Hospital’s struggle to stay open continues

In an attempt to preserve its only hospital, several Blythe citizens are trying to dissolve that institutions’s five-member governing body and transfer its responsibilities to the Riverside County Board of Supervisors.

That proposal is a response to the Chapter 9 bankruptcy filing in September by the Palo Verde Healthcare District’s board of directors, overseers of Palo Verde Hospital. The board took that action so the hospital could continue providing emergency and outpatient care to Blythe and its surrounding communities.

In the meantime, the board will try to resolve its financial issues so the only hospital in a remote part of Riverside County can remain open permanently.

“Chapter 9 is the last tool left while we work to fix the financial management challenges that have so drastically impacted the hospital during the past several years,” said Carmela Garnica, board president, in a statement. “Our community deserves a functioning hospital, (and) we are doing everything we can to keep it open.”

Palo Verde, a 52-bed acute care hospital, is the only medical facility of its kind in California within a 100-mile radius of Blythe (pop. 13,800). La Paz Hospital in Parker, Ariz. is about 50 miles from Blythe, but it does not accept most forms of insurance provided by the state of California.

Palo Verde’s emergency room remains open and is accepting patients.

The hospital’s financial problems began when its payments from Medicare and Medi–Cal were withheld because of technical issues. The hospital was also not reimbursed by the state Department of Corrections for services it provided at Ironwood State Prison, which houses 2,000 inmates and is about 20 miles from Blythe.

Vice Mayor Johnny Rodriguez, who serves on the city council’s ad hoc committee that is looking for ways to save the hospital, called the hospital’s troubles “very difficult” for Blythe and its nearby communities.

The only solution is to dissolve the board of directors and replace it with the board of supervisors, the board’s successor agency.

“Riverside County could advance Palo Verde some funds, but it probably doesn’t have much faith in this administration because of its past decision-making,” Rodriguez said.

The citizens group has gathered about half of the 1,000 signatures it needs to hold a special election. The original plan was to ask voters whether Garnica, Trina Sartin, and Rosie Rowell should be removed from the board, but Rowell announced her resignation during a special board meeting Nov. 19.

Rowell, who citied family reasons for her decision, will leave the board next month. Sandra Hudson and Dr. David Brooks remain, but both have said they will step down if their fellow board members leave.

No date for a special election has been set. None of the board members responded to a request for comment.

The current board is being targeted for removal because it allowed the circumstances that lead to bankruptcy filing to happen, putting Palo Verde and much of the High Desert community at risk, Rodriguez said.

“A new board will mean a new kind administration, starting with its new chief executive officer, whoever that ends up being,” Rodriguez said. “Otherwise, you’re looking at the hospital running out of money and shutting down, sooner or later.”

Because the computer problem took two and half months to fix, Palo Verde ended up losing about $940,000 a month in payments from Medicare, Medical, and Ironwood. To receive those payments, Palo Verde was required to submit audited cost reports to the two health care providers, but the computer issue kept that from happening.

Meanwhile, the state-mandated agency that oversees the Palo Verde Healthcare District – the Riverside Local Agency Formation Commission – is waiting to see if the board can come up with a plan that will make Palo Verde financially solvent.

If it can’t, the state-mandated agency will oversee the healthcare district dissolution and the closing of the hospital.

“I’m sure the board is doing everything it can to keep its emergency services open,” said Gary Thompson, Riverside LAFCO’s executive officer. “They’re trying to maintain what they have while the Chapter 9 process plays out in the courts. They have options, but it’s not clear what they are yet. I do know that a Chapter 9 filing can take a long time to resolve.”

In June, Blythe asked Riverside LAFCO, to review Palo Verde’s finances, one month after the hospital suspended its inpatient admissions and surgeries.

LAFCO, as it’s commonly known, was created by the state legislature in 1963 to help organize and manage the growth of cities and special districts statewide. All of California’s 58 counties have their own LAFCO, each of which establishes city and special district boundaries within its territory.

In addition to the Palo Verde Health Care District, Riverside LAFCO is in charge of the Desert Healthcare District and San Gorgonio Memorial Healthcare District.

Palo Verde got started in 1925, when the American Legion began using its clubhouse as a hospital. In 1937 it became the Blythe Branch of Riverside County Hospital, and in 1948 it was designated the Palo Verde Healthcare District.

A quick resolution to bankruptcy might be needed to keep Palo Verde open.

“Mr. Thompson said a Chapter 9 filing can take years to get resolved in court, and he’s absolutely right about that,” Rodriguez said. “The problem is the hospital doesn’t have years of funding available to it.”