POC Supports Doctors’ Demands to Retain Local Control of Sutter Coast Hospital

July 31, 2013
Sutter Coast Hospital Chief of Staff, Greg Duncan, M.D. (left) with former Chief of Staff, Kevin Caldwell, M.D. who also sits on the Del Norte Health Care District Board addressing a town hall meeting in Crescent City about the precarious future of their rural hospital.

Sutter Coast Hospital Chief of Staff, Greg Duncan, M.D. (left) with former Chief of Staff, Kevin Caldwell, M.D. who also sits on the Del Norte Health Care District Board addressing a town hall meeting in Crescent City about the precarious future of their rural hospital.

Physicians at Sutter Coast Hospital (SCH) in Crescent City, led by Physicians Organizing Committee (POC) members Drs. Greg Duncan, Kevin Caldwell, Mark Davis and Anne Marie Duncan, together with a community united to preserve vital hospital resources for their isolated nor-thern California and southern Oregon region, scored a victory on 6 March when, due to overwhelming community opposition, the SCH Board of Directors voted to put their “regionalization” plan on indefinite hold.
Sutter Health’s regionalization stra-tegy is a system-wide plan to transfer ownership and complete control of 25 locally-owned hospitals managed by Sut-ter to Sutter Health. These hospitals are currently in a “partnership” relationship with Sutter, which has been contracted to operate them by the local Healthcare Districts which built the hospitals, but they still have local Boards. Regionalization eliminates local hospital ownership, dis-solves local hospital Boards and transfers control of the hospitals, including patient care policies, to Sutter Health’s Regional Boards.  In Crescent City, regionalization would give the Sutter West Bay Board, which meets 350 miles away in San Francisco, the authority to implement a current proposal from Sutter Health, approved by the local Board, to downsize SCH from 49 down to 25 beds in order to qualify for the federal “Critical Access” program. They downsized to 49 beds from 59 beds in the last year, in order to qualify for Federal funding via the Sole Community Provider program, which only applies to facilities with less than 50 beds.

No Regionalization

Sutter Health has implemented Critical Access and taken ownership at Sutter Lakeside Hospital in Lakeport, CA. “Critical Access legislation was passed in order to increase access to care by subsidizing rural hospitals with 25 or fewer beds,” explained SCH Chief of Staff Dr. Greg Duncan. “At Sutter Lakeside, hospital capacity was cut more than 60%, from 69 to 25 beds, to qualify for Critical Access funding, resulting in reduced access for patients, increased payments to Sutter and increased cost to the Medicare program.”
At Sutter Coast, physicians of the Medical Executive Committee and the medical staff have passed numerous unanimous resolutions opposing region-alization and Critical Access, but the SCH Board, having deliberately excluded everyone in the community from the regionalization decision-making process, had repeatedly refused to rescind their vote to regionalize. (All SCH Board members except the hospital’s Chief of Staff are appointed by Sutter Health).
“Sutter discourages diversity of opinion on the hospital Board,” Duncan said, adding, “when the Board Chair stated last November that anyone who had taken a public position against regionalization or Critical Access would be ineligible for Board membership, he eliminated over 2,500 local citizens who have signed a petition opposing the takeover of their hospital and plans to cut the number of beds in half.”

Fliers and petitions reflect the senti­ments of people attending a 16 March meet­ing in Crescent City fea­­turing Dr. Duncan speaking to the catastrophic implications of regionalization.

Fliers and petitions reflect the senti­ments of people attending a 16 March meet­ing in Crescent City fea­­turing Dr. Duncan speaking to the catastrophic implications of regionalization.

Residents of Crescent City, California line the streets to demonstrate their opposition to the attempt by Sutter Health to put their local hospital, the only hospital in a more than 80-mile radius, under the jurisdiction of Sutter’s West Bay Region so they can cut the number of beds in half in order to glean more Medicare money despite the impact this would have on the local community.

Residents of Crescent City, California line the streets to demonstrate their opposition to the attempt by Sutter Health to put their local hospital, the only hospital in a more than 80-mile radius, under the jurisdiction of Sutter’s West Bay Region so they can cut the number of beds in half in order to glean more Medicare money despite the impact this would have on the local community.

Squelching opposing viewpoints

According to Duncan, who is on the SCH Board in his capacity as Chief of Staff, “Due to my opposition to Regionalization and Critical Access, a Sutter Health attorney (who is not a Board member) dismissed me from the Board room twice last year, for the stated purpose of discussing legal strategies in my absence. I found out later that the Board took action on press releases and letters to elected officials, which had nothing to do with any litigation.” Duncan added that several attorneys have told him these actions of the Board violate corporate law.

