Monday, April 21, 2014

Lawsuit Targets Critical Access - Newspaper article

Beverly Hussey contends hospital violated contract 

A lawsuit against Sutter Coast Hospital has been filed by the widow of the donor of the land where it was built, saying that plans to convert the facility to a Critical Access Hospital violates the donation contract stating Sutter must maintain an acute care hospital.
The lawsuit filed by Beverly Hussey also claims that three hospital board members who are also employees of Sutter Health violated the obligations of a charitable trust by not recusing themselves from votes to convert to Critical Access and to “regionalize” (merge the local hospital with a Bay Area-based Sutter corporation).  By voting, the board members were acting in their own interest and not the community’s, according to the suit. 
“The board members violated their respective duties against self-dealing because they stood to benefit from bonuses paid to employees of Sutter Health,” states the lawsuit filed March 26 by a Los Angeles-based law firm known for prominent anti-trust cases against large corporations. Since Critical Access status would increase revenue for Sutter Health, “the board members stood to benefit financially from their votes,” the suit states.
Michael Duncheon, Sutter Health’s regional legal counsel, said in an email that “Sutter Coast Hospital is and will remain an acute care hospital. Critical Access does not change that reality,” he said.
“The allegation that employees on the Board stood to benefit from regionalization is false and libelous” and could result in a countersuit, Duncheon wrote.

Donation was 26 years ago

In 1988, Francis “Sonny” Hussey donated several acres on Washington Boulevard to Sutter Coast Hospital on the condition that the property “shall be used primarily for healthcare related purposes. Permissible uses shall include, but not be limited to, acute care hospital, medical laboratories, medical offices, trauma centers, convalescent care and similar uses,” states the 1988 contract.
According to the suit, Sonny Hussey was motivated to improve health care in Del Norte County after a car accident in 1959 sent his loaded gasoline truck hurtling 150 feet down a mountainside.  
“For approximately eight hours Mr. Hussey lay undiscovered until a passing logger by chance saw the wreckage.  The logger clambered down the steep cliff and found Mr. Hussey only semi-conscious with a crushed chest,” the lawsuit states.  “Mr. Hussey’s near death experience triggered Mr. Hussey to donate an unprecedented and substantial amount of his real property to Sutter in order for Sutter to develop and maintain an acute care hospital.”
Sutter Coast Hospital, which was operating the old Seaside Hospital building on A Street via a lease through the Del Norte Healthcare District, agreed to build the hospital on the donated property, opening its doors in 1992.
“The old facility leaked and we had a lot of problems,” said Gerald Cochran, who as chairman of Sutter Coast Hospital in 1988, signed the agreement with Hussey.
The lawsuit states that Sutter Coast violated the contract for the donation on Dec. 5, 2013, when the Board of Directors “voted to change Sutter’s designation from a full service acute care hospital to a critical access facility.”
The plaintiff’s lawyers said that if the implementation of a Critical Access hospital continues during the lawsuit, they might seek a temporary restraining order and/or a preliminary injunction blocking the conversion.
“We definitely think there are strong grounds that would prevent the downgrade by looking at the contractual language and intent of the agreement,” said Majed Dakak, an attorney for the law firm handling the case, Blecher Collins Pepperman and Joye P.C. “What Sutter is doing  is really putting the community in peril.”

What’s an acute care hospital?

According to California state law, a “general acute care hospital” is a facility that “provides 24-hour inpatient care, including the following basic services: medical, nursing, surgical, anesthesia, laboratory, radiology, pharmacy, and dietary services.”
Sutter Coast Hospital has no plans to eliminate any of those services, according to Duncheon.
Since Sutter Coast is already qualified as a “rural general acute care hospital,” the facility is not required to provide surgery and anesthesia services, according to state law. Duncheon said that there are no plans to eliminate or even reduce surgical or anesthesia services.
The suit states that there is no incentive to maintain or expand services as a Critical Access hospital, “which is contrary to the language and intent of the (contract).”
In information provided by Duncheon, Sutter Health states that all services will remain under Critical Access designation, including: in- and out-patient surgery, OB services, “24/7/365 MD in the hospital for the Emergency Department” and “24/7/365 hospitalist,” lab services, radiology services, respiratory therapy services, rehabilitation services, 24/7 case management, and a pharmacy for inpatients.
State law clearly states that Critical Access hospitals are also considered general acute care hospitals:
“Every hospital designated by the department as a critical access hospital and certified as such by the United States Department of Health and Human Services shall be deemed to be a general acute care hospital.”
The state could waive certain acute care requirements for Critical Access hospitals if “it is in the public interest to do so” and “the waiver would not negatively affect the quality of patient care,” according to state law.
Asked how the plaintiff’s case would reconcile with the state law saying Critical Access hospitals are acute care hospitals, Dakak said “that’s going to get into legal strategy so I can’t comment on that.”

