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Consultant lays out options for Munroe Regional

Privatization would inject money into the hospital, but at a cost.

Ocala, FL - October 18, 2011

Published in Ocala Star-Banner on Tuesday, October 18, 2011 at 12:46 p.m.

Any private company hired to help run Munroe Regional Medical Center can be expected to infuse the hospital with much-needed cash, but will also want to control major business decisions, a consultant told Munroe officials Monday.

The consultant, Ponder & Co. from Chicago, was hired by the Marion County Hospital District trustees to study options for addressing the long-term financial needs of the hospital, which is projected to start running in the red sometime in the next few years.

Ponder's study will be overseen by a Strategic Options Workgroup comprised of hospital trustees, board members, doctors and administrators.

At the workgroup's first meeting Monday night, much of the discussion centered on partnerships with private hospital companies.

Ponder identified 14 for-profit and not-for-profit companies that might be interested in operating Munroe as a so-called joint venture partnership. Those companies could be expected to invest millions of dollars in upgrading and possibly expanding Munroe, but in return would expect to control major decisions affecting the hospital.

Eb LeMaster, of Ponder, said that while one goal of the study will be to maintain as much local control as possible over Munroe, some loss of control is inevitable in a partnership.

"You're opening up the group of decision-makers beyond the (Munroe) health system and trustees," he said. "At the end of the day, (a private company) is going to want control of many of those elements."

While most members of the Munroe Workgroup were not surprised by that revelation, several expressed concern that sharing decision-making power with a partner who is focused on profits could jeopardize the quality of health care provided by Munroe.

As a public hospital, Munroe enjoys complete control over the types of services it offers, its prices, staffing, standards and all other aspects of its operation.

Dr. Harvey Taub, a Munroe physician and member of the workgroup, noted that Munroe would need the approval of their partner to expand the hospital or add services.

"The for-profit majority owner could say, ‘We like the profit/loss the way it is' and veto it, right?" Taub asked.

"The short answer is yes," said Dave Atchison, a Ponder executive.

Ponder officials said the exact powers of each partner in a joint venture would be spelled out in a written agreement. Through that agreement, Munroe could compel its partner to maintain certain standards, keep particular services intact, and do other things that ensure the quality of the hospital.

Munroe CEO Steve Purves agreed.

Before joining Munroe, Purves had been the CEO of a hospital that was operated jointly by the Sisters of Charity and the nation's largest hospital company, HCA, in South Carolina.

When the Sisters of Charity took on HCA as a partner, Purves said, it stipulated that the company build a satellite hospital, which HCA did. But when the Sisters later asked HCA to take on a $30 million expansion of the main hospital, the company declined.

"Ultimately, that led to the dissolution of the joint venture," Purves said.

The Munroe Workgroup did not make any decisions Monday. Its charge over the next 30 weeks will be to work with Ponder to examine all the possible partnerships that could buoy Munroe's financial position.

The workgroup will eventually make a recommendation to the Hospital District trustees, who also are considering asking for a tax to support the hospital.

The group meets next on Nov. 21.

http://www.ocala.com/article/20111018/ARTICLES/111019707/1001/NEWS01?Title=Consultant-lays-out-options-for-Munroe-Regional


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