Letters to the Editor

Editor –
Your recent editorial correctly noted that the emergency room is the hospital feature most valued by voters. That was confirmed by surveys conducted by the Sonoma Valley Health Care Coalition. However, we worry that you imply an even smaller hospital with an ER is what we need, that it could be built on the cheap, and that it would survive with a little parcel tax support.
As the Coalition’s detailed Report of Findings and Recommendations indicates, that is simply not so. A full copy of the Coalition’s Report is at www.svhcc.blogspot.com.
Most people understand by now that the law requires an ER to be attached to a hospital with essential ER-related support services (e.g., operating room, intensive care unit, laboratory, pharmacy, x-ray/imaging, etc., etc.). The Coalition Report makes clear that ER’s loose money. Ours loses a bundle, not only because it treats a percentage of uninsured (as federal law requires) and because insurance companies and government are stingy payers, but because by law it must be staffed 24 hours a day, even when it sits empty – as it often does.
It is good when our ER sits empty. Yet there is no escaping the irony that without other offsetting revenue, the very aspect of the hospital we value the most is also its biggest money loser.
You suggested taxpayers might be asked to subsidize a money-losing, bare-bones, ER-oriented hospital at the ever-higher levels it would continually require. However, for reasons noted in the Report, it is foolish to think they will, or should.
Without a viable business plan that attracts new doctors and non-ER patients and keeps ever-rising costs in check, any new hospital — no matter where built — will be broke before it opens, leaving taxpayers with a seismically sound white elephant and 30 years of bond debt. The Coalition found that voters are not eager to pay a lot even to build a hospital that makes money, and certainly not for one that won’t.
While there are no guarantees, the Coalition concluded that the 56 bed version (20% less than the 70 beds proposed for Measure C and 33% less than the current hospital’s 83 beds) is the configuration most likely to avoid the need for future subsidies.
Nor is smaller better. Unique design and seismic requirements influence hospital size and those have changed remarkably since our present hospital was built in the 1950’s. The base cost of even a stripped-down hospital is such that, after all the numbers are crunched, the price difference between a well-configured 56 bed version and a 25 bed hospital is relatively small (roughly $130 million versus $100 million). The revenue-generating muscle of 56 beds vs. a 25 bed hospital, however is dramatic: a $4.3 million annual positive cash flow versus an $800,000 per year loss. Covering that loss would require a continuing parcel tax in addition to the property tax needed to fund the $100 million construction cost. “Ability to make money,” not “cheapest to build” is the key to hospital survival. The Coalition found that below a certain configuration revenues begin to go south dramatically.
And what the numbers do not say is that the quality of service of the 25 bed hospital will be worse than the 56 bed hospital because it will often be on diversion, and the doctors practicing in the smaller hospital are likely to be less proficient because they do fewer procedures.
Finally, you noted that the school district will be seeking a parcel tax this fall. That vote will come only 6 months after passage of the latest hospital parcel tax, before an anticipated hospital construction bond tax measure, and just when new water, sewer and garbage rate hikes take effect.
How taxpayers will react to the prospect of tax increases for basic utilities, for schools (with a shrinking student population) and for a hospital (with a growing senior population) is anybody’s guess. But all the ingredients for a Perfect Storm are clearly there. All the more reason not to delude readers into thinking that a tiny, bare-bones hospital, not all that much cheaper to build and which could quickly become known as “Our Lady of Perpetual Subsidy,” would be an easy sell.
Steve Pease and Bob Edwards
Formerly, Co-Chairs of the
(Former) Sonoma Valley Heath Care Coaltion