The Facts Behind the HCCA/Tulare Regional Medical Center Partnership

page13A lot has been written in this publication lately about Tulare Regional Medical Center, and unfortunately much of it isn’t true. We appreciate the opportunity to relate the facts about the hospital and it is our hope this publication will start to verify facts before publishing stories filled with mistakes, unattributed opinion and rumors.

The verifiable facts

Here are the facts – all verifiable by public records. At the end of 2013, we almost lost Tulare Regional Medical Center. That would have been a devastating blow to the community, causing more than 500 people to lose their jobs and forcing tens of thousands of people to drive to outside cities for emergency medical services. It would have caused irrecoverable economic devastation to Tulare.

The hospital was on the verge of bankruptcy, losing more than $1 million per month, with less than 30 days of cash in the bank, a construction project in complete disarray, and no plan to turn things around.

The Board of the Tulare Local Health Care District was tasked with finding a solution.

After an exhaustive search that lasted months, and its recognition that none of the other interested parties could do the job, the Board took a step that saved our hospital: It entered into an agreement with HealthCare Conglomerate Associates to manage the hospital. When HCCA stepped up and presented a plan that allowed the hospital and its assets to remain publicly owned yet have its operations run like a private business, the Board said it had finally found the right partner.

This unique public-private partnership has infused Tulare Regional Medical Center with fiscal responsibility and strong leadership, while leaving full ownership of its assets in public hands. Bottom line: HCCA provided the best – and frankly the only – opportunity to turn the hospital around and set it on a path to a sustainable future.

Rather than the District filing bankruptcy and laying off hundreds of people, HCCA re-hired the entire staff and gave them pay raises. Management empowered the staff to make key decisions and these improved patient care, and the hospital’s overall performance.

Tulare Regional Medical
Center’s Dramatic Turnaround

Tulare Regional Medical Center has now completed 24 consecutive months of profit and had an annual return last year better than in the past twelve – all confirmed by not one, but two financial audits and an upgrade by the national firm Fitch Ratings. Coming on the heels of three straight years of financial losses, and the closures of other hospitals in California, the turnaround here in Tulare has been nothing short of remarkable. In fact, it has been recognized nationally and HCCA leadership has been invited to national hospital conferences to discuss this incredible success story.

Beside the financial turnaround and the saving of hundreds of jobs, there have been many other accomplishments. In March 2015, HCCA re-opened Lindsay Medical Office, providing that community with access to much-needed, close to home, medical services. HCCA also opened the West Street Medical Office and launched a permanent school-based community medical office in Earlimart, the first of its kind in Tulare County.

Led by Chairman Dr. Benzeevi, HCCA created an environment at the hospital that empowered team members to make decisions to improve the hospital and apply their full potential.

There were other changes that made a difference. HCCA streamlined the hospital’s management structure, renegotiated vendor contracts and set Tulare Regional Medical Center on a path to success.

The road has not been easy and some recent changes made to improve the hospital’s performance and the quality of patient care led to resentment – and caused some negative news coverage.

Doctors’ Leadership Reform

In January, the Board voted to end its affiliation with its prior medical staff organization and affiliated with a new medical staff.

The same 130 doctors who served the hospital before retained their exact same clinical privileges to practice at TRMC. The only significant difference is that there is a new group of doctors leading our team of dedicated physicians.

The old group of supervising doctors had not been acting in the best interests of the hospital and community for years. They had taken many steps that hindered the hospital’s progress, including filing a frivolous lawsuit against the Board’s chairwoman – a lawsuit that was quickly thrown out of court. A judge ordered them to pay her legal bills.

When the board chose a new medical staff leadership group, the old leaders did what they do best, create disruption and distraction, and file yet another lawsuit. They asked the court to immediately return them to power. However, here again, Tulare County Superior Court rejected their request, stating in a well-reasoned opinion that, based on the evidence, it was unlikely they would prevail at trial.

In recent weeks, this newspaper has published a few articles that sought to discredit the progress that we’ve seen at TRMC. These articles, especially those authored by David Adalian, were tainted by sloppy mistakes, factual errors and bias, rendering them effectively meaningless.

One of these articles erroneously described the medical staff change this way: “Tulare Hospital Board discharges entire medical staff.” This is inaccurate in that not a single doctor was discharged in the change. All doctors retained the same rights they always had to practice at the hospital.

Setting the Record Straight

The most recent of these articles, titled “Deal Gives HCCA Exclusive Right To Buy Medical Center,” contained so many errors that it leads to the conclusion that the author is either inept or deliberately biased. For reasons that are frankly unclear to us, that author has chosen not to follow standards of fairness and ethical journalism that other newspapers follow.

