PeaceHealth is willing to enter into a 50-year contract with San Juan County Hospital District in which the healthcare company would purchase land for, build, operate and maintain a new medical facility on San Juan Island.
The hospital district would subsidize the operations of the new Integrated Medical Center at an amount not to exceed the current Inter Island Medical Center tax levies.
"We've made considerable progress," said board chair Lenore Bayuk. "And we're very excited about where we're at...We are not going to carry a general obligation bond....There are no new taxes needed."
The progress on the contract negotiations were discussed at the January 20, 2009 hospital district board meeting. More details are still to be worked through. When a final draft is completed, it will be available to the public for review for at least two weeks and most likely a month prior to the board vote. A sign-up sheet will be available for community members to request copies.
PROPOSED CONTRACT HIGHLIGHTS:
Initial term of the contract:
50 years, renewable by mutual agreement.
Philanthropy will provide $10 million toward construction costs
PeaceHealth will fund the remaining $20 million for the land, facility construction and equipment. This major change since the Letter of Intent responds to community concerns about taxpayers financing the new facility.
PeaceHealth will fund the operations of the new Integrated Medical Center (IMC).
SJCPHD#1 will subsidize PeaceHealth for contracted services, including 24-hour emergency room services, capped at an amount not to exceed the current IIMC tax levies.
No new IIMC taxes will be needed.
The addditional levy that expires in 2016 does not have to be extended.
PeaceHealth will own the land, facility and the equipment with full responsibility for operation and maintenance.
The new IMC will be governed by a Community Board, with a majority membership of island residents. The Community Board will be responsible for oversight of the IMC's quality, safety and operating performance and will have powers delegated by the PeaceHealth Board.
The IMC will provide regular reports on services, quality measures and outcomes to the Hospital District Board.
Quality of Care:
High quality of care, meeting both PeaceHealth's and the Joint Commission's National Standards will be maintained. PeaceHealth has a long-standing national reputation for outstanding patient care and safety.
Termination by PeaceHealth:
This is a 50-year contract, with PeaceHealth holding the responsibility for $20 million in financing for the new facility.
PeaceHealth will be highly motivated to continue operations at the IMC since their debt obligation will continue whether the IMC is open or closed.
PeaceHealth may not terminate operations during the first 10 years.
After 10 years, in the unlikely event that PeaceHealth should not be able to continue operations, it may terminate then, but PeaceHealth will continue to be responsible for the remaining debt on the new facility.
If PeaceHealth were to terminate operations, the Hospital District:
would receive at least three years notice.
would have first right to purchase the land, facility and equipment at the then appraised fair market value
would be appropriately credited in any purchase agreement for initial philanthropic funds provided by the community.
A brochure outlining the proposed contract will appear in islanders's mailboxes in the next few days.
San Juan Community Hospital committee members will be available to answer questions at MarketPlace grocery store periodically during the next few weeks.
Other outreach sessions are being organized.
For additional information visit www.sjcommunity hospital.org