "continues to fight for survival" following an unexpected rejection of state budget relief for the 39-bed facility that has been "on the verge of closing" for several months. Without the anticipated $300,000 in relief, hospital officials are uncertain of the institution's future and are considering affiliating with a larger regional health system or selling the hospital to the city of Dinuba. Officials have already applied for a rural health clinic in the attempt to secure greater Medi-Cal and Medicare reimbursements, and are speaking with the state Department of Health services in the quest for financial assistance (Correa, Fresno Bee, 10/5).
- Healdsburg General: Upon discovering a reimbursement calculation error, hospital officials learned that Healdsburg General suffers from a $900,000 deficit that "threatens to balloon to $1.2 million" due to delayed HMO reimbursements. As a result, the 43-bed facility may have to "affiliate with a health care chain or seek taxpayer support to cover the shortfall." Meanwhile, hospital administrators will concentrate efforts on increasing revenue and decreasing costs (Rose, Santa Rosa Press Democrat, 10/5).