Board Asks State to Investigate Hospital Merger

The Camarillo Health Care District Board voted Friday night to ask the state attorney general to investigate the merger of Pleasant Valley Hospital and St. Johns Regional Medical Center in Oxnard.

The 4-0 decision was in response to the refusal of the Pleasant Valley Hospital to guarantee a full-service facility for at least eight years and make the district a third party in the merger, board members said.

Dr. Gerald Karpman, a board member up for reelection, said “the hospital didn’t respond adequately to our request,” but he would not say what the hospital’s response was.

State Deputy Atty. Gen. Jim Cordi said the state attorney general’s office always looks at hospital mergers. “All mergers of charitable organizations must give the state a 20-day advance notice before a merger,” Cordi said.

But David Henninger, an attorney representing the health district, said the board’s request could affect the attorney general’s review process, which he called “fairly perfunctory.”

“There will be a real impact on the process,” Henninger said.

Board Vice President Gary W. Norris said the district decided to “raise the issues for the attorney general,” hoping that by doing so, the board will get a satisfactory services agreement from the hospital.

Board members said at a special meeting Friday night that the hospital has not accepted any of its demands, including a request to keep service charges down if the hospital is making money and to keep basic emergency services at the hospital.

The board’s demands stem from concerns of Camarillo residents that once the merger occurs, they will be unable to stop services from being cut or prevent the hospital from being closed.

Henninger said the district is asking the attorney general “to look at specific issues, such as whether the merger is in violation of a charitable trust doctrine.”

The charitable trust doctrine is a state law that requires a nonprofit organization, such as a hospital, to fulfill the purpose it was set up for. Once the trust has been established, the hospital’s assets cannot be used for non-charitable purposes.

For example, in a 1977 case, the Queen of Angels Hospital in Los Angeles was found in violation of charitable trust when it proposed to stop operating a full-service hospital. The corporation had proposed to use its assets to operate a local clinic and fund a pension plan.

Sheryl Rudie, a spokeswoman for Pleasant Valley Hospital, declined to comment about the district’s action, saying only that the hospital board “thinks it’s in line with the charitable trust doctrine and that it would continue to provide the services to the community.”

With three board members up for reelection, the low-profile panel has been under heavy pressure from citizens’ groups to obtain an acceptable services agreement from the hospital. Five candidates have challenged the incumbents, three of the challengers campaigning on the promise of taking the hospital away from its present owners, a nonprofit organization that took over the operation of the hospital from the district in 1983.

John Rush, a candidate who attended the meeting Friday, said he worried that the district was “coming in with too little too late.”

“If they don’t take a more aggressive stance, we’ll lose the whole thing,” Rush said.

The district has already spent $52,000 of its $1-million budget to fight the merger and has canceled a nutrition program to pay legal fees and experts.