The options to take over operations of Grays Harbor Community Hospital are laid out in front of them, and Public Hospital District 2’s commissioners are poised to act, but now they must wait for the state to decide which options pass muster before they can choose a course.
Current hospital Chief Executive Officer Tom Jensen and Chief Financial Officer Joe Vessey met with officials from the state Health Care Authority on Tuesday, and presented the three possible options for the district to take over the hospital.
The district has discussed either purchasing the assets outright, leasing them, or simply taking over operations of the current nonprofit that runs the facility, keeping the nonprofit in place.
“At this point in time, the ball is in their court,” Jensen said, adding that a time frame for the authority’s decision is hard to pin down, though they were “very helpful and supportive.”
At stake is increased Medicaid reimbursement that is at the center of the public hospital district’s formation — money that isn’t available to the nonprofit hospital in its current incarnation. The third transfer option — simply having the public district take over the nonprofit while leaving it in place — has the fewest hurdles, lowest cost and fastest transition time. Whether it passes muster with the state leaves that extra reimbursement in the balance, and only the Health Care Authority can make that call.
The purchase option could take up to two years to consummate, while leasing the facilities from the nonprofit could take as much as a year to put in place. Simply taking over the nonprofit could take as little as three months, leaving the district in position to potentially reap the benefits of the higher reimbursement as soon as January — the first month it is available.
Commissioner Miles Longenbaugh asked Foster Pepper PLLC attorney Brad Berg if the commissioners could start down the path of one of the options — namely taking over the nonprofit — without yet knowing the verdict of the state agency.
“I was hoping to have a better result from the Health Care Authority,” he admitted.
“If this board is feeling clear that action should start to happen, then background work could be done,” he said, adding that paperwork to change the corporate structure of the nonprofit to install the district as its sole member could be drawn up in draft form.
He added that the cost to draw up that paperwork would be minimal, but it would have a cost. Currently, the district has no assets to pay for such fees.
Several commissioners turned to Jensen, asking if he had any idea what the time frame of the Heath Care Authority’s decision might be.
“They have their own processes that they go through,” Jensen said, adding he wouldn’t want to speculate.
In addition, the state agency isn’t the only one that has to agree on the method of transfer. Discussions are just beginning to see if the current nonprofit board would be agreeable to any one of the transfer options.
To that end, Commission President Maryann Welch announced to the board that she and Commission Secretary Bob Torgerson plan to meet with representatives from the current nonprofit hospital board on Oct. 8 to begin discussions on the transition.
Ultimately on Tuesday night, the commissioners declined to take any official action, opting to see if the Health Care Authority came through with its decision before that meeting. At this point, making a decision in the dark and then having to change course later seemed a bit too iffy.
“It’s really just about the parties agreeing — the Health Care Authority, public hospital district and the existing nonprofit,” Berg said.
Commissioner Ryan Farrer suggested they table any discussion of a decision, and wait to see what happens in the coming weeks.
“We could also call a special meeting at any time,” added Commissioner Pete Scroggs.
Other business
• The commission cancelled its next meeting on Oct. 14 since the members plan to attend training that day for hospital district commissioners. The board’s next regular meeting will be at 6 p.m. Tuesday, Oct. 28.
• Board members were introduced to several administrators of the current hospital on Tuesday night, including Chief Operating Officer Larry Kahl, Chief Nursing Officer Cynthia Walsh and Harbor Medical Group Executive Director Josh Martin. Harbor Medical Group — a limited liability corporation operated under the umbrella of the hospital — provides billing and staffing services for many doctors, medical offices and hospitalists on the Harbor.
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