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HomeMy WebLinkAbout~Master - Special Meeting of the Ames City Council 05/16/1994MINUTES OF THE SPECIAL MEETING OF THE AMES CITY COUNCIL AMES, IOWA MAY 16, 1994 The Ames City Council met in special session at 7:00 p.m., May 16, l994, in the City Council Chambers in the City Hall, 5l5 Clark Avenue, pursuant to law with Mayor Pro Tem Parks, presiding and the following Council Members present: Campbell, Brown, Wirth, Tedesco, and Hoffman. SECOND MEETING ON THE FUTURE OF THE OWNERSHIP OF MARY GREELEY MEDICAL CENTER: Mayor Pro Tem Parks introduced Robert J. Baudino, Jr., attorney with the Baudino Law Firm, P.C., Albert A. Thweatt, AIA, Greshma, Smith Partners, and Douglas B. Lewis, Vice President, OrNda HealthCorp. Mayor Pro Tem announced that OrNda will conduct a citizen's forum on Tuesday, May l7, beginning at 5:30 p.m. in the Council Chambers. PRESENTATION: Mr. Baudino began the presentation by stating his involvement with purchases of hospitals in Iowa. Since 1983 there have been 7 hospital changes of ownership or transactions in Iowa. Two of those were non-profit to for-profit transactions. Mr. Baudino handled 4 of the 7 transactions in both of the non-profit to for-profit purchases. OrNda has a track record of providing quality health care and a lengthy list of experience. OrNda has a 10 year history of Iowa operation - employing Iowans and providing good quality health care. Mr. Thweat presented a visual concept of what would happen to MGMC and McFarland Clinic. A drawing layout was shown as to necessary services and how the building would be designed to meet the concept of integrated care. Council Member Wirth left the meeting at 7:58 p.m Mr. Lewis explained the changes health care is going through and hospitals need protection from both the ups and downs of those changes. A patient needs managed from the beginning to the end of his/her lifetime. Now is the time to get ahead of high costs, high care, etc. OrNda would like to accomplish this with new and creative ways of health care. Mayor Pro Tem Parks asked the Council to present their questions. Council Member Hoffman: What was appealing about MGMC? Answer: Mr. Baudino answered that McFarland Clinic and the hospital are already adjacent to each other, the facility is good-sized and in good shape. The elements are here for OrNda to be a third system in Iowa and to form a hub around Ames. Mr. Baudino explained that without a hub patients will begin to flow to Des Moines. Answer: Mr. Lewis stated the appeal of MGMC was that the relationships were already in place as far as McFarland Clinic and MGMC and those relationships could be developed. Council Member Hoffman: Do you see McFarland Clinic and MGMC as a completely integrated system? Answer: Mr.Baudino stated that if McFarland Clinic and MGMC were interested in integrating they would be the first ones over to their office. Mr. Lewis noted they had three meetings with McFarland and stated that McFarland Clinic has chosen to remain neutral on this issue and OrNda appreciates their position. Council Member Hoffman: Would you speak about the Board that you would develop to manage the hospital? Answer: Mr. Baudino stated that OrNda HealthCorp would incorporate an Iowa Corporation under Chapter 490. The Board of Directors would be composed of 50% citizens from this area, 50% of area physicians, and the Administrator of MGMC. The Administrator of MGMC would be an employee of OrNda. OrNda would have the controlling position in areas of major decision-making. Council Member Hoffman: How would the Board Members be selected? Answer: Mr Lewis stated that the medical staff would be asked for nominations from the medical staff. OrNda would take nominations from present Board Members, the City, the County, the Chamber of Commerce, etc. There would be a Board of 7-9 members. Every year one-third of the board would be rotated, a Board Member could not serve for longer than three years, and after serving his/her term it would be a number of years before they could be re-nominated. Council Member Tedesco: What four of seven changes mentioned earlier in the presentation were city-owned hospitals and were they all converted to a facility that ended up being owned by a large multiple hospital operator? Mr.Baudino stated that he has not done any city to non- profit or city to for-profit transactions