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North Bay Business Journal

Monday, February 20, 2012, 8:08 am

Sonoma Valley Hospital seeking parcel tax renewal

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    SONOMA — Sonoma Valley Hospital is seeking a five-year extension of a parcel tax that provides more than $2 million in annual revenue for the district hospital, which officials say is vital to maintaining core and emergency services in eastern Sonoma County.

    The Sonoma Valley Health Care District, which oversees operations at the 83-bed hospital, is conducting a month-long, mail-in ballot to extend Measure A. The $195-per parcel tax generates about $2.85 million per year, according to Sonoma Valley Chief Financial Officer Rick Reid, who also is CFO of Palm Drive Hospital and vice president of finance and controller for Marin General Hospital.

    “It’s really critical,” Mr. Reid said. “It allows us to maintain our current operations, and it allows for a community of this size to have its own hospital.”

    Ballots were mailed on Feb. 6 and a final tally will be taken on March 6, according to Peter Hohorst, chair of the health care district board. The measure needs a two-thirds majority to pass.

    Revenue from the parcel tax is about 5.4 percent of the hospital’s  approximately $45 million in annual revenues, Mr. Reid said, who added that emergency services in particular are helped by the revenue. Without it, such services could potentially be scaled back or eliminated, which would be problematic given Sonoma Valley’s relative remoteness from major medical facilities.

    “If you’re in an emergency, that’s a long way to go” to Santa Rosa, he said.

    Mr. Hohorst went a step further, explaining that the small district hospital is at a financial disadvantage in several respects. For one, it is substantially under-reimbursed in both Medicare and Medi-Cal. The hospital provides about $22 million in annual Medicare services and receives about $20 million in reimbursement from the Centers for Medicare and Medicaid. For Medi-Cal, the state’s version of Medicare, the hospital receives about 72 percent reimbursement on what it provides in care.

    Funds from Measure A help make up that shortfall, which is acutely felt in an area with a high percentage of Medicare-aged retirees, Mr. Hohorst said.

    “In a normal year, you could say our hospital is under-reimbursed. You basically have to find ways to supplement that,” he said.

    And while the revenue is only 5.4 percent of the overall budget, it represents about 11 percent of wages and salary for hospital staff, Mr. Hohorst said. A 10 or 11 percent reduction in staff would severely hinder operations if the money from Measure A isn’t available, he added.

    No formal opposition to the tax has emerged, Mr. Hohorst said, but the district is nonetheless actively promoting the measure to explain its impact.

    “The institution of the hospital is very important to the community, and the parcel tax is very, very important to provide quality health care. …  It’s a good use of money for the community.”

     

     

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