An ad hoc committee of the Palm Drive Hospital board officially received Friday afternoon two physician-backed proposals aimed at continuing operations at the troubled Sebastopol hospital, which is slated for closure April 28.
The more comprehensive proposal put forth Friday came from Dr. Jim Gude, head of the hospital's intensive care unit, Dan Smith, a longtime hospital supporter and former board member, and the Palm Drive Health Care Foundation.
The 37-page proposal (See .pdf), titled Physician Proposal to Reinvent Palm Drive Hospital, would essentially transfer management of the hospital to the foundation and consolidate the intensive care unit, ICU, and medical surgical services in the existing 5-bed ICU.
The existing medical surgical beds would be temporarily moth-balled with the possibility of reusing them in the future for more financially viable services. The management structure would allow the hospital to maintain its current licensing, said Gail Thomas, secretary of the foundation.
Thomas, the foundation's point person for the proposal, said just before the meeting the number of full-time equivalent, or FTE, employees would be reduced from 128.3 to between 104 and 115.
"We're not shutting down a ward, we're consolidating an ICU and med/surg ward," Thomas said.
The proposal calls for reducing expenses by 40 percent while only suffering a 20 percent loss in revenue, Smith said.
A second proposal was made by Dr. Michael Bollinger, a prominent Sebastopol orthopedic surgeon who operates at the hospital. According to the proposal (See .pdf), Bollinger and and other doctors who formed a group called Physicians United propose leasing the hospital for $1 a year and closing down the medical surgical department.
The group would initially offer an intensive care unit, radiology, lab and outpatient services and specialty surgery center with at least 5 beds. Management of the hospital would be outsourced to a third-party contractor and the physicians group would only have 10 fulltime staff members, plus additional part-time staff.
The Physicians United group would be willing to lend more than $3 million to the hospital. As collateral, the group proposes placement of a lien on the hospital property.
That point raised concerns among some of the members of the ad hoc committee, who said that the hospital district cannot legally rent out more than 50 percent of the hospital without a vote of the public.
Committee members also questioned whether it was legal to put a lien on hospital property.
St. Joseph Health in Sonoma County, which runs both Santa Rosa Memorial and Petaluma Valley hospitals, responded to Palm Drive's request for proposals with a "letter of interest."
The letter, from St. Joseph President Todd Salnas, states that St. Joseph supports "participating in solutions that would preserve access to identified outpatient medical services" in the Palm Drive Hospital community.
The correspondence is the first public statement made by one of Santa Rosa's three large hospitals addressing the impact of Palm Drive's closure or transition.
In the letter, Salnas said St. Joseph could not put together a proposal given the "aggressive RFP time frame. But a more detailed and thorough proposal could be crafted in the near future, he said.
Members said the goal of Friday's meeting was to receive the proposals and quickly review whether they satisfied a set of criteria that will be used to score the proposals.
The criteria, among other things, include listing a comprehensive business plan; providing the names of key executives, along with their qualifications; describing what health services will be offered; and outlining the governance structure.
The proposals will now be reviewed and scored by hospital officials, including hospital CEO Thomas Harlan. The hospital board is expected to consider the proposals along with staff input at its next meeting on Wednesday.
(You can reach Staff Writer Martin Espinoza at 521-5213 or martin.espinoza@pressdemocrat.com.)
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