Members helping members

Since joining POC in June 2012, Duncan has maintained regular contact seeking advice and additional sources of support and publicity. POC arranged conference calls with physicians in the Bay Area involved in similar struggles, including POC members at San Leandro Hospital (SLH), where physicians are fighting to prevent Sutter Health from taking control of the hospital. Dr. Miles Adler, Chief of Staff at SLH, stressed the importance of a unified medical staff. Vin Sawhney, M.D. relayed his experiences as both a San Leandro Hospital physician and a Board member of the Eden Township Healthcare District, which is battling to preserve the hospital’s vital role in providing health care for the San Leandro Community. 
POC also connected Dr. Duncan with POC member Carole Rogers, R.N., Chair of the Eden Township Healthcare District, who shared her experience with Sutter Health, and assisted the Crescent City physicians with setting up a web site (http://www.crescentcityhospital.blogspot.com), which serves to educate and unite the community.
Thomas Powers, M.D. founder of the now-shuttered inpatient psychiatric unit at Sutter’s Eden Hospital, noted how Sutter, supposedly a non-profit entity, had at first pledged to keep San Leandro Hospital open for 20 years, but then inserted language through the Healthcare District Board (at the time dominated by members with ties to Sutter) which gave them the option to close it in two years if it was not profitable.
In Del Norte County, where SCH is located, the Healthcare District won a Preliminary Injunction in Superior Court last fall, which prevents Sutter Health from regionalizing SCH or implementing Critical Access designation. “While Sut-ter’s postponement of their regional-ization effort is favorable news,” said Duncan, “actions speak louder than words, and despite their pronouncements, Sutter Health and the local hospital Board upped the ante by filing a motion in the Court of Appeal to remove the Injunction, even though arbitration hearings were already scheduled.”
Dr. Kevin Caldwell, former Chief of Medical Staff and current Healthcare District Board member, confirmed that Sutter’s expansion of the litigation into the Court of Appeal diverts scarce resources away from patient care.  Caldwell noted, “Sutter Health contacted the District immediately after the Injunction was granted, asking for our annual budget. They know we don’t have the money to oppose them indefinitely.”
In October of 2012 POC President Geoffrey Wilson; Vice President Michael Treece, M.D.; Membership Coordinator Brian Tseng and member Christina Padilla, R.N., met with Duncan in San Francisco to explain POC’s fights to keep St. Luke’s and San Leandro Hospitals in the Bay Area open. They discussed assistance and training POC can provide in organizing community support for the fight to retain ownership and services at local hospitals, and how to delegate responsibility to expand participation among other sectors of the community.  Tseng explained, “quality and affordable healthcare are of universal concern — everyone has an interest, regardless of their political or economic standing. Churches, seniors, schools, law enforcement and first responders all share a need for their local hospital.” In Crescent City, all of these groups have joined the fight to preserve their say in the priorities of the only hospital for 89 miles. 
“The Crescent City physicians took our suggestions and did them one better,” noted Wilson. When Duncan returned to Crescent City he sought expanded support from community leaders. The Del Norte County Board of Supervisors, City Council of Crescent City and the Del Norte Healthcare District all voted unanimously to ask the SCH Board to rescind their vote to transfer hospital ownership to Sutter Health. When Sutter Health and the hospital Board refused to revisit their decision, the City Council, County Supervisors, and Healthcare Dis­trict Board each passed unanimous reso­lutions asking California Attorney General Kamala Harris to investigate Sutter Health’s activities in Del Norte County.  
“POC has begun including Crescent City members on the conference calls we’ve organized in response to benefit requests from physicians at other hospitals. They have been able to share their experiences with other members asking for advice, such as the case with a group of surgeons summarily removed from the ER of another hospital’s call schedule for disagreeing with hospital policies to transfer surgical patients long distances, which in one case ended up costing a patient her life,” reports Wilson.  
Duncan was contacted by members of SCH’s volunteer auxiliary, who were concerned that Sutter had dissolved the auxiliary Board and taken control of the funds raised through their work in the gift shop. They noted that if regionalization went through, their volunteer efforts would be supporting Sutter’s regional agenda vs. their own local community’s needs. Sutter tried to prevent them from meeting with Duncan, stating that the telephone numbers of the volunteers were “proprietary” and could not be used to organize meetings. The volunteers converged on Duncan’s office anyway.  On the way out, one of the volunteers told Dr. Duncan that they would need to perform CT scans on any doctor who wasn’t willing to stand up for the community “to see if they have a spine!”
On 4 March, Sutter Coast Hos­pital physicians notified the Board of Directors of SCH that the Board’s purposeful exclusion of interested parties from their decision to transfer hospital ownership to Sutter Health, despite the objections of then-Chief of Staff Kevin Caldwell, M.D., violated Medicare regulations and Joint Commission on Hospital Accreditation standards.

(Left to right) Karen Sanders, Mark Davis, M.D. and Greg Duncan, M.D. at a June 6, 2012 community rally in Crescent City to prevent the hospital from being taken over and downsized.

