District OKs Funds for Sonoma West Med. Center

[Sara S]

MARTIN ESPINOZA
THE PRESS DEMOCRAT | February 1, 2016, 11:31PM

The Palm Drive Health Care District on Monday approved a $500,000 loan to help its new hospital cover expenses through February because the Sebastopol facility no longer has any startup funds and has not yet received reimbursements from Medicare.

The district board also took the first steps toward asking Sonoma County to give the Sonoma West Medical Center an emergency $1 million advance on its parcel-tax revenue for the same purpose.

Hospital officials made a desperate and plaintive cry for help at the meeting Monday night, raising familiar fears that hospital was once again in danger of closing. The meeting drew about 100 people, many of them standing in a room that seated only about 50.

“There’s not enough money to pay the payroll this week,” said Gail Raborn, a Sebastopol resident who was active in the campaign to open the medical center, which replaced the former Palm Drive Hospital.

The district supports the hospital with parcel-tax revenue — about $1 million a year of the $3 million it bills district residents annually. But hospital supporters on Monday said more is needed because of delays in getting Medicare and private insurance reimbursements.

The urgency of that plea was tempered by a growing indignation among those who say the district cannot afford to make such payments because it is currently navigating bankruptcy and has other outstanding debts.
“If it gave another million and a half, the district would be broke. They need that money,” said Dan Northern, a Forestville resident who questioned the loan.

Northern said the district needs the money to pay off $2 million in annual bond debt and for hospital maintenance.

“I’m not opposed to the hospital,” he said. “I’m opposed to giving the hospital money when they should be using it to pay off debt.”

Up until now, most of the money to operate the hospital has come from its chief benefactor, millionaire software entrepreneur Dan Smith. But that level of philanthropy has come to an end, said Ray Hino, the medical center’s president and CEO.

“Now, it’s up to us to get the job done,” Hino told the district board.

The new medical center, open barely three months, is a 25-bed acute care hospital with a bevy of specialty medical institutes that hospital officials promise will help cover the cost of inpatient services and a new emergency room. But although the medical center was authorized in December to bill Medicare for medical services, it has yet to receive any reimbursements for services provided.

“Bottom line is Medicare doesn’t move very fast,” said Hino, adding that the medical center needs the infusion of $1.5 million by Feb. 22 to keep the facility functioning. He said that once Medicare and other insurance reimbursements start coming in later in the month, the hospital would become financially sustainable.

Many members of the public at Monday’s meeting urged the board to maintain a hospital in the west county, arguing that it had already saved lives.

The former Palm Drive Hospital officially closed its doors in April 2014 after filing its second bankruptcy since 2007. Hospital officials cited crippling competition from Santa Rosa hospitals — especially Kaiser Permanente — along with declining overnight patient stays and reduced health plan payments as factors in the closure.

The district’s decision to shutter Palm Drive was strongly opposed by the hospital’s nonprofit foundation, which proposed a physician-led plan to keep the facility open.

Jonathan Greenberg, a hospital supporter, said Monday night that the decision to close the hospital is to blame for the hospital’s current difficulty it is having with the Medicare bureaucracy.