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Nov 4th DMC directors unveil plan to avert closure, preserve full-service hospital

 

Doctors Medical Center directors unveil plan to avert closure, preserve full-service hospital

 

Proposed “5 x 8” shared commitment plan relies on contributions from other East Bay hospitals, local government, industry, DMC employee groups, and West Contra Costa Healthcare District taxpayers

 

SAN PABLO, Calif., Nov. 3, 2014—In the continued effort to prevent the imminent closure of 60-year-old Doctors Medical Center, West Contra Costa Healthcare District directors on Tuesday plan to discuss a last-ditch strategy to keep the hospital open and restore emergency department services through 2019.

 

Dubbed the “5-by-8” plan, the proposal relies on a combination of debt relief, new revenue sources, and on-going and new spending reductions. The package would have to be agreed to by the Contra Costa County Board of Supervisors and other East Bay hospitals, the city of Richmond, unions representing DMC workers, and West County voters, who would be asked to pass a new parcel tax measure.

 

If it all came together, hospital projections show DMC could close an approximately $20 million annual operating shortfall, and move from running yearly deficits to achieving a modest operating surplus by 2016.

 

“This is achievable but only with shared commitment and sacrifice,” said Eric Zell, chairman of the West Contra Costa Healthcare District board of directors. “The time for action is now for all of us who have an interest in saving and finding a sustainable future for a full-service DMC.”

 

Irma Anderson, retired nurse, former Richmond mayor and a West Contra Costa Healthcare District board member, said that without fast action and comprehensive agreement, the hospital board would have no choice but to move forward with closure and replacing DMC with an Urgent Care Clinic.

 

“We heard from the community loud and clear—save DMC,” said Anderson. “We took another hard look at what it will take, and this is it. But it can't be done piecemeal. It's all or nothing.”

 

Zell and Anderson, on behalf of the Board, plan to discuss their proposal at a joint District-County DMC Governing Body meeting starting at 4:30 p.m. Tuesday in the DMC auditorium. At the meeting, District directors also are scheduled to receive a final report from a regional planning group chaired by Contra Costa County Public Health Director Dr. William Walker and sponsored by the Hospital Council of Northern and Central California. This regional planning initiative explored options in the event of closure of DMC, in an effort to preserve some of the services the hospital has provided to West County residents.

 

Zell and Anderson are calling the new proposal 5 x 8 because it would put DMC back on a sound financial footing for five years by bringing to bear eight fiscal tools—some of which already are being implemented and others that would require approval by and the support of other stakeholders.

 

“I think once DMC had to close some services, such as ending ambulance visits to the emergency department, the threat of the hospital completely shutting down became real for the community and the hospital's many stakeholders,” Zell said of the timing of the new proposal. “That new acceptance of reality has led to new conversations that clearly couldn't happen before.”

 

According to projections by interim CEO Dawn Gideon, DMC could close a $20 million fiscal gap through the following:

 

  1. A new District parcel tax raising $5 million to $8 million a year starting in December 2015.
  2. Contra Costa County forgiveness of money owed the county from advances on parcel tax revenue worth $3 million a year.
  3. Long-term debt support from other area hospitals of between $1 million to $4.3 million annually.
  4. Corporate and community contributions to a reinvigorated DMC charitable foundation generating $500,000 to $1.5 million annually.
  5. Continued operating efficiencies saving $3 million to $5 million a year.
  6. Payroll and benefit savings of $4.7 million to $7 million a year.
  7. City of Richmond reallocation of Chevron community benefits funding worth $5 million a year, for three years.
  8. Increased health insurance reimbursement rates worth $500,000 a year based on establishment of a medical training/residency partnership starting in 2017.

 

Contra Costa County Supervisor John Gioia, whose district includes DMC and who is a member of the Healthcare District Governing Body, applauded the renewed effort to save a full-service DMC and emergency department.

 

“I am ready to move quickly on getting Board of Supervisors support to forgive payments owed to the county by DMC,” Gioia said. “It is important for all the stakeholders to immediately come together to preserve this key component of our public health infrastructure.”

 

A copy of a presentation on the 5 x 8 plan is available here at the West Contra Costa Healthcare District website.