(Left to right) Karen Sanders, Mark Davis, M.D. and Greg Duncan, M.D. at a June 6, 2012 community rally in Crescent City to prevent the hospital from being taken over and downsized.

Illegalities challenged

They also noted, based on a 28 February letter from John D. Harwell, Esq., an expert in healthcare law, that Sutter Health’s current regional bylaws violate California law, which protects patients from corporate employees with no medical training having authority over patient care policies. Harwell, whom Sutter and the SCH physicians mutually agreed to bring in to review the regional bylaws, also noted that Sutter’s violations of California law expose physicians to possible sanction by the Medical Board of California.

Standing room only crowds of Del Norte County residents turn out to hear hospital chief of staff, Greg Duncan, M.D. and others speak about the impact of projected plans to downsize their hospital from 49 to 25 beds.

Standing room only crowds of Del Norte County residents turn out to hear hospital chief of staff, Greg Duncan, M.D. and others speak about the impact of projected plans to downsize their hospital from 49 to 25 beds.

Critical of “Critical Access”

Following Sutter Health’s call for a special hospital Board meeting where executives from Sutter Lakeside were called in to “sell” the Critical Access program, local physicians were alarmed to realize Sutter’s intent to go forward with installing Critical Access policies at SCH. A subsequent CEO report stated that Critical Access may need a higher priority than regionalization. Dr. Duncan, and Vice Chief of Staff Mark Davis, M.D., each made requests to view the Critical Access data which Sutter Health was using to formulate their recommendation. Sutter refused to release the data.  Sutter West Bay President Mike Cohill still refuses to release the data from two prior Critical Access studies for Sutter Coast Hospital. 
POC encouraged Duncan to do his own study on Critical Access.  The results were more alarming than the doctors had imagined.  In a 7 March 2013 letter to the SCH Board of Directors Duncan notes, “Based on census data from Sutter Coast Hospital, had we been a Critical Access hospital, we would have been closed to all patient admissions over 50% of the days, and closed to all but maternity and pediatric patients on over 70% of the days during the four month period ending 2/1/13.” 
In Del Norte County, hospital closure would mean patients must be transferred by fixed wing aircraft. The cost, borne by the patient, usually exceeds $40,000, and the trip takes hours. Family members are generally not permitted in the aircraft. In a poor community where many families lack reliable transportation, visiting their loved ones in distant hospitals is often impossible. Getting home is the patient’s responsibility.

Legal challenges

Concerned about the practices of Sutter Health attorneys Lawrence Dempsey, Esq. and Michael Duncheon, Esq., Caldwell and Duncan filed a complaint with the State Bar Association, citing the following concerns:
 (1) Lack of disclosure of potential conflict of interest, and failure to obtain written informed consent, while purporting to simultaneously represent two separate corporations during a transfer of corporate ownership, and an extensive revision of SCH bylaws.
(2) Knowingly providing false information and failing to correct inaccurate information by Sutter executives during SCH Board meetings.
(3) Altering draft meeting minutes.   (Mr. Duncheon deleted 70% of the content of draft minutes, from a Medical Staff/Board meeting he did not even attend).
(4) Infringement on Medical Staff autonomy and self-governance through the introduction of bylaws (without the knowledge or consent of the Medical Staff) which violate California law.
(5) Dismissal of an SCH Board member from the Board room under false pretenses. 
Duncan characterized the Bar Association’s response as “merely interviewing Duncheon and Dempsey, putting their responses on State Bar letterhead, without any independent investigation of the complaint, and closing the case. Eight of our specific concerns went unanswered.”  Caldwell and Duncan are requesting an in-depth review of their concerns by the State Bar’s Audit and Review Unit.

Sutter executives may have breached criminal code

At a Town Hall meeting in Crescent City on 13 March, after Duncan outlined several false statements made by six Sutter officials, including SCH CEO Eugene Suksi, and decried Sutter’s attempt to seize control of their hospital through what he described as “possible fraud, coercion and undue influence,” Del Norte County District Attorney Jon Alexander said he would investigate Sutter. On 25 March, Sutter Health Regional President Mike Cohill announced Suksi’s resignation.
POC has coordinated its efforts to preserve access to care and uphold California law in Crescent City, California with our ongoing work to preserve St. Luke’s and San Leandro Hospitals in the San Francisco Bay Area.  But there are so many other hospitals where physicians, nurses and everyone involved in providing patient care need to organize.  As John Harwell, Esq., explained, “the reach of corporate influence into the arena of patient care is a nationwide contagion.” Duncan volunteered his opinion on how to restore the balance:  “POC is a great resource for physicians of all practice types to work together on the one mission we all support — affordable, accessible, and quality care for our patients.”

This entry was posted in Medical Staff Self-Governance: Crescent City. Bookmark the permalink.