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New manager brought into hospital
By Amie Windsor, Staff Writer,
[email protected]
Jun 23, 2017
Proposed lab services to bring $2 million a month
A deal that district board members called the hospital’s “last hope” was approved yesterday during a joint meeting of the Sonoma West Medical Center governing board and Palm Drive Health Care District board.
Both boards approved a management services agreement and laboratory management services agreement between Sonoma West Medical Center and Durall Capital Holdings, a Florida-based investment firm with approximately a year experience in the hospital industry.
“Sonoma West Medical Center is entering into a lab and management agreement,” said Chief Nursing Officer Barbara Vogelsang. “This is an opportunity for Sonoma West Medical Center to embark upon new services lines that have helped other rural hospitals.”
Under the laboratory management services agreement, the hospital will perform initial toxicology testing sent by Durall from individuals in drug rehabilitation programs from throughout the country. Durall technicians will perform the tests on new equipment to be installed in the hospital. Durall will purchase the equipment, valued at approximately $100,000, and invoice SWMC for repayment after six months of performing toxicology testing.
Durall will manage the toxicology laboratory for $150,000 a month, a sum that seemed superfluous to some board members.
“What exactly is Durall doing for $150,000 a month?” Jim Horn, district board member asked.
According to district attorney Bill Arnone, Durall will be, “funneling business through their contacts.”
“I think developing the service line is huge,” added district executive director Alanna Brogan.
Aaron Durall, principal with Durall Capital Holdings, estimates the hospital will run between 10,000 and 15,000 tests per month. Durall believes payout from insurers for the drug testing will be $2.8 million a month. SWMC interim CEO John Peleuses said the hospital and Durall researched the reimbursement rates from the hospital’s current insurers and that the estimated revenue is realistic.
According to the estimates, SWMC would collect $923,000 per month after payment for cost of reagents, personnel and estimated overhead of $773,000 is paid to Durall. According to the summary of agreements, the monthly payout is still being worked out.
According to Vogelsang, the country’s opioid epidemic will bring a steady stream of testing into the laboratory. “Our lab will have the necessary equipment to rapidly process these tests,” she said.
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