Hospital changes anesthesiologists as step toward growth

Following a management strategy that in the last six months has brought the financially ailing hospital $1 million ahead of budget, the board voted to replace North Bay Anesthesiologists, whose contract had expired, with Anesthesia Consultants of Marin.
Finance Committee Chair Alden Brosseau, who introduced the measure, said the recommendation did not reflect on the clinical performance of North Bay Anesthesia, who had served the hospital for many years, but that the change was a business decision. “The bottom line,” he said, “is this: In order to approach our goal of increasing the amount of surgical services we provide at this hospital, we need to have certain standards.” Brosseau went so far as to say, “While the contract cannot guarantee financial success, the status quo guarantees failure.”
The reputation, track record and abilities of the new anesthesiologists, said hospital Chief Executive Officer Carl Gerlach, will be a competitive asset. He explained that “our highest survival priority” is to increase surgical volumes. “We’ve done well financially this year to date,” he said, “but we’re facing some challenges.” The market share in ambulatory services is low. In 2007, it was about 25 percent. This is bad for residents and bad for the hospital. “That means,” said Gerlach, “that 75 percent of the residents who get ambulatory surgery leave the area and travel unnecessarily, from a clinical point of view.” That represents surgical business the hospital does not have.
Further, there’s been an “exodus” of surgeons, Gerlach said. The first of his two reasons – the fall-out from failed bond Measures C and F – was corrected with the passage of Measure P, he said. But the second factor, competing enterprises, is gaining strength. As an example, he said, joint venture ambulatory surgery centers where physicians are able to participate in the bottom line are extremely damaging to hospitals. “So, many hospitals have taken it upon themselves to create a joint venture with the idea that it’s better to have part of a pie than none at all. We have seen the effects of this particularly in January.” He warned that the numbers for this month could reflect a downturn and reminded the board that while the bond measure was necessary, it was not sufficient. “We’re not going to do the ‘Mission Accomplished’ thing,” he said. “We won the election, but now we’ve got to work our butts off. And [the new anesthesia contract] is part of it.”
Dr. Gian Nhan, a member of North Bay Anesthesiologists, defended the group’s clinical performance, but said he understood the hospital’s need to grow.
Board member Dr. Richard Kirk said he supported the decision and acknowledged the sensitivity of the action. “It’s a heart-rending shift to make… But I agree with your decision to go with what we need to improve our performance.” Board member Madolyn Agrimonti said, “The ground has shifted. There’s a whole new way that we have to look at the operation of hospitals. We need to support the 81 percent of the people who said, ‘We believe in the future of this hospital.’”
Board member Peter Hohorst said he would support the measure “on the basis that this is the best management staff we’ve had.” And board chair Bill Boerum said, “The future is always imponderable and filled with uncertainties,” in support of the change.