Critical Access concerns

The lawsuit states that if Sutter Coast converts to Critical Access as planned it will be “creating a tremendous burden on and at times a complete barrier to acute care treatment at Sutter.”
Since Critical Access facilities have a cap of 25 in-patient beds, there is likely to be an increase in patient transfers to other hospitals. The lawsuit says that a patient could be forced to wait for several hours while an acceptable facility is located to accept the patient.
Sutter Coast interim CEO Linda Horn recently wrote in a Triplicate Coastal Voices piece that “if we were already a Critical Access hospital ... in the last 12 months, we would have had to transfer approximately 40 additional patients out.”
Horn said this would be a 6 percent increase in patient transfers while acknowledging that “I understand that if you are one of those patients, it doesn’t matter to you if it’s one or 40.”
Beverly Hussey, who has had to go to Sutter Coast several times but has never been air-ambulanced to another hospital, was less not impressed, saying of Horn’s writing: 
“She’s telling everyone how wonderful it’s going to be while encouraging everyone to join Cal -Ore Life Flight.” 

Necessary to stay afloat?

Besides the claims based on Sutter Coast not maintaining an acute care hospital, the lawsuit ‘s other claim is based on certain Sutter Coast board members acting in their own self interest, violating the hospital’s charitable trust status.
“These board members, who stood to benefit directly or indirectly, by virtue of transferring hospital ownership and governance, should have recused themselves but instead participated and voted for regionalization” and to “downgrade the hospital’s status,” the lawsuit states.
Sutter Coast officials have stated that converting to a Critical Access hospital, which receives cost-based Medicare payments, is necessary to stay financially afloat, but the lawsuit alleges that the conversion is being pursued out of “corporate greed” in an attempt to “game the system.”
The lawsuit states that Sutter Coast was profitable every year from 1985 until 2010 (Sutter officials said that the hospital has had financial losses since 2009). In 2011 the hospital started operating without a chief financial officer (illegally, according to the lawsuit).
“Thus, the decision to convert to Critical Access was based on claims of financial losses during the only period in Sutter’s history when the hospital was illegally operating without a Chief Financial Officer,” the lawsuit states.
This was the also the time that the hospital was moving toward regionalization, and the lawsuit claims that the votes for regionalization and Critical Access violated the obligations of a charitable trust, including “its duty to avoid self dealing.”
Duncheon responded that the hospital has always operated with the “requisite financial staff” and that when the locally-based CFO, Jim Strong, stepped down, his duties were fulfilled by John Gates a Sutter CFO based in San Francisco.
“There is no merit to the claim that an alleged lack of CFO had anything to do with the losses,” Duncheon said.
In February, Mrs. Hussey and her attorneys sent a letter to Sutter Coast demanding that the hospital retract the decision to downgrade, as the contract gives Sutter 30 days to correct violations of the contract.
“Sutter has refused to alter its decision to downgrade the hospital status,” the lawsuit states.
Reach Adam Spencer at

Saturday, April 19, 2014

Guest Editorial by Dale Bohling

Today's newsletter is a guest editorial by Dale Bohling, a former railroad employee of 37 years who served his local labor union as an in-shop representative, and a current resident of Crescent City, CA, where the Sutter Coast Hospital Board of Directors (at the recommendation of Sutter Health executives) has voted to take the following actions:
(1)  Dissolve themselves as the hospital's governing body.
(2)  Transfer ownership of the region's only hospital from within the community to a corporation in San Francisco which is controlled by Sutter Health.
(3)  Downsize the hospital by 50% in order to qualify for higher Medicare payments.  
Steps (1) and (2) are on hold "for the time being" due to public outcry.
Sutter Health executives state these moves are needed for financial reasons, claiming Sutter Coast Hospital ("SCH") has not been profitable since 2008.  A quick fact check reveals otherwise.  SCH's IRS Form 990 shows a net revenue of $6.5 million in 2010.  In 2009, profits were $759,000.  (source:
Sutter Health's net profits in 2012 were $735 million. (source:  Sutter Health executives doubled their own salaries between 2007 and 2012, including Sutter Health CEO Pat Fry, whose compensation increased from $2,287,163 in 2007 to $6,393,883 in 2012 (source: Sutter Health IRS Form 990).
SCH CEO Linda Horn claims the hospital is closing beds which "are empty every day--and have been for years."  That statement is false.  Read on to see the facts . . .  

