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North Bay Business Journal

Tuesday, November 8, 2011, 10:45 am

Palm Drive leans toward Marin General affiliation

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    Palm Drive Hospital

    SEBASTOPOL — The Palm Drive Healthcare District last night chose to advance affiliation talks with Marin General Hospital over four other proposals, a move that came earlier than expected.

    The district, which oversees operations at Palm Drive Hospital, could reach a final agreement within 30 days. The board voted 4-0, with one absent, to select Marin General’s proposal. However, the board also kept open the possibility of one possible backup. Catholic Healthcare West was among the five suitors and will be put on standby, in the event that talks with Marin General break down.

    The board at the 37-bed hospital had been seeking affiliation proposals for the past several months, as consensus emerged that Palm Drive would struggle to survive as a stand-alone district hospital. In early 2010, the hospital emerged from Chapter 9 bankruptcy protection after selling off $10 million in bonds.

    Palm Drive’s medical staff heard the final affiliate presentations on Monday afternoon and sent Dr. Richard Powers,  chief of staff, to the board saying they wanted Marin General. The board concurred.

    Other suitors included Adventist Health, St. Joseph Health System and Health Tech, the current operator of the hospital, which has said it would support the health care district in whatever decision it made.

    Adventist Health had pulled out of talks with Palm Drive.

    The Marin Healthcare proposal allows Palm Drive to select its own CEO and CFO. Whether the current HealthTech executives, CEO Richard Polheber and CFO David Glassburn, stay on board remains to be seen. HealthTech’s contract ends in November 2012, which could continue pending negotiations.

    Marin General, which is overseen by the Marin Healthcare District, reached a similar affiliation with Sonoma Valley Hospital last year, with the two district hospitals citing positive economic benefit and economies of scale from the agreement.

    The board opted for Marin General because it already has a footprint in the county, and the Marin-Sonoma IPA and the Prima Medical Group, which are affiliated with Marin General and a number of other hospitals, also have a strong presence in Sonoma County and are seeking to expand further.

    Next, Marin General will be asked to make a presentation to the public and the ad hoc committee will begin negotiations.

     

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