S.L. Surgery Center Caught in the Middle of Hospital Fight

CENTER THREATENS LITIGATION IN HOPES OF EXPEDITING SALE; LEGAL BILLS HIT $1.5 MILLION
By Steven Tavares

The San Leandro Surgery Center has become the neglected child in the long-running custody battle between Sutter Health and the Eden Township Healthcare District over the fate of San Leandro Hospital.

Before tensions between the two entities increased earlier in the year as the District countersued Sutter’s attempt to takeover the hospital, administrators at the East 14th Street center believed a deal was set.

In late January, Sutter was set to purchase the District’s interests in the facility for just over $1 million, but activists rose in opposition to any further financial transactions with Sutter while the two sides battled in court. The board eventually put off approval of the sale for the next two monthly sessions with mistrust over Sutter’s intentions for the small surgery center prevailing.

In the meantime, administrators at the surgery center have become increasingly antsy for a resolution. Their anxiety became so high that they have now threatened the District with litigation. A letter earlier this month from the surgery center called for the District to move forward on the sale, effectively saying, “Or else!”

Despite the threat of legal action, the District’s plans for the surgery center remain in a holding pattern in regards to any deal with Sutter until their legal disputes are settled. When that could be is anybody’s guess.

LEGAL BILLS MOUNTING? A staffer for the Eden Township reported last week the hospital district has spent nearly $1.5 million in legal bills since the beginning of litigation with Sutter Health in November 2008. Included in the total is $190,000 for the month of August alone.

Sensing reporters might latch onto this rapidly increasing total, District Chair Carole Rogers, striking a rallying chord, said the outlay of monies won’t matter once they are victorious in court. “We when prevail, Sutter will reimburse these fees,” she said.

On the legal front, movement between Sutter and the District may be coming to a head by the end of the year. Lawyers for the District filed a lengthy motion Sept. 15 for summary adjudication. In the meantime, San Leandro Hospital is nearing one year on so-called borrowed by virtue of their legal maneuvering. Sutter had announced last year they would close the hospital Sept. 30, 2009, but that never occurred. One county official, spun the rising legal costs for the District this way: it would have cost them between $6-9 million in subsidies to keep the hospital open, according to many estimates. By spending $1.5 million in legal fees and getting their desired result–keeping the hospital open–the District is actually saving money.

NO HEALTH CARE FOR DIRECTORS Chair Carole Rogers already has free health care, but she is worried about attracting the next generation of Eden Township directors, who might not be so lucky. Rogers recently pushed for offering health care benefits to future directors, hoping to bring new and younger voices to the board, but the she ultimately ended up in a minority of one.

“I’m not sure it would attract people,” said Director Dr. Vin Sawhney. “If they run, it’s because they want to be here, not for the benefits.”

Director Dr. Rajendra Ratnesar agreed and said he was not comfortable using District funds as an enhancement to an elected position. “I don’t think we can justify this,” said Ratnesar. “It may be a misuse of public funds.”

It is typical of most hospital districts to be populated by people with backgrounds in the medical field and Rogers and others have pushed for different voices, such as those with resumes in finance, to come forward. Three director’s seats are up for re-election this November. Director Dr. Bill West and Rogers are on the ballot, while Dr. Harry Dvorsky chose not to continue his decade-long stint on the board.

Attorney Lester Friedman and Susan Reisz, a nurse are also on the ballot. Friedman had interviewed last year to replace former member Dr. Walter Kran. That seat was given to West. Reisz recently received the endorsement of the local Democratic Party. Both are viewed as candidates sympathethic to the current board’s drive to save San Leandro Hospital through the courts.

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