      There's no sugar-coating in-patient bed reduction        by Dale Bohling
Why does the story of Little Red Riding Hood come to my mind as I read Sutter Health executive Linda Horn's latest attempt  to assuage community trepidations over Sutter Health Corporation's dual decisions to convert Sutter Coast Hospital  to Critical Access and to move the governing board hundreds of miles away from the community? ("Same services offered under Critical Access", published 4/4/14 in The Del Norte Triplicate).
Maybe  it was the wolf's cloaking of his evil intentions as well as his ravenous appetite that sparked the comparison. It may also have been the vulnerability of Little Red Riding Hood as she began to realize that appearances can be deceiving which is seemingly what emerges within our community with  each sugar coated apologetic  presented to the community by Sutter Health.
While taking four whole paragraphs to set the stage for her intended splurge, Ms. Horn painted the canvas with images of hospital staff being awarded for their dedication to their patients and recognition of career tenure by their employer.  Along the way she sprinkled flowers of good will with her sharing of Sutter Health's magnanimous philanthropy in the community.  An altogether rosy picture emerged of a community and the beneficent corporation that built and maintained the local full service hospital. That is, of course, an idealized picture of how things SHOULD be and seemingly HAVE been.  Enter the  cloaking:
"It is our commitment and desire to continue being a full service hospital and an active community partner", Ms. Horn wrote. She avoids explaining  how to reconcile that statement with the fact of intent by Sutter Health  to reduce that hospital by half.  How does dividing something by half allow it to remain the same as before the division?
If the answer lies in the simple closing of doors, with beds that are "empty every day--and have been for years", as Ms. Horn asserts, I see little cause for concern. But Ms. Horn's assertion is simply NOT TRUE.  Here are the facts:  
(1)  The beds have NOT been empty for years.  According to Sutter's own website, there were 62 days in the period 1/1/12 to 6/30/13 when the hospital census exceeded 25, including multiple days within the last year.  (source:
Remember, Critical Access hospitals begin shipping adult, non-maternity patients when the census is just 22, so the impact is even worse than it at first seems.
How can Ms. Horn's  statement be viewed as anything other than a deliberate deception or ignorance of Sutter Coast's own data which was released to the Camden Group to be used in their study?
(2)  Closing doors is not what actually takes place.  The rooms are not just closed, they are locked.  Permission to remove the locks must be obtained from some unspecified government agency, in the event of a declared emergency or disaster, when time is of the essence.  
(3)  The concomitant evisceration of the attendant staff whether highly skilled or ancillary, top to bottom, cannot be reversed by declaration of the state or anyone else.
People will lose their livelihood as their training and skills are stripped away from the full service setting owing to Critical Access designation.  Yet this loss of dedicated hospital staff is presented by Ms. Horn as being instantly replaceable at the time of an extraordinary event involving a mass influx of casualties, like merely opening doors and dusting off sheets.
Is Ms. Horn saying that a flood of volunteers will come to the fore to fill in the gaps? Volunteers will do what they are trained to do, but what of medical skills?
Does Sutter Health expect us to believe they can muster a fully trained staff with a snap of the fingers?
Equally inexplicable is the concept of being an active (caring?) community partner while simultaneously  removing any semblance of local governance 300+ miles distant where any meaningful input would be negligible. A good community partner does not cause members of that community additional grief by shipping them off to distant hospitals for care, leaving them devoid of the support of loved ones and the additional financial burden of getting a 2nd mortgage on their homes to finance transportation back home while in a recumbent state. Woe to he who falls ill under the shadow of Critical Access.
As a sedative to a concerned community, Linda Horn offers this choice parsing of words: "Remember that a  viable full service hospital will sustain real estate values, jobs and services in our community. We are offering the same services after our CAH designation as we offer today". Yes, Ms. Horn, the same services, only HALVED.
Dale L. Bohling
Crescent City
Here's how you can help:

If you wish to retain local ownership of a full service, non-Critical Access hospital in our region, please write to the Board of Supervisors, 981 H. St., Crescent City, CA 95531.  Our Supervisors have asked Sutter to reconsider their actions and release their data to the public.  Sutter refuses to comply.  But our elected leaders have the authority to end this conflict with Sutter Health by exercising their right of eminent domain, to hold Sutter accountable to the promises they made to this community when they were invited here--to provide expanded services and improved quality of care.  GJD

Please forward this email to friends and post on social media.

Sunday, March 23, 2014

Guest article by Shellie Babich, Healthcare District Chair

March 23, 2014 
As many readers are aware, Sutter Health has taken action to downsize and take ownership of Sutter Coast Hospital.  Today's newsletter by Shellie Babich, Physician Assistant and Chair of the Del Norte Healthcare District, informs our community on the steps our elected leaders are taking to preserve and expand access to hospital care in our region.  Past newsletters are available at

I appreciate all of your feedback, and encourage anyone with ideas on improving healthcare services in our region to contact me at 707-465-1126 or by email at   Please forward this newsletter to friends, post on your social media sites, and send me an email if you are not receiving these free newsletters but would like to add your name to our list of recipients.

Before we get to Shellie's article, and before you read anything about the hospital, please ask yourself two questions:

(1) Is the information from someone with a financial tie to Sutter?
(2) Did the person giving the information sign a confidentiality agreement for Sutter?

In my case, and for Shellie, the answer to both questions is "no."


Greg Duncan, M.D.
Your Healthcare District Takes Action to Save Medical Care for Our Region

by Shellie Babich, Chair, Del Norte Healthcare District

As a lifelong resident of Del Norte County, local healthcare provider, and Chair of the Del Norