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North Bay Business Journal

Monday, August 8, 2011, 7:26 am

Palm Drive hires consultants to help with affiliation talks

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    SEBASTOPOL – Palm Drive Hospital has brought on two well-known health care veterans to help the 37-bed facility chart its course through affiliation talks with larger health care organizations, a move most view as key to its financial stability.

    The Palm Drive Healthcare District Board of Directors unanimously agreed to bring on Walter Kopp, a former Sutter executive, and Richard Loos, who has advised Palm Drive on other matters, as consultants. Their goal will be to identify what the Sebastopol hospital wants or needs out of any potential affiliation with a larger organization, said board President Nancy Dobbs.

    “They’ll work quickly and give us some framework for a discussion,” Ms. Dobbs said.

    Consensus has emerged from the Palm Drive board that it will continue to struggle as a stand-alone hospital, and it has sought to align itself with a larger entity in a yet-to-be determined capacity, said board member Chris Dawson. The two consultants will help determine that capacity, Mr. Dawson said.

    Adventist Health, which operates a St. Helena Region that includes hospitals from Vallejo to Lake County, has been in affiliation talks with Palm Drive since June.

    While those talks progress, Mr. Dawson said the board needed an outside opinion.

    Ms. Dobbs said the talks with Adventist Health have been productive, but they have transpired faster than the board had anticipated. Accordingly, Palm Drive sought to enlist outside perspective on the needs of the hospital, she said.

    Mr. Kopp is a former chief operating officer of the Sutter Pacific Medial Foundation and has consulted a wide number of health care organizations, public and private, across the Bay Area.  Recently, he advised the Marin Healthcare District as it transferred operations away from Sutter Health and back to public control

    Mr. Loos, a Sebastopol resident, was senior vice president of Redwood Health Services, a Santa Rosa-based HMO, from 1983 to 1999. From 2000 to 2008, he was CEO of the Chinese Community Health Plan, a San Francisco-based HMO geared toward delivering culturally sensitive and bilingual care.

    Mr. Loos advised the hospital recently on the Palm Drive Medical Center, its outpatient facility that has been a bright spot, Mr. Dawson said.

    Terry Newmyer, CEO of Adventist Health’s Northern California Network, said the Roseville-based health group would likely have a proposal for the Palm Drive board by the end of August.

    “We’re hopeful that we can put together a plan,” he said. “There are many data points and many variables.”

    In 2007, the hospital sought bankruptcy protection after losing nearly $7 million in operating revenue. It emerged from Chapter 9 last year after selling off $10 million in bonds. The hospital entered into a three-year, $250,000 annual agreement with Tennessee-based Healthtech in 2009.

    Both Mr. Kopp and Mr. Loos declined to be interviewed for this story.

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