Emily Jo Cureton, The Triplicate

Regionalization on hold, at least for time being

Some call it an unavoidable business merger that may save the hospital; others a corporate takeover that will ultimately shrink the range of medical services available in Del Norte.

Whatever the proposed "regionalization" of Sutter Coast Hospital really is, or really means, it's on hold by court order, for now.

On Thursday, Del Norte Superior Court Judge John Morrison granted the Del Norte County Health Care District's petition for a temporary restraining order against Sutter Coast Hospital and the Sutter Health corporation, barring the local affiliate or its corporate controller from taking any further action toward merging Crescent City's hospital into a region with five other facilities and two medical foundations, all overseen by one board of directors based in the Bay Area.

Regionalization would dismantle the longstanding local board of

directors in charge of one hospital. Nine out of 10 people on this panel

live Del Norte or Curry counties, while all are appointed by Sutter

Health. Last November, this board voted 9-1 in favor of shifting its

powers to a regional authority, without holding public meetings about it


The backlash has been considerable: the Health Care District, the Del

Norte County Board of Supervisors, a group of local doctors and

increasingly more citizens are up in arms - at public meetings, in print

and now, in court.

Besides staying regionalization, the temporary restraining order

prohibits Sutter Health from downsizing or reorganizing any departments

at the hospital, particularly billing; or changing the designation of

the hospital in any way that would reduce the level of services

currently being provided.

The order expires Aug. 27, when a hearing scheduled for 9 a.m. may

extend the restraints until the case is resolved, said the attorney for

the Health Care District, Martha Rice.

The crux of the Health Care District's argument for legally halting

regionalization rests on a 1985 lease agreement between a public entity

and a private healthcare provider, which contains stipulations about the

organization and future governance of the local hospital.

"Sutter believes the District's claims are without merit as they are

based on a 1985 lease that expired by its own terms when Sutter Health

built and opened the new hospital in Crescent City," wrote hospital CEO

Eugene Suksi, in a statement distributed to hospital employees and the

board of directors Friday morning.

"There were provisions in (the lease) that were intended to last

beyond the lease and one of those was the understanding that the local

board would govern the hospital," Rice told the Triplicate.

Dr. Greg Duncan is the hospital's chief of medical staff and the only

vocal opponent of regionalization who's on the current board and

therefore allowed to attend the closed meetings where hospital decisions

are made. His declaration to the court states that what's at stake here

"will deeply affect the quality of health care available to residents

of Del Norte County."

Suksi's declaration effectively says the opposite, calling

regionalization a way to enhance hospital sustainability, provide

additional resources for hiring and retaining doctors, and lower costs

through consolidated management.

The defense attorney is Michael Duncheon, representing both Sutter

Coast Hospital and the Sutter West Bay Region.

The West Bay board may consider a resolution to approve the merger at

its Sept. 20 meeting, Duncheon's declaration states.

As for fears that regionalization is the first step toward reducing

the number of beds available at the hospital in order to utilize a

federal funding mechanism:

"It may be one of the alternatives considered," Duncheon's

declaration states.

However, "No application (for Critical Access Designation) is

pending," he wrote, "Nor will any be made this year. Moreover, if and

when such an application is made, it would likely take more than a year

to be completed and acted upon."

In 1985, the Health Care District struck a deal with a company then

known as Sutter Community Hospitals of Sacramento, which financed and

built a new hospital on donated land along Washington Boulevard. Since

then, the company has grown into a multi-billion-dollar non-profit

corporation with 30 affiliated hospital campuses, five medical

foundations, seven specialty surgery centers and 30 clinics spread

throughout California and Hawaii.

Del Norte's sole general hospital is one of only two Sutter

affiliated facilities that have not been consolidated under regional

management since 2008.

Community organizers have collected about 900 signatures in

opposition to regionalization, Duncan said. A town hall meeting on the

issue is scheduled for July 25 at 6 p.m. at Crescent Elk Middle School.

Reach Emily Jo Cureton at ecureton@triplicate.com.