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Amid dozens of emotional pleas to keep Palm Drive Hospital open, members of the hospital board voted 4-to-1 Monday night to shut down core services at the financially strapped Sebastopol hospital.

The move could force the temporary closure of the entire hospital by April 28.

At a public meeting at Community Church of Sebastopol, the Palm Drive Hospital District board approved a resolution that would cease acute inpatient services and close the emergency department by April 28. The board's lone dissenting vote was cast by Jim Maresca.

Before the board voted for closure, an amendment to the resolution was made that committed the board to making all effort to "provide a continuity of care" in whatever way possible. During the meeting, hospital officials announced that they had filed for bankruptcy protection earlier Monday.

"It was a very difficult night for all of us in the community," said Board President Chris Dawson. "But we're going to make every effort to make this transition process work. We believe what we're doing keeps more options open than not."

About 250 attended the meeting, with many of them pleading that the board delay the vote. Many in the audience were hospital staff, including nurses and doctors.

Dawn Gideon, managing director of Huron Consulting Group, which has been contracted by the hospital to assist in the restructuring and closure processes, said Monday that inpatient services could be closed as soon as April 21 and the emergency department by April 28. She said the public would be notified through the media and public signage at the hospital.

Gideon also said an ambulance would be stationed at the hospital for three months after closure in case a patient shows up needing emergency care. That patient would then be transferred to another local hospital.

Several doctors put forth proposals for taking over operation of the hospital under a foundation model. They urged the board not to close the hospital, even temporarily, because it would cause an exodus of health care professionals.

"We're going to continue to work the board as much as we can to try and make something work," said Dr. Michael Bollinger, a local physician who has a plan that would convert the hospital into an elective surgical hospital for both inpatient and outpatient.

"But it makes it more difficult with the hospital closure and declaration of bankruptcy," he said.

Hospital officials said the suspension of Palm Drive's license as a general acute care hospital will require the hospital to shut down for a period while it transitions to a more sustainable health care model that could include an urgent care center and outpatient services.

But many pleaded with the board to delay closure and withdraw the bankruptcy filing.

"What is the hurry? What is a week going to do, or two weeks? Don't make a decision in haste. You're going to be back in this mess," said Sabina Schulz, a registered nurse who works for Kaiser Permanente Medical Center in Santa Rosa.

Schulz, a member of the California Nurses Association, attended the meeting in support of fellow nurses at Palm Drive.

Mary Maki-Rich, a Palm Drive emergency department nurse who has worked at the hospital for 33 years, said she and others would have been willing to sacrifice some of their pay.

"There are probably people here who work at Palm Drive who are willing to take a decrease in pay," Maki-Rich said.

Many speakers condemned the board for not involving the public sooner in their search for solutions to the hospital's current fiscal crisis.

"Shame on you you didn't talk to a single physician," said Dan Smith, a longtime hospital supporter and former board president who several years ago contributed up to $2 million of his own money to keep the hospital open.

Smith said later that the hospital should have had Monday's meeting a year ago, when the hospital's financial situation wasn't so dire. He said that would have allowed for the transition away from an acute inpatient hospital to an urgent care center that offers outpatient surgeries.

"The problem is they didn't plan a transition," Smith said. "What I'm trying to do is support the physicians and their proposals .<TH>.<TH>. all we want them to do is keep the lights on and the water running."

A number of proposals were put forth and members of the public asked the board to hold off on the vote until they could be examined more closely and even put into effect before shutting down the facility.

In outlining his proposal, Bollinger said the hospital would be managed and owned by a foundation. Before the vote was taken, he pleaded with the board not to close the hospital's doors or suspend the license because it would have a negative impact on the future of the hospital.

"You lose personnel if you close the hospital," Bollinger said. "People are fleeing. The ship is going down."

Dr. Jim Gude, a local physician with a longtime Palm Drive affiliation, suggested that management of the Palm Drive facility could be put in the hands of the Palm Drive Health Care Foundation, a nonprofit founded in 1999 when a group of local investors rescued it from closure. The following year, voters created a public agency to buy the hospital and approved a property tax to pay for it.

Under Gude's proposal, inpatient services and the emergency department could be replaced with outpatient services and an urgent care center, possibly under current licensing.

The vote Monday follows a board vote last week authorizing Palm Drive managers to put the hospital back into bankruptcy. The hospital previously filed for bankruptcy protection in 2007 and emerged in 2010 when it sold $11 million in bonds to pay off debt and underwrite future improvements.

Hospital officials have said they need to eliminate services that are draining Palm Drive's finances. Continuing health care trends away from inpatient service and toward outpatient services has resulted in fewer overnight stays, even as both private and government insurance reimbursements decline.

Harlan said that since last year, the hospital has seen a 30 percent decline in patient admissions, and that in the current fiscal year, the facility saw nine straight months with an average daily census of only 9 patients a day. Some days the daily census drops to just 5 patients, officials said.

Palm Drive CEO Tom Harlan said two-thirds of the hospital's patients are insured by Medicare, Medi-Cal or have no insurance at all. Hospital administrators say that Medicare historically has paid only about 90 percent of a hospital's costs of providing care, Harlan said.

"If it's only eight or nine patents a day, the unit cost is extremely high, we can't afford that," he said, adding that the hospital's proximity to Santa Rosa hospitals, which are currently expanding services, is putting extreme financial pressure on the hospital.

"Unfortunately, Palm Drive is out of money. We're unable to pay vendors that supply critical services to our patients," Harlan said. "I think the frightening thing for me and my staff is that even now, we're having extreme pressures in making sure we have adequate supplies for inpatient care."

Hospital officials said the hospital has had to cancel surgeries because it's having trouble procuring supplies.

"We looked at every possible combination. Unfortunately, there's nothing that works with such a low an acute census," Harlan said.

At the meeting, hospital officials said the county was willing to give the hospital district a $2 million loan that would be used to transition the hospital to some new model.

The board said the bankruptcy filing allows the hospital, with the help of the court system, to keep vendors from demanding payment for previous services.

"Bankruptcy allows the hospital to continue ordering and paying for supplies going forward and not deal with how much it owes vendors in the past," said Michael Sweet, an attorney representing the hospital.

"What that does is create some breathing room for the board. It creates an automatic stay on collections," said Sweet.

Hospital officials insist they've looked at every possible financial and business permutation to keep the hospital running. Each scenario was modeled around keeping open the emergency department, but none of these scenarios was financially sustainable organization, officials said.

Administrators have set up an email address at thefuture@palmdrivehospital.com and are urging the public to send in comments and suggestions about the hospital's direction.

Last week, hospital officials said Palm Drive's intensive care unit is losing $930,000 a year and its clinical laboratories are losing $800,000 a year.

At the meeting Monday, Bollinger said his group, which he's named Physicians United, could offer the hospital a loan to make payroll and relieve some of the financial pressures it now faces.

Sebastopol residents decried the possible loss of Palm Drive as an emergency and inpatient facility.

Sebastopol Mayor Robert Jacob said the people have a right to be angry, given the loss of medical services and jobs that would come about from closing the hospital. But Jacob said he hopes "we will all come together in this moment of crisis" to determine the future of the facility.

Dr. Jorge Gonzalez, who heads Palm Drive's emergency department, said he laments the loss of the hospital and its "amazing" staff. Permanent closure would prevent the hospital from replicating its nationally recognized services.

"I think we have a unique gem here that allows us to treat patients as though they are family members," Gonzalez said, adding that resource will be lost if the hospital closes.

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