in Iowa, but has done them in other states. Council Member Tedesco: What about the balance of the medical community in Ames, both physicians and other services, in relationship to integration? Answer: Mr. Lewis stated that, with the system they have in mind, they would allow individuals to move in or out of the integrated health system. They can still practice medicine in the community without owning any part of the system. Council Member Tedesco: Would you discard the current plan for remodeling, expansion, etc.? Answer: Mr. Thweatt stated that was correct. Council Member Tedesco: Is there are reason you didn't like the current plan? Answer: Mr. Thweatt responded that it goes back to bringing McFarland Clinic and MGMC together. Council Member Tedesco: Would you do anything with the parking ramp? Answer: Mr. Thweatt stated they had not addressed the parking situation. Council Member Tedesco: In combining of the facilities you stated there was a possibility of reducing staff? Answer: Mr. Thweatt stated they were only a designer and not an operator, but felt when you bring departments together you have to look at staff allocation. Mr. Lewis responded that if the integrated seamless system works properly there will be more employed people under the system that currently exists now. Council Member Tedesco: How does your current plan compare with what is at MGMC regarding employee and benefit plans? Answer: Mr. Lewis stated that the conversion to the OrNda plan is usually more of a benefit to the employees than what they currently have. Council Member Tedesco: What about capital improvement planning? Does that occur at the local level? Answer: Mr. Lewis explained that the capital budget process starts at the hospital level to develop the capital requirement list. Council Member Tedesco: Is the Administrator an employee of OrNda? Answer: Mr. Lewis stated everyone will be an employee of OrNda. Council Member Tedesco: Will there be employees of the MGMC corporation? Answer: Mr. Lewis stated no, it will be all OrNda employees. Council Member Tedesco: Is the Director of Nursing a special employee that you hire along side the Administrator or is that at the beckoning of the Administrator? Answer: Mr. Lewis replied that all of the employees at MGMC will be OrNda employed. The Administrator selects his staff. The Chief Financial Officer and the Director of Nurses are usually people that are in the system or who have applied to OrNda. Council Member Tedesco: Is there a possibility of those three being outside of the current structure or outside of the community? Answer: Mr. Lewis - yes that possibility exists. Council Member Brown: Passes. Council Member Campbell: Passes. Mayor Pro Tem Parks: You implied earlier that selling MGMC was a myth? Mr. Baudino replied - Can anyone sell the hospital once it is released from the city's ownership? - yes. Is it a myth that the probability is greater that we are going to sell it than a 501(c)3 - I would tell you it is the reverse of that. Mayor Pro Tem Parks: We are requiring our existing hospital to construct parking facilities, what would that do to your existing offer? Answer: Mr. Baudino stated that it wouldn't do anything to their offer. The offer is to pay $97,682,934 for the assets of MGMC. If the parking ramp is a requirement then OrNda will have to deal with that in addition to the $97M. Mayor Pro Tem Parks: What is the $56.8M that we would be responsible for? Answer: Mr. Baudino stated that the City would technically be responsible for paying liabilities. Mayor Pro Tem Parks: What did you base your evaluation on? Answer: Mr. Lewis stated a multiple could be used or add up the assets and subtract the liabilities and meet the bonded indebtedness. Mayor Pro Tem Parks: What bond rating does OrNda currently carry? Answer: Mr. Lewis stated that they just went through another merger and is not certain at this particular time. Mayor Pro Tem Parks: Prior to the merger, what was the bond rating? Answer: Mr. Lewis stated he had no idea at this time. Mayor Pro Tem Parks announced there will be a public forum Tuesday, at 5:30 in the Council Chambers. He will entertain questions for about 10 minutes from the public. No one wishing to come forward the meeting was closed. ADJOURNMENT: Meeting was adjourned at 8:50 p.m. Jill Ripperger, Acting City Clerk Mayor Pro Tem John Parks Ginger Jones, Recording Secretary