Area's Private Hospitals Offer Tobacco Funds Deal
Hoping to strike a compromise, a representative of Ventura County's private hospitals offered Tuesday to share the county's $260 million tobacco settlement money if they successfully seize control of the funds in November.
The offer proposes a contract between the seven private hospitals and Ventura County Medical Center that would guarantee the public hospital a portion of the tobacco settlement funds over 25 years.
Supervisor John Flynn dismissed the idea of a contract as ridiculous, because a ballot measure backed by Community Memorial Hospital specifically excludes Ventura County Medical Center from receiving any money.
"That doesn't sound like any kind of negotiation piece to me," Flynn said.
Meanwhile, the Board of Supervisors on Tuesday delayed placing Community Memorial's initiative on the November ballot and decided instead to give chief administrator Harry Hufford 30 days to study how the money would be distributed and which hospitals would benefit the most.
Last week during closed-door negotiations, Hufford extended an informal offer to the county's private hospitals that would have granted them 7.5% of the anticipated $260 million, said James Lott, vice president of the Healthcare Assn. of Southern California.
But the percentage was "a starting point" in the talks and was "never taken seriously," Lott said.
On Tuesday, the seven private hospitals told Community Memorial Executive Director Michael Bakst they would prefer an agreement that would include some funding for Ventura County Medical Center, which serves 83% of the county's poor patients.
Lott then proposed the revenue-sharing contract as another alternative that would distribute funds using a formula in the initiative, Bakst said.
The formula calculates the amount of debt a hospital has acquired by caring for the indigent and then distributes tobacco settlement funds accordingly.
According to that formula, Community Memorial would receive between $1.2 million and $1.99 million each year. The county expects to receive $9 million to $10 million each year as its share of the state's tobacco settlement.
Lott said he doesn't expect the county to accept his latest offer, but said the proposal is worth supervisors' consideration as the county's fiscal troubles continue to mount.
According to Hufford's preliminary estimates, the county is facing a $12-million budget deficit.
"I hope reason will prevail and they would see that this initiative stands a very good chance of being passed," Lott said. "If they're interested in financial integrity of the county hospital, it would be in their best interest."
Community Memorial officials have criticized county officials for failing to formally commit any tobacco funds for health care programs and services. Supervisors have set aside $3.1 million of the tobacco money to pay a federal fine for Medicare overbilling and another $7.5 million to help cover the budget shortfall.
The success of Community Memorial's petition drive has convinced the private hospitals that the measure will most likely succeed.
"We've been struggling with how we would share the money," Lott said. "This is an attempt to say: 'Now that the initiative has qualified, let's see how we can make it work.' "
Hufford said he has agreed to meet again with the hospitals to discuss the proposal further, but he would not comment on the details of negotiations.
Community Memorial spokesman Mark Barnhill said the board's decision to analyze the initiative for 30 days was no surprise.
"We were disappointed," he said. "But we think inevitably it's going to be placed on the ballot."
Bakst of Community Memorial said the proposal is an attempt to win the county's support for the initiative. Now the decision lies with the supervisors, he said.
"The question is: Do they want to have complete and unbridled discretion" on spending the money, Bakst said. "Or would they accept the reality that the money would be used to care for the people of Ventura County?"