Plan Would Keep San Bernardino Hospital Open

As financially troubled hospitals close around the state, the medical staff at Community Hospital of San Bernardino announced a plan Friday to try to keep the 96-year-old hospital open for the area’s mostly working-class residents.

The 321-bed hospital has struggled to stay open while losing about $1 million per month for two years. In March, it laid off 78 employees and eliminated 147 positions.

Experts hired by the medical staff drafted a business plan to sever ties with the hospital’s owner, a subsidiary of Catholic Healthcare West, and operate as an independent nonprofit hospital. The experts include investment bankers, healthcare authorities, lawyers and representatives from financial manager Merrill Lynch.

The team introduced its plan Thursday night to the hospital’s board of directors and representatives from Catholic Healthcare West, all of whom are still reviewing it.

“It is extremely important that this hospital stay available and viable for the people, regardless of whether they can pay,” said Donald Nelson, an investment banker who is on the team.

Representatives of Catholic Healthcare West, California’s largest not-for-profit hospital operator, said they have never proposed closing the hospital, but would consider any plan to solve its financial problems, even it means selling. They would not suggest a price.

“We are willing to review any viable proposal,” said Susan Whitten, a vice president.

Hospital representatives provided few details of the plan, except to say that the hospital’s doctors have agreed to give up a portion of their salaries and promised to help to raise funds to buy the hospital from Catholic Healthcare West.

To draw more insured patients, the plans also calls on doctors to form a multiple-specialty group to win contracts with private insurance carriers.

“The entire staff is united in this goal,” said Dr. Bharti Jain, the hospital’s chief of staff.

More than half of the hospital’s patients are uninsured or underinsured, and hospital officials say the state does not reimburse it for the entire cost of treating such patients.

The financial problems also are tied to higher malpractice insurance rates and growing labor costs.

The hospital, with about 1,000 employees, treats about 3,000 emergency patients per year. Its closure, doctors say, would put an added strain on nearby Arrowhead Regional Medical Center, the county-run hospital in Colton.

The San Bernardino County Board of Supervisors had considered buying the hospital, but several board members said they will instead wait to see if the medical staff or another group can save it.

Community Hospital of San Bernardino is not alone in its struggle. In two decades, more than 100 community hospitals have closed in California, according to a July 2001 study by Shattuck Hammond Partners, a consulting firm. There are about 450 acute-care hospitals in the state, according to the state Department of Health Services.

On Wednesday, San Jose Medical Center announced it would close in December after losing more than $28 million in two years. It is the sixth hospital this year in California to close or announce plans to close.

Some hospitals have overcome their financial problems. Four years ago, Catholic Healthcare West closed Long Beach Community Medical Center after huge loses. But it reopened in 2001 thanks to community volunteers who helped raise $15 million.

Bruce Satzger, president of Community Hospital of San Bernardino, said speculation that the hospital may close has worried the staff. But he said managers are committed to keeping it open.

“The bottom line is that nobody wants to close the hospital,” he said.