The Tulare Local Healthcare District scored a legal victory Wednesday by convincing a judge to allow it to separate from its current management company. Later that day, the district’s board voted unanimously to temporarily suspend most of the hospital’s operations to prevent the state from shutting the hospital down.
Richard Gianello, a consultant for the board, claimed that Healthcare Conglomerate Associates (HCCA) — the company contracted to manage Tulare Regional Medical Center — indicated it would begin winding down its operations at the hospital.
“I also understand that there was a notice that was submitted by HCCA today, by their attorney today, suggesting that they’re in the process of transferring patients and terminating the employees and dealing under the WARN act, which is the process that you go through to do that,” Gianello said.
The company’s move came after a court victory earlier that day, that would allow the district to exit its management agreements with HCCA as soon it finds an alternate operator to run the hospital, or by November 27, whichever comes first.
If HCCA chose to exit the hospital without a clear handover plan, the California Department of Public Health would order the hospital be closed to protect the safety of its patients, according to court filings and to the board’s legal counsel.
A forced shutdown would likely be coupled with hefty fines and a laundry list of requirements to reopen; by voluntarily and temporarily suspending the hospital’s operations, it wouldn’t be subject to fines, and could reopen in a quicker, more expeditious manner.
Although the district has lined up Community Medical Centers of Fresno to run the hospital, the company hasn’t officially applied to the state to take over operations; any hospital operator or manager must be authorized by the state.
“The state needs a licensed, approved operator of the hospital,” Niki Cunningham, an attorney for the board, stated.
Closure Not Immediate; Employees Still Show Up To Work – For Now
The hospital’s employees should still show up to work for now, Xavier Avila, a hospital board member, told the Voice.
“The state requires that the emergency room stays open for thirty days,” Avila said. “You don’t want people that show up with an emergency, and the hospital’s closed.”
The departments that the emergency room relies on would also stay open for the same amount of time.
The board and its consultants had differing hopes on the length of time that the hospital would stay closed.
Gianello initially stated that he hoped the closure would be “maybe thirty to sixty days” — but that was on the far end of what the board wanted.
“Thirty or sixty is unacceptable to me,” Kevin Northcraft, the board’s chairman, said, stating his vision of a best-case scenario could be as little as “five to seven days.”
Gianello later stated his vision of a best-case scenario would be a closure time of only one week.
Given the circumstances, the temporary closure was the best of the worst, the board’s attorneys and consultants stated.
Even a scenario in which Community Medical Centers could come in tomorrow wouldn’t be workable, Cunningham told the public, because of logistical issues.
“We don’t have access to all the financial records — we don’t have simple things like all the passwords to the computer systems,” she said.
Responding to one question from the audience, she stated the hospital couldn’t simply operate by naming a CEO, either, she said.
Because the state knows that Community Medical Centers would be serving “in a management role,” they wouldn’t allow the hospital to continue operating under its own license with a CEO in a management position.
What Would Close?
Cunningham stated that it wasn’t clear what might stay open or what might close.
“We haven’t fully evaluated this — this is all very recent and very new news,” she said. “If the board move forward with the voluntary, temporary suspension, we’re going to try to keep whatever facilities and operations open that are hospital.”
Evolutions and the hospital’s clinics would likely remain under HCCA’s control until a new operator came in, Avila said.
“Until the contract’s actually broken — until we have a plan that the health department accepts,” Avila said, “it remains in his control.”
The Best of a Bad Situation
Northcraft told the public that the board, its attorneys, and its consultants had tried to work with HCCA to ensure a smooth transition to another management company.
Those negotiations didn’t work out.
“This is because HCCA won’t agree to back out and give us the reins,” Avila said. “That’s really it. It would be really easy for [Dr. Benny Benzeevi, CEO of HCCA] to work with us and the health department and say this is what we’re going to do, and there really wouldn’t be any need to shut this down.”
“We’re stuck. This is a hostage situation, and he’s using the employees as the hostages,” Avila continued.
Northcraft stated that while the decision was a difficult one, it would ensure the hospital’s survival.
“We’re looking at options that are pretty bad on a short-term basis,” he said, “but on a long-term basis, we see a vibrant, quality, and successful hospital in our future. We’re trying to keep our eyes on that.”