
Countering The Continuing Shell Game Practices of Sutter Inc.
Marin Hospital District Election Counters Theft
By Carol Sterritt
Until sixteen years ago, the Marin had its own community hospital. It served the needs of the public regarding trauma care, hospitalization and certain outpatient activities. The county also had a thriving community clinic, a decent mental health crisis unit, and most importantly, the confidence that when health failed an individual, patient care just might come before profits. How much we have lost?
In 1986, due to what could be regarded as a nifty little game of insider trading, conflict of interest, and out and out theft, Hank Buhrmann, the then president and CEO of Marin General Hospital, and Quintan Cook, the then general counsel for the Hospital, finagled a legal document of significant power and questionable ethics. In essence, they transferred the assets of the hospital from community control to corporate control. The plot was contrived but profitable-by creating a new corporate structure, to which the hospital assets were assigned. Buhrmann made his moves "with the clear understanding that he would become the new corporate entity's CEO. Stated differently, the District's CEO then advising the District Board as to the propriety of the proposed MGH lease, became CEO of the private entity to which over $100 million of public assets were transferred." (Material quoted from reports written by Linda Remy.)
Likewise Quentin Cook was "employed simultaneously as general counsel to the Healthcare District and as counsel to an existing corporation renamed MGH Corp. Cook was counsel to MGH Corp. even while he was counsel to the District. He created California Healthcare Systems (CHS) which owned Marin Health Systems (now Marin Community Health (MCH)), the entity that manages MGH Corp." (Again from Linda Remy.) Thus began an interesting venture of a shell game that has gone on ever since. And since the mid-nineties, the name of the corporate dealer who now controls Marin General is Sutter. I don't know about you, but I do know that following the logistics of all this makes my head spin. As time has gone on, the structuring of Marin General's day-to-day operations seem more geared to profits than to patient care. One significant and troubling aspect of various rearrangements of hospital care was the lack of a full-time neurosurgeon. Is a trauma center a trauma center without a neurosurgeon?
Recent investigators representing the American College of Surgeons came to Marin and asked this question. For two days this past August, they heard testimony from various corporate officials employed by Marin General Hospital. The College heard a wide range of comments from community participants. As the Coastal Post goes to press, the word is out: "Marin General Hospital will be issued the go-ahead to become a level two trauma unit." This means that the hospital will be required to have on hand a neurosurgeon at the hospital, not simply on call. It represents a clear victory for those activists long troubled by the idea that serious head trauma cases might continue to be helicoptered over to the East Bay for treatment.
Several members of the College expressed to me that the manipulations of Buhrmann and Cook belonged in the same league as the Enron dealings. Of course, their ruling on the level of trauma care came about by examining even such minute details as to whether or not a child with a head injury would benefit more from transfer to an out-of-area hospital with a pediatric neurosurgeon, or whether that child would be better off with the immediate availability of the level two type trauma center here in Marin.
As reassuring as this trauma center upgrade is, Sutter's possible response will quite likely be to protest. Sutter might cut back services in one or more areas in order to make up the profit loss that this ruling might entail. Sutter's policies indicate repeatedly that they prefer expenses labeled capital improvement over labor costs. Sutter preferred the expense of building a heli-pad rather than paying a neurosurgeon.
There is also the insidious game plan by which expensive consultants are advising administrators at Sutter's. The advice often involves taking the profitable services out of MGH and putting them into free-standing centers. For instance, MGH is asking the community to consider donations to build a separate same-day surgery center. This center will be built, off-site. Therefore, its assets will not be held in common with MGH assets, but will be independent of MGH.
Why would Sutter do this? Well, we are fast approaching that point in time (certainly by the end of November 2002) in which the District Board overseeing the Hospital just might finally have its day in court. The District Board is hoping that the California Appellate Court will soon rule in its favor, that there are indeed grounds for overturning the 1986 lease arrangement due to the conflict of interest. Should that lawsuit be heard, and ultimately won, Sutter could be required to return MGH to the community. Therefore, Sutter's interests require them to strip MGH of all profitable services beforehand, leaving the community with an empty shell.
It is interesting that the Hospital's Corporate Board has never contested the content of the lawsuit. It contests only two things: (1) that a lawsuit is not valid because the statute of limitations has expired, and (2) that the lawsuit is forcing the Corporate hospital to spend money on legal prowess that it ought to be spending on community affairs. The Court will determine the validity of point one. And point two is spurious at best-Sutter makes far and away enough profit off MGH to fund community affairs. It just prefers not do so.
Examine further: of the 26 hospitals in Sutter's chain, only two are leased. And no other hospitals in the chain are as profitable as MGH. MGH is a cash cow that is milked in several ways. One is that there is no oversight of capital expenses by either the public or the Hospital District Board. Do the shell game managers siphon off a little here and there for themselves? Do they contract work by using a fair bid system, or one loaded with ample kickbacks or nepotism? And what about the fact that the 1986 agreement forces the hospital to purchase supplies from designated suppliers, whose prices might be as much as 22% higher than the going rate?
Now We The People have a say in these matters. Election time is upon us, and there are clear choices at hand. Three people on the ballot are vastly aware of these issues, and devoted to crusading for the community at large. Their names are Jennifer Rienks, a health systems analyst, Dr. Lawrence Arnstein, and Dr. John Severinghaus. They represent the will of the community.
Also running is two-term incumbent Suzie Coxhead. She has never met an idea from Sutter that she did not like. However, her latest mailer lists her philosophy as having all the attributes of a community-minded candidate. Can you say well-paid political consultant, Boys and Girls? Apparently he has whispered in her ear that she should let the voters know that she stands for five things "highest quality trauma care, 24/7 neurosurgery, "district-funded grants to community agencies, "MGH and County expansion of mental health, and "hiring of more nurses." These are all good ideas, but four of the five are things that she has consistently not supported, out right vetoed or only supported in a watered-down fashion over her last two terms.
Don't be fooled. Vote early, vote often. And make the Community Three of Rienks, Severinghaus and Arnstein your selection.
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