The nonprofit foundation that wants to reopen Palm Drive Hospital and take over its management has asked a federal bankruptcy judge to intervene in its stalled talks with the hospital board.
The Palm Drive Health Care Foundation, which has been negotiating for weeks with the hospital district board, filed a legal motion on Friday requesting a court appointed mediator "to resolve an impasse" that is preventing the hospital from reopening.
For its part, the hospital board, filed legal papers opposing Monday opposing the foundation's request for a court appointed mediator.
In early April, the hospital board both filed for Chapter 9 bankruptcy and approved the closure of the cash-strapped facility, citing crippling competition from Santa Rosa hospitals, especially Kaiser Permanente, declining overnight patient stays and reduced health plan payments.
The legal filings are further signs of the acrimony that has developed between the hospital board and the foundation that for years supported the hospital with millions of dollars in private donations.
"The bankruptcy court may not agree with us, but we are looking for a means to find a good solution to work for all of us," said Gail Thomas, a key negotiator for the foundation.
Thomas said one of the goals of the Chapter 9 bankruptcy process is to keep public entities — in this case the hospital — functioning while their financial issues are resolved.
The foundation's legal motion states that "the foundation's essential and achievable plans to re-open the hospital should not be allowed to languish another day as a result of the board's failure to openly engage the foundation."
Chris Dawson, president of the hospital board, said he was surprised by the foundation's legal maneuver. He said the last meeting between the hospital board and foundation was last Wednesday, and that both sides had agreed to put out a press release stating that talks were ongoing and that progress was being made.
"Having a mediator involved just doesn't make sense," Dawson said.
Dawson said there continue to be a number problems with the foundation's proposal, including its plan for governance, its financial projections, proposed clinical services and lack of a qualified executive management team.
Dawson also said a court-appointed mediator is not needed since the hospital board is also in talks with other interested parties, including St. Joseph Health in Sonoma County, which has expressed interest in possibly providing physical therapy and urgent care services.
"I don't think its necessary," he said. "We're talking to other people."
When asked how long the hospital would remain closed, Dawson said, "I can't answer that."
You can reach Staff Writer Martin Espinoza at 521-5213 or martin.espinoza@pressdemocrat.com
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