This article, erroneously stated that the contract between the District and HCCA was “largely kept concealed.” In fact, the contract and all associated documents were available for the public to examine before the Board voted on it, was described in detail by the Board’s attorney during an open public meeting, and was on the hospital’s (TRMC) public website for no less than 9 months afterward. Even now, all these documents are available upon request to any member of the public.

That same article wrongly said the contract gave HCCA an exclusive right to buy the hospital at a future date with “no restrictions.” In fact, the contract states that the right cannot be exercised without prior approval by the District’s voters – the public, who own the hospital. The article states that voter approval is not required. That’s a false statement of the law.

Even if the voters approve the sale, the hospital must be sold for its full market value at that time (which includes all value added by any construction project.) As owners of the hospital, the public always retains the right to sell its assets. Should the public ever vote to sell the hospital (at fair market value at the time of the sale), HCCA retains the right of first refusal.

The article contained another error, falsely stating that HCCA charges the District a 30% surcharge for employee salaries and is allowed to “bank” the “over-payment.” In reality, HCCA uses that amount to cover employee benefits, including health insurance.

Here is the answer that HCCA provided to Mr. Adalian, which he to this day has failed to include in the online version of the story: “The 30% is being used to pay employee benefits, including health insurance, and is not being banked to purchase TLHCD assets. … This is an excellent deal for the district as typically companies charge a 30% surcharge for leased employees above and beyond the salary and benefits.”

The article left the impression that HCCA has set itself up to steal the hospital. Nothing could be further from the truth.

To be clear, HCCA has zero intention to buy the hospital. And if it ever did, the deal would have to be approved by the registered voters in the district and sold at its full market value at that time.

The false statements in these articles are not harmless – they cause real damage. They do not “inform” the public, but rather they misinform the public. They do absolutely nothing to enhance our community and, in fact, harm our ability to ensure sustainable emergency care to our community. We strongly urge the paper’s publishers to carefully consider their responsibility to the public and to our community to publish fair and accurate stories. A good start would be including both sides of the story, and making a basic effort to verify allegations before reporting them as fact.

Kathleen Johnson is Vice President of Marketing for HCCA/Tulare Regional Medical Center.

The Valley Voice in no fashion agrees with the above—in any assertion—but rather seeks to clarify a thorny situation. The Voice and its staff bear no ill will either toward TRMC or HCCA. It is the opinion of the paper that, in allowing this response, the purpose is to allow clarity. The Voice can only report on facts presented to its staff, whether someone reaches out to us, or we reach out to others. Being that HCCA representatives have not returned several calls, we have not always been able to present their side in our reporting. It is unfortunate that they have lowered themselves to such an uncivil tone.

16 thoughts on “The Facts Behind the HCCA/Tulare Regional Medical Center Partnership

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  1. Wow. Nice article. Its good to hear that TRMC was saved by HCCA. However there are alot of smoke and mirrors going on here. Kudo’s to Mr Aguilar and Ms. Martin-Soares for seeking the truth. I’m glad HCCA saved the hospital but wheres the money? This hospital was asked by the Grand Jury to show the money so where is it? Was the bonus of several million to the current CEO part of it? Was the hiring and firing of the previous CEO part of it? He got alot of money to go away. When are the people of Tulare going to stand up and say enough BS already. This tower should have been done and now sits empty. These hard working and dedicated staff members deserve better as well as the community. Stop the spin and show us where the money went. May this Board and CEO finally do what is right for once and quit blowing smoke. At this point none of them are to be trusted.

  2. The beginning of this article starts out with wanting to verify facts and then immediately goes into mistakes, unattributed opinion and rumors.

    First, which “verifiable” records indicate the hospital was almost lost at the end of 2013? With 30 days of cash in the bank, while not strong, it was definitely not on the steps of bankruptcy. Spending could have definitely been curtailed in the year 2013 by the board if it was so dire. Verifiable records will show that money was continuing to be spent to open clinics all over the place when the District should have been concentrating on fulfilling the responsibility that the voter’s entrusted them with in 2005 with the $85 million dollar bond.

    Even within bankruptcy there would not have been loss of jobs. Southern Inyo Hospital, that HCCA currently manages, is in bankruptcy and employees are currently working. TRMC is using threats like this to scare the community. Such as if we don’t pass another bond the hospital will close. Another inaccuracy is that all were hired, there were some let go, including some that had been speaking up and attending board meetings.

    The board was tasked with finding an alignment partner and they had a great description of what they were seeking for the District. The strange thing is that HCCA could not have fit the description but yet they were selected over the four other proposals that had experience in operating a hospital with proven track records. Now it is being presented that no one else could have done the job. In a recent board meeting Linda Wilbourn commented that all the others were going to close the Emergency Room, again another scare tactic. I was told by someone that the District has no records on those proposals per the District attorney Bruce Greene. So much for verifiable records. They can’t even produce a copy of the plan that HCCA submitted.

