Adam Spencer, The Triplicate

The Del Norte Healthcare District says that current costly litigation with Sutter Health is preventing it from funding community health projects that would usually fit the bill.

Since the film-based dental X-ray arm that slowly revolves around patients' heads at the Del Norte Community Health Center has become a bit outdated, the clinic hopes to replace it with a digital panoramic machine.

The current film-based X-ray machine requires costly disposal of hazardous chemicals. Each image takes several minutes to develop and results are often inconclusive, necessitating a second scan that exposes patients to additional radiation.

A digital panoramic radiograph develops images instantly, without chemicals, and results can easily be shared via email to other dental offices.

That was the case made last week by Dr. Robert Chiang of the local Open Door clinic during a compelling presentation to the Del Norte Healthcare District board that asked for funds for the digital X-ray machine to the tune of $30,000.

It's a project that would usually be "tailor-made" for the healthcare district, according to board member Kevin Caldwell, but the district's budget has been dominated by litigation fees spent in the past year for its case against Sutter Health. The district board said it simply couldn't afford it but hoped to be able to fund the machine in the future or support its purchase in other ways.

The healthcare district has spent more than $163,000 on attorney's fees for its case against Sutter Health and Sutter Coast hospital, based on the district's belief that Sutter's attempt to dissolve localhospital ownership and/or downsize the facility is in violation of a 26-year-old lease agreement between Sutter Health and the healthcare district.

"We're in a different situation than the healthcare district has ever been in before," said board member Shellie Babich, referring to the district's finances at last week's meeting.

Last fall, a superior court judge granted the district an injunction preventing Sutter Health and Sutter Coast from eliminating local ownership and control, often called "regionalization" or downsizing the hospital to qualify as a critical access facility.

At that time, visiting Judge Leonard LaCasse said that "I'm only here to preserve the status quo until there's a final determination."

LaCasse ruled that the determination would be made via arbitration, as outlined in the lease agreement.After some legal rescheduling, the arbitration is scheduled to begin July 10.

With Sutter Health appealing the injunction in December, the healthcare district is also in litigation with the company in the California Court of Appeals.

District board members grumbled about having to spend money on both the arbitration hearing and the case before the Court of Appeals, saying that they had asked Sutter Health to drop the Court of Appeals case since the matter should be resolved in arbitration anyway.

Sutter Health executives have said that the appeal was made because they believe the injunction was improperly issued in the first place.

Healthcare district board members believe it's just another way to drain the district's coffers, citing Sutter Health's inquiry into the district's finances, which are public information, as soon as the litigation started.

Meanwhile, Sutter Health and Sutter Coast kicked off their strategic options study last week, which is intended to resolve the regionalization and critical access controversy by conducting an in-depth cost-benefit analysis of all possible options for Crescent City's hospital, including eliminating local ownership via regionalization and downsizing to a critical access facility.

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