|Ocala, FL -
May 21, 2012|
Published in the Ocala Star Banner - Monday, May 21, 2012 at 8:54 p.m.
Marion County Hospital District trustees voted Monday to ask voters in a November referendum to approve a $65 million general bond, half the amount trustees originally considered more than a month ago.
If approved, the Munroe Regional Medical Center referendum would mean a property tax increase of as much as one mill for five years, or $1 for every $1,000 of taxable value after the homestead property tax exemption.
If the referendum passes, the money would be enough to pay for three years worth of capital improvements. Trustees agreed Monday night not to use the money to pay off some of the hospital’s $100 million debt.
The amount is far short of the $150 million consultants told the hospital it would need to spend to remain competitive in the future.
But despite voting for the referendum, trustee Chairman Jon Kurtz warned that the tax would not be a cure-all.
“We shouldn’t kid ourselves. All we’re doing is filling in short-term (needs),” he said.
When the money runs out “our backs are up against the wall,” Kurtz said, citing predictions that the hospital will likely be facing more financial problems in 2017.
Joe Hanratty, who voted against the referendum, said the bond’s approval would only postpone the inevitable.
“Where does that leave us in the end of two or three years ... or does it mean (we’re) kicking the can down the road?” Hanratty said.
Hanratty instead supports leasing the hospital to a private hospital company. That strategy could generate about $300 million, including $150 million for capital improvements. The rest could be spent on health care issues throughout the county.
But trustee Dr. Mike Jordan said the short-term $65 million fix would allow the hospital time to assess coming changes in health care wrought by Obamacare, Medicaid and Medicare and whether those changes will offer hospitals like Munroe some financial relief.
And in three years the trustees could again come back to the bond issue and determine if more is needed, he said.
Originally, trustees were considering a $130 million bond issue to retire some of the hospital’s $100 million debt and reroute more money toward improvements, such as building more single-bed hospital rooms.
The bond and tax increase referendum, which does not require Marion County Commission approval, would cost a homeowner whose house was valued at $100,000, with a $50,000 homestead exemption, an additional $50 annually.
Meanwhile, the Strategic Options Workgroup, created by trustees to make recommendations about leasing or selling the hospital to a health care group, also continues its work. The workgroup is in discussions with four health care groups about a potential lease.
The drive behind the push for tax help or a lease is the hospital’s finances.
Hospital executives have had to dip into their reserves and rely on their Wall Street investments to make ends meet almost annually.
Also driving the search for money is an earlier hospital study that showed Munroe would need $150 million in capital improvements to remain competitive. The not-for-profit, public hospital, often the hospital of last resort for the poor, has a higher-than-typical number of indigent patients, more bad debt and high Medicaid/Medicare case loads.
Munroe Regional Medical Center is owned by the state-sanctioned Marion County Hospital District and overseen by seven trustees who are appointed by the County Commission. The seven trustees currently lease the hospital to Munroe Regional Health System, Inc., which is overseen by a 13-member board, some of whose members are also district trustees.