|Ocala, FL -
August 28, 2012|
And then there were three.
Marion County Hospital District trustees voted this week to eliminate one of the four health care companies interested in leasing Monroe Regional Medical Center.
The unanimous move Monday by the district's trustees came after Ardent Health Services, which owns 13 hospitals in New Mexico and Oklahoma, significantly reduced the amount of money it was offering for the 421-bed Ocala facility.
"They let us know this was not a high-priority item for them," David Atchison said Monday. Atchison is a Ponder & Company executive.
District trustees hired Ponder & Company to help find health care companies and negotiate a lease deal.
The trustees are entertaining lease bids as a means of generating money hospital executives say is necessary to remain competitive. They also are offering voters the choice to approve a hospital tax referendum in November. The tax would generate an estimated $65 million over five years. If the referendum passes, the trustees are expected to forego any new lease agreement for the foreseeable future.
The other interested health care companies are Community Health Systems, Duke LifePoint Healthcare and Health Management Associates.
Munroe Regional Medical Center is owned by the state-sanctioned Marion County Hospital District and is 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 also are district trustees.
The lease proposals are part of ongoing communications between the district trustees, Ponder and the health care companies. The financial offers from the companies change as information is shared among the three parties.
Before proposing that Ardent be struck from the list of possible leasing companies, trustee chairman Jon Kurtz said Ardent's current offer would not have placed it in the top four had it been made last year.
Ardent's revised offer was $120 million with no commitment to capital improvements. The original offer was for between $275 million and $325 million, which included $150 million to pay for the trustees' capital improvement plan for the facility to remain competitive.
As part of the candidates' latest offers, Community Health Systems increased its offer slightly, to $406.7 million, which included $150 million for master facility plan capital improvements. Tennessee-based Community Health Systems owns or leases 135 hospitals in 29 states.
Duke LifePoint Healthcare, a joint venture of Duke University Health System and LifePoint Hospitals, also slightly raised its offer to $375 million for a 40-year lease.
Health Management Associates, which owns or leases 70 hospitals, raised its offer to between $440.2 million and $500.2 million.
As part of the most recent offers, Community Health Systems would allow the Marion County Hospital District to have a representative on its board for the first five years of the lease. Duke LifePoint Healthcare would allow the district to have final approval on the hospital's CEO. Health Management Associates would allow some of the current district trustees to make up a part of the new Munroe board if it leased the hospital.
The three companies also addressed district trustee fears that a lessee would drop unprofitable, but important, medical services.
Community Health Systems agreed not to discontinue or substantially reduce hospital services for at least five years. Duke LifePoint Healthcare promised to continue all of the hospital's core services, including obstetrics, pediatrics and diabetes programs. Health Management Associates said its would keep Munroe's medical programs in place, but might have to adapt to a changing health care environment.
Ponder also assembled the companies' employee satisfaction reports. Overall satisfaction was highest with Duke LifePoint Healthcare, at 88.3 percent. Second was Community Health Systems, with an employee satisfaction rating of 85 percent. Health Management Associates was at 76 percent.
The next step will be for the candidates to make presentations in October to hospital district representatives and continue to discuss specifics about a lease agreement.