Adam Spencer, The Triplicate

In the face of widespread community opposition, the Sutter Coast Hospital Board of Directors voted last Thursday to "postpone indefinitely" efforts to switch governing control of the hospital from a mostly local board to a Bay Area-based panel in a move often called "regionalization."

"After thoughtful consideration, we have decided to postpone indefinitely efforts to make Sutter Coast part of Sutter Health's West Bay Region," said a Friday letter addressed to Sutter Coast Hospital employees and medical staff signed by Sutter Coast board chairman Ken Hall, as well as the hospital's CEO and the president of the Sutter Health West Bay Region.

"It has become increasingly clear that conversations regarding what regionalization means and doesn't mean for this community and the hospital have diverted attention from a more significant priority: securing the long-term viability of Sutter Coast," the letter said.

Opponents noted regionalization had already been postponed through a preliminary injunction obtained by the Del Norte Health Care District in October - a decision that Sutter Coast and Sutter Health have appealed and continue to fight.

"Although the Board is postponing any further discussion on regionalization, the legal process will continue in order to provide clarity around this issue moving forward," said Sutter Coast CEO Eugene Suksi in an email to the Triplicate.

Dr. Kevin Caldwell, a member of the Del Norte Health Care District's subcommittee for the court case against Sutter, said the vote to postpone did not go far enough.

"I think this move by the hospital board to postpone the regionalization is a move in the right direction, but it seems fairly hollow since they are still going full speed ahead in the court of appeals and in the arbitration - those two things are what's hurting this community," Caldwell said by phone on Monday. "We are spending all of our money keeping them from regionalizing and I think if they were really sincere about putting regionalization on hold they would put the court actions on hold also."

Caldwell said the district has already spent more than $50,000 on attorney fees for the case with Sutter and has learned that the district's half of the arbitration cost will be at least $115,000.

Dr. Gregory Duncan, Sutter Coast board member, the hospital's chief of medical staff and a vocal opponent of regionalization, said that the motion to put regionalization on hold came unexpectedly from Hall at Thursday's board meeting.

Hall could not be reached Monday for comment.

The board did not rescind it's 2011 vote to regionalize, just "postponed indefinitely," which Duncan said is an important distinction since as it stands there are fewer steps standing between the status quo and regionalization than there would be if the vote was rescinded.

Duncan said Monday that during the Thursday meeting, he told other board membersthat "the litigation in the court of appeals is not necessary. We already have arbitration scheduled. What this does is make the expense a lot greater for the county."

"The injunction preserves the status quo pending a decision by the arbitrators on the merits of the case," Suksi said by email, adding that Sutter Health believes the trial court erred by issuing the injunction since the Del Norte Health Care District's case is based on an expired lease. "We expect the arbitrators to rule in our favor, in which event the injunction would be dissolved."

For now, the hospital board will not discuss regionalization further, instead focusing on a "third party study focused on strategic options to enhance the long term viability of the hospital," Suksi wrote in the email.

The study will include an analysis of the advantages and disadvantages of various options, including making no changes. Under other options, Suksi wrote, Sutter Coast "remains part of Sutter Health in its current governance structure, but pursues alternative business strategies such as: a. Seeking joint ventures; b. Reconfiguring services and/or developing service lines;c. Pursuing Critical Access Hospital (CAH) designation; or d. Identifying alternative rural funding."

The alternatives to be analyzed also include "Other options (e.g. affiliation with another health care system, move to freestanding status, etc)," Suksi wrote.

Duncan has often mentioned Asante Health System (which operates hospitals in Grants Pass and Medford) as having an interest in partnering with the Crescent City hospital.

The Friday letter to hospital employees and medical staff acknowledged how the regionalization debate has alarmed the community:

"We are now keenly aware that in order to have a constructive conversation about the best path forward to preserve this hospital's long-term viability our internal audiences and community's leaders must first have a solid understanding of the challenging environment in which we operate to provide context for any decisions moving forward," the letter said.

Meanwhile, citing the Health Care District's limited resources, the Del Norte County Board of Supervisors today will consider approving and sending a letter to the state Attorney General's Office asking for assistance in investigating legal concerns pertaining to the move to regionalization.

"Prior to and during this litigation, Sutter Health executives and attorneys have made repeated inaccurate and misleading statements to this community, which may rise to the level of fraud and conspiracy," the proposed letter states.

Tonight, Duncan will present information on regionalization at a public meeting hosted by the Del Norte Tea Party Patriots at 6 p.m. in the county fairgrounds Arts and Crafts building.

"I will be presenting information on how Sutter Health's policies drive up your health care costs, and providing specific examples of 'inaccurate' statements which Sutter Health executives have made to our community as they try to take ownership of our hospital," Duncan wrote in his most-recent newsletter.

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