SEBASTOPOL -- A report from a health care consultant for Palm Drive hospital, which surfaced Friday, further details the steep financial woes facing the facility.
The report from Alvarez & Marsal, obtained by former Palm Drive Health Care Direct board candidate Jim Horn through a California Public Records Act request, said the facility is licensed for 37 beds but has been staffed for only 12 beds to help offset staffing costs.
Palm Drive "has a critically low cash balance," according to the report, prepared just last month. After payroll funding on March 13, the hospital had a cash balance of just $17,000, the report said. After March 21, collections were forecast to be $498,000, while payroll taxes, benefits and physician payments of $438,000 were due to be paid, according to the report. Only $35,000 was budgeted to pay vendors.
"It is unlikely that (the hospital) will be able to sustain service with critical vendors over the next six weeks," the report said.
The board for the Palm Drive Healthcare District said closure of the acute-care and emergency operations could occur as soon as April 28. At its meeting this coming Monday, the board is expected to take up the resolution regarding shuttering services, which comes less than a week after voting unanimously to declare fiscal emergency and begin Chapter 9 Bankruptcy Protection proceedings.
The hospital has been staring at operating losses of $4 million to $5 million a year, and the institution owes vendors about $6 million, according to David Cox, interim chief financial officer and also CFO for Marin General Hospital. In January alone, the hospital reported a loss of $356,200, while through the fiscal year, ending July 1, it has lost more than $1.2 million.
Inpatient volume has seen a sharp decline, dropping from roughly 12 patients per day to as low as seven a day. That may seem like a small change in patient headcounts, but it represents a more than 30 percent decline in volume, hospital CEO Tom Harlan said at last week's meeting.
In an attempt to save cash, Palm Drive canceled its support agreement with the Prima Medical Group to operate its outpatient clinic, resulting in a savings of $23,000 per month, according to the consultant's report.
Assemblyman Levine, D-San Rafael, had been crafting legislation that would enable that would enable Palm Drive to refinance its bond debt. Assemblyman Levine's office has not yet responded to inquiries on the ongoing developments related to Palm Drive.
The nurses union said its press conference is tomorrow, April 5, at 11:30 a.m. at the Sebastopol Senior Center, 167 N. High St.
The health care district is meeting on Monday at 5:30 p.m. to vote on the resolution of ending services at the Community Church of Sebastopol, at 1000 Gravenstein Highway North.