    If this remarkable financial turnaround is nationally recognized and so wonderful why is the Board asking for another $55 million? How is the Board able to do that to the tax payers and at the same time continue to spend money on clinics in Lindsey and Earlimart that are not part of our property tax base? If it is so strong why hasn’t the landscaping of the hospital been kept up? Does empowering team members mean staff have to take on positions they aren’t qualified or trained for?

    The medical staff issue is going to play itself out in the court. All I am going to say there is a lot more to this story and there has been for years. Favoritism and bias, neither in the best interest of the community.

    Again, some misstating of facts in regards to the Management Service Agreement (MSA). It clearly indicates taxes, benefits and workers’ comp. are reimbursed by the District. Per the meeting minutes of 8.25.14 it states “Legal Counsel noted the Board approved the first amendment to the MSA on 7-30-14 which changed how the 130% surcharge was calculated for the leased employees and reserved HCCA the right to use the surcharge as an offset.” This amendment changed the 130% to be just on base compensation, prior to that it was on everything including employee expense reports. Strange thing is the attorney during the describing of the contract on 5.28.14 never even mentioned the 130% to the board.

    If HCCA had ZERO intention to buy the hospital why did they file the Option with the County of Tulare on 7.3.14, a scant 36 days after signing the MSA.
    Let’s start to really get to facts not threats. We all want long-term success of the organization but continuing to say “Let’s go forward and ignore the past” is just asking for the same path to continue.

    • I think Bruce Greene is TLHCD’s attorney, as well as HCCA’s. How is this allowed to fly? But even if he’s only HCCA’s attorney, why does HCCA employ a real estate attorney?

        • If the negative people could put some of all the negative talk into working side by side with HCCA… INSTEAD OF FIGHTING ABOUT EVERYTHING HCCA HAS DONE FOR THE PEOPLE AND THE COMMUNITY…. JUST STOP BEING SO NEGATIVE… ALL OF US SHOULD BE THANKFUL AND APPRECIATE WHAT HCCA DID FOR OUR HOSPITAL…They came in and fixed the mess the hospital was in and Saved 500 jobs, saved all of our home values from crashing and saved “Our Hospital!!!!!!!!!!!!!!!!!!

          • Not everthing is positive about this hospital. I think all comments are welcome if they are not mean spirited or insulting.

  3. Great letter this only touch on a couple of issues. There are alot of other things that don’t add up BIG NO FROM ME ON THE BOND

  4. I heard something very interesting the other day…..it seems that all the binders for the oversight committee were lost. Alberto would always take his home and so his was the only one saved.
    Where’s the Oversight Binders that were in the care of the Hospital?

  5. Exactly how may ‘rehired staff’ were there, since 2/3 of the hospital were already outsourced to various companies.

  6. I was employed by Tulare for 22 years. Never written up, never misse work, loved my job.. Until the new administration started. With all the horrible things that they did to employees I saw fir to finally speak up. Went to the board meeting,a few, and defended the employees and how we felt. I did this on a few occasions. When HCCA took over I was handed my walking papers. No reason given, just get out. Devistated at age 59 with no job. Talk about being thrown under the bus..there we several long time employees that we laid off…
    This is my thorn that I need to get over. But will probably have a very hard time to forgive.

  7. I was employed by Tulare for 22 years. Never written up, never misse work, loved my job.. Until the new administration started. With all the horrible things that they did to employees I saw fir to finally speak up. Went to the board meeting,a few, and defended the employees and how we felt. I did this on a few occasions. When HCCA took over I was handed my walking papers. No reason given, just get out. Devistated at age 59 with no job. Talk about being thrown under the bus..there we several long time employees that we laid off…
    This is my thorn that I need to get over. But will probably have a very hard time to forgive.

  8. We need to come together as a community and vote NO on the 55 million dollar bond. This board took the easy option to ask for the bond rather then finding other methods to fund the tower project. I have no faith on the current hospital adminstartion but foremost I don’t trust Benzeei.

  9. ER care is terrible . They need to fix immediately. One doctor on duty . Six hour waits. Where did the first bond money go. It is our money explain or we can replace the board. No doctor should sit on the board.No new bond until they explain.

  10. I would like to know how our reporting causes “real damage,” as stated in this article–especially when the latter states, “Tulare Regional Medical Center has now completed 24 consecutive months of profit and had an annual return last year better than in the past twelve – all confirmed by not one, but two financial audits and an upgrade by the national firm Fitch Ratings.”

  11. Shedding light on a subject and encouraging everyone to share their thoughts/questions and experiences regarding TRMC by no means cause “real damage” to this hospital. The ones who have caused “real damage” is the Board of Directors whose arrogance and heavy handedness brings about distrust and anger from many Tulareans. Keep up the good reporting Valley Voice as loyal readers and citizens of Tulare rely on you.

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