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North Bay Business Journal

Monday, February 20, 2012, 6:00 am

Q&A: Charles Guenther, CEO, Palm Drive Hospital

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    Charles Guenther

    SEBASTOPOL — Charles Guenther is acting CEO at Palm Drive Hospital.  He has nearly 40 years of experience in the development and management of hospitals, health care systems, health maintenance organizations and related insurance enterprises.  He has been a senior executive in large health care organizations, including Sutter Health and Dignity Health (formerly known as Catholic Healthcare West) as well as CEO of a small rural health care system.  In addition to serving as a CEO of health care enterprises, he has been a consultant, university professor and a director of many for-profit and not-for-profit corporations.

    Business Journal:  What would you say are your top priorities as the new interim CEO of Palm Drive? 

    Mr. Guenther: The first order of business is to work with the board and the medical staff to bring a much higher level of stability and teamwork to the governance and management of the hospital. We are also systematically evaluating and seeking to improve virtually everything the hospital does on a day-to-day basis. Initially, the emphasis is on those areas of our operations that most directly impact financial and clinical performance. Further on, we will be addressing facility, equipment and process issues to maximize efficiency and to improve patient comfort and convenience.

    Business Journal:  District hospitals face many unique challenges, from competing with health care giants for patients and reimbursement issues to maintaining public funding. How do you intend on addressing some of these challenges?

    Mr. Guenther:   Well, we’ll need to address all of these issues if we are to be successful in the coming years.  We’ll do that first by preserving the high quality of our current medical services and the compassion with which our staff cares for the personal needs of each and every patient. We’ll also be working with the communities we serve to better understand their expectations and to align our services with their needs and values. Finally, we will commit ourselves to following best-demonstrated practices in both governance and management, just as we do in the practice of medicine.   

    Business Journal:  What other challenges, in your experience, are unique to public hospitals? 

    Mr. Guenther: Historically, public hospitals often care for a disproportionate share of uninsured or underinsured patients, which adds significantly to the financial challenge. Also, in the interest of transparency and community participation, public hospitals are too often at a competitive disadvantage in terms of being able to make timely business decisions, adapting quickly to an ever-changing environment and in developing partnerships and joint ventures that have been important to the success of private, not-for-profit and for-profit health care organizations

    Business Journal: Palm Drive recently joined with Sonoma Valley and Marin General hospitals in a strategic alliance. In your mind, how do you see this helping the various districts and Palm Drive in particular? 

    Mr. Guenther: The immediate opportunity is in terms of cost savings derived from sharing specialized expertise, certain management functions and a robust hospital information system (HIS) and electronic medical record (EMR).  In the case of the HIS and EMR alone, Palm Drive anticipates saving roughly $2 million compared to the cost of installing the system as a freestanding hospital.  We are also seeing significant savings from our joint purchasing arrangements for supplies and pharmaceuticals. 

    And the alliance is already evaluating several longer term opportunities, including partnering with others to sponsor a small group health insurance product in Marin and Sonoma counties.      

    Business Journal: How is federal health care reform impacting public hospitals? What are the pros and cons? 

    Mr. Guenther: The ultimate impact of national health care reform is still uncertain. On the positive side, expansion of coverage for young adults to the age 26, new restrictions on insurance company practices that previously allowed the termination of coverage in the event of serious illness, annual and lifetime limits on benefits paid, and exclusions for pre-existing conditions are changes that were long overdue. (Exclusions for pre-existing conditions for adults are not prohibited until after 2014.) Yet the question of how we pay for the next wave of health care reform, and in particular the expansion of coverage to virtually all Americans, remains unanswered.  Moreover, proposals to partially pay for expanded coverage by Medicare spending cuts of up to $500 million would cripple many hospitals and drive more physicians out of the practice of medicine. In effect, we could end up with universal coverage and no place to get health care.  So, the debate will no doubt continue. 

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