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HomeMy WebLinkAbout~Master - Special Meeting of the Ames City Council 06/02/1994MINUTES OF THE SPECIAL MEETING OF THE AMES CITY COUNCIL AMES, IOWA JUNE 2, 1994 The Ames City Council met in special session at 7:05 p.m. He announced this was a special meeting for the purpose of receiving comments from the public and those comments will be put in the public record, concerning the potential disposal and future of Mary Greeley Medical Center. He announced that comments would be accepted from the public present as well as by telephone. He informed the public viewpoints regarding this important decision. There will be 3 sessions, if needed, with a limit of five minutes per person speaking time. The Mayor announced that he was pleased there were so many present. PUBLIC SPEAKERS: Ginny Koch, 1207 Marston: Registered nurse employed in the Department of Education at MGMC. She is representing 4,604 residents of central Iowa who have signed the following petition. "Believing in the continuance of high quality health care, low cost health services provided at MGMC, we support the creation of a not-for-profit, non-municipal and locally-owned hospital. This option is presented and supported by the MG Board of Trustees." She stated that 867 signatures have already been given to Sharon Wirth, and remaining signatures being presented this evening. Signatures of 1,896 are from residents of Ames, and 1,811 are signatures from residents of 106 other central Iowa communities. Mike Ness, 340 Lafayette, Story City: Position at the hospital is Director of Materials Management. His comments are related to prices. He is responsible for procurement of goods and services at MG. The presentations have referenced reducing prices through more effective purchasing practices. MGMC belongs to American Health Care Systems which is a group purchasing organization. American Health Care Systems is the largest committed purchasing group in the United States. OrNda and Quorum pay higher prices than MGMC for like products. The blanket approach used by Quorum and OrNda will not yield the results that they have seen elsewhere. Ruth Moyer, 1520 Stone Brooke Road: Her husband and herself are unalterably opposed to the sale of MGMC to a private for-profit group. One of the services she is familiar with is Homeward. She feels when for-profits look for a place to make cuts, she fears that Homeward and like services will be lost. R. K. Richards, 1821 George Allen Avenue: The changing of hospital management is the dumbest thing he has ever seen. There have been no valid reasons for making this change. Two sort of reasons were given in a flyer, one of which was they wanted to operate in secrecy. The hospital has been operating in the open for at least 25 years. There have been no problems that he knows of. The other reason has to do with changing National Health Care, but nothing has changed yet and until it does, we don't know what those changes will be. Unless there are some sensible reasons for doing something different, then he suggests no changes be made. Donald Powers, Member of the Medical Staff, 3538 Eisenhower: Stated he attended the meeting on the for-profit, city-owned operation. One of the council members mentioned that pros and cons were very distinctly given on this option, but not on the so-called for-profit options. He refers to "so-called" because there is profit in either option the only difference is in spending and both go for the top dollar. He feels there should be another option - do nothing. He stated there is dominance by a few people in the hospital and more dominance is desired and feels this is the real reason behind a need for change. He wants the City Council to oversee the fiscal and ethical responsibilities of the hospital. Mayor Clinic offered to provide integration and he was amazed this was not pursued. Eino Kainlauri, 3604 Ross Road: Why is this change even being proposed and why are some private profit organizations interested? The citizens and elected Council own it. Any organization that wants to buy it and spend $40M wants to recover that money and some more. The citizens will pay for it. "If it isn't broke, don't fix it." Is in favor of maintaining the present system. Don Heuss, 2137 Prairie View East: Is the Vice-President of the Ames Chamber of Commerce, (statement given to clerk and Council). The ACC has reviewedthe issue facing MGMC. After analysis of the various options, we feel the best way to accomplish the principles given in our written statement is through a community-based not-for-profit governance structure. Jane Halliburton, 1128 Roosevelt: Speaking on behalf of the Story County Board of Health. The Board of Health has not adopted a position or recommendation regarding the alternatives being examined for MGMC, but are addressing two specific concerns - Homeward and the Ambulance Service. Funding for the fiscal year just ending was $244,770. This funding is specifically for the maintenance and expansion of public health nursing services with emphasis on service for the elderly and low income. The rules for distribution of funds are found in the Iowa Administrative Code, "for the purposes of these rules, unless otherwise defined, agency means a government or nonprofit organization designated by the local board to sub-contract for the State Public Health Nursing Appropriation Funds." The same definition applies to the Home Care Aid Service, and the ambulance service which provides the Ames Mid-Iowa Critical Incident Response Team. The Story County Board of Health asks for contractual assurances of their continuation in any change that may be anticipated. David Metzler, 1205 Michigan Avenue: Does not understand why there needs to be a change. Why is there a rush to change with the uncertainty of upcoming health changes in the next few years? Feels that someone is trying to make a profit and doesn't know who it is. He feels that the doctors and hospital board need to take the citizens of Ames into their confidence and dedication to cooperation is needed. Larry Otteman, 1133 Oklahoma: Acting Chief of Medical Staff at MGMC. In favor of converting to a foundation to accept the assets and liability of the hospital. However, the option of a local for- profit model gave him food for thought. He feels that local control is a key element. He suggested individuals he felt would make strong members of a new board. He also expressed that building expansion is extremely critical. Changes that he does not want to occur are the diversity of specialties and low cost care. Merlin Pfannkuch, 1424 Kellogg Avenue: Would like to urge the Council to take time to allow adequate public discussion on the issues. Last fall, he supported privatization of the hospital as necessary, now he is not so sure. A weakness he has seen in the discussions over the last 18 months has focused on the needs of the health care providers, not the needs of those who need medical care. He prefers to do nothing or adopt the local for-profit option. Sam Pritchard, 912 Kellogg Avenue: Thanked the Council for time spent exploring the options. Would like to see one more meeting where the Council and the Mayor would debate the pros and cons of each proposal. His concerns are: fair market value, when will fair market value be established, will the fair market value be applied equally to each of the options, integration of services, primary care physicians, McFarland's financial ability, the 1990-94 Strategic Plan, duplication of services, legal documents, developer's agreement for expansion and the developer's agreement with McFarland Clinic, lack of discussion with the consumer, and local ownership. Johnie Hammond, 3134 Ross Road: What is the problem we are trying to fix? She has asked Council Members, City Attorney, Members of the Hospital Board and physicians. The only problem that she has found is the open meetings law. She suggests going to the legislature and get a special exception to the open meetings law. Kevin Rippey, 1216 28th Street: He feels we need to prepare for change and the medical community is trying to take a pro-active stance and prepare for the managed care environment. He feels that the Council needs to take into account that if sold to a for-profit we would lose control of our health care dollars. There have been many professionals from various occupations and businesses that have stated the best option is the not-for-profit option and he is in agreement. Agatha Huepenbecker, President of MGMC Foundation: Community commitment is generated when a hospital is a not-for-profit organization. The members of the MG Foundation Board encourage the City Council to support the private not-for-profit hospital ownership option. Steve McKinney, 230 Raphael Avenue: In February he came to MGMC from southern Minnesota. The hospital where he was employed was owned by a hospital corporation. He stated that within a few weeks after purchase they were told to cut expenses 5% across the board and a few weeks later were told to increase charges by 11% that their larger hospitals were in trouble. Within two months they were told to cut expenses further - this included layoffs, firing, and not replacing critical staff members. In the last year health insurance premiums increased 63%, morale was at an all time low, and program development stopped completely. He felt the problems were present because of no local control. He feels that if the hospital is sold to a for-profit absentee corporation these problems will happen in Ames. Harry Brearley, 1537 Linden Drive: Stated that he favors continued City ownership of the hospital. He is concerned about the board membership and the replacement of board members. He feels that any replacement of board members should be elected by the City or by appointment of the Council. Chuck Jons, 2915 Forest Hills: He is speaking as a member of the task force for the Chamber of Commerce. He read two letters. A letter from Norman Rinderknecht states, "I strongly agree that non-municipal not-for-profit ownership is the only decision that can be made." A letter from Erb Hunziker stated the hospital should be changed to some form of privatization as quickly as possible so that quality care may be maintained. These letters helped the Chamber of Commerce Task Force make their decision. Don Schulze, 601 20th Street: Stated he is a 45 year resident of Ames. He hoped there would be no changes in any option that might be made in the ambulance service, Homeward, and the blood bank. Donna Doran, President of MGMC Auxiliary: The Auxiliary statement is to support the nonprofit privatization of the hospital. Many of the programs that the auxiliary sponsors are services to the patient and the community. there are no fees charged so they do not generate income. Therefore, it is their belief that many, if not all, services would be in jeopardy under a for-profit organization. Jerry Shakeshaft, 330 North Franklin: Was Chief of State Plans in the U.S. Public Health Program, Washington, DC. He was in that position when the first major push for cost-cutting in hospitals was generated. He personally agrees that "stay the way you are" is worth considering. He also feels there is merit in the City creating a for-profit corporation. He stressed do not allow the medical staff to dominate the governing body, but retain main citizen control over the corporate body if at all possible. Mike Kitchell, 3122 Kingman Road: Physician at MGMC and member of McFarland Clinic. Wanted to address some of the distrust regarding a community-owned local not-for-profit organization. there are 23 hospitals about the same size as MGMC in the State of Iowa. Twenty of those hospitals are 501(c)3 organizations. They are community-run hospitals. The reason physicians feel they should change the governance of the hospital is that change is eminent. In the future, the government or insurance companies will tell the patient where they can go. The physicians feel making MGMC a community-run not-for-profit 501(c)3 plan is the best way to continue a strong organization for survival. Deborah Timms, 3721 Pleasant View Road: She is an RN in the MGMC Outpatient Surgery Unit. If a for-profit organization comes in, the nursing staff will experience cuts. Let's not make the same mistake that Mr. McKinney's hospital made. Emil Peterson, 2730 Valley View Road: Stated that he had a bias and an interest in this situation. His bias is that he favors local control. He has an indirect financial interest because his employer is Iowa Benefits and they provide medical care administration to MGMC and provide local expertise. He is in favor of a nonprofit organization. Mark Snell, 1128 Indiana Avenue: Is a new resident of Ames. He moved here from Clear Lake, Iowa. Two hospitals in Mason City had been enemies for years and in a matter of 10 months, barriers broke down and consolidation took place. Those changes are taking place in our state and in our country. It is important for the community to look at the future of the economic development issue and embrace the changes that are occurring and not sit and wait for it to run over us. 3 Leo Milleman, 1215 Duff: Is a citizen, a physician, and President of McFarland Clinic. Would like to speak on why the physicians want change. The practice of McFarland Clinic extends well beyond the citizens and community of Ames. Two-thirds of the patients the hospital receives have no input. They need a way to address other clientele health care needs. They need structure and volume. The open meetings law is a problem, we do not have a common structure. He would like to have only one board to go to, make good decisions and go forward. The McFarland Clinic staff would be happy to talk to anyone. Leah Mully, 1207 Burnett: Is concerned about the status of nonprofit and the secrecy issue. She has been reading literature about nonprofit which indicate there is a lot of profit involved in those agencies. She has also read articles on MGMC violating the open meetings law. Mr. Klaus: We have one person who has called in twice. Lynn Richtsmeier of 3115 Roy Key Avenue. First call urged the Council to select an option that will actually be cost effective and save citizens money. Second call stated she likes the system we have now - I don't understand the need for change. Why change something that is working well. Joe Lyon, 1431 Grand Avenue: He is concerned with the number of people here representing MGMC or McFarland Clinic. Des Moines General Hospital is under the leadership of Quorum. He stated that he has worked with Harold Hughes, Pat Dorin, John Connors and members of Branstad's staff who have day-to-day contact with Des Moines General and the Council may want to contact one of them for information. This is an important decision-making process that will affect the future. The word used in Section 501(c)3 is "exclusively", not primarily. For that reason, the chances of MGMC qualifying as a 501(c)3 corporation are slim and none. They will become a 501(c)4 corporation. Under that scenario, it would mean that any and all contributions made to the hospital would not be deductible by the contributors. There is little difference between a for-profit and not-for-profit hospital. SECOND ROUND: Sam Pritchard, 912 Kellogg: It is not easy to separate the physician from the corporation, but it must be done. He would like to request the Mayor and Council offer the people details of governance for the not-for-profit hospital in the same format the for-profit hospitals have outlined their governance before selecting the preferred option. He would also like to ask staff to take a trip to hospitals owned by Quorum and OrNda and talk to the employees regarding health care. Emil Peterson: He was for the nonprofit option, but after hearing the discussions of the for-profit alternatives, he is not sure. The fair market value is more easily met with the for-profit option. A for-profit makes it easier to do vertical integration, and there is opportunity for local shareholder control. The taxability aspect would act as a drag on financial resources, but the not-for-profit option would also have a debt service that would drag on the resources. Mr. Klaus: Call in from David Smith, 911 Clark: He supports the local not-for-profit. A for-profit would take dollars out of the community. The for-profit might cut all staff and patients would lose in the long run. Citizen: Would like to see a point-by-point comparison of the options in the newspaper, including the present system which he supports. He is concerned about the secrecy issue and wants the hospital kept under an elected boards. Diana Risse, 612 South Dayton: Would like to ask the Council to think about the fact that MGMC doesn't just serve Ames - it does serve the region. Whether a for-profit or not-for-profit is chosen, please remember the whole region when picking a board. Mr. Klaus: John Elliott, 1207 Quebec: Called in and stated he supports the local not-for-profit option. Mayor Curtis asked the citizens present to stand for a for-profit, a not-for-profit, and a City for-profit shareholder, and no change. For profit - two people stood. Not-for-profit - overwhelming majority. City for-profit shareholder - four people. No change - seven people. 4 Joe Lyon, 1431 Grand Avenue: Would like the Council's consideration in the for-profit versus not- for-profit. The prospect of the hospital paying taxes is a negative, and he wants to know why. For the City of Ames to grow and look forward to a brighter future, one of the things that has to happen is an increase in the City's tax base. The best option is a business tax base, and this is an opportunity to turn a City asset into a potential tax revenue generating entity. Sam Pritchard, 912 Kellogg: Is disturbed by the vote. When we stand up and applaud, we should make sure that we know exactly what we are applauding. Council Member Wirth: Stated for the record she had not received the petition mentioned by Ginny Koch for the not-for-profit option. Council Member Brown: Wanted to clarify that she did serve on the Health Care Committee and the Health Care Committee did not endorse a single option, they asked that all other options be explored. The Mayor thanked everyone for their patience and participation. ADJOURNMENT: The meeting adjourned at 9:15 p.m. _________________________________ ______________________________ Jill Ripperger, Acting City Clerk Larry R. Curtis, Mayor _________________________________ Ginger Jones, Recording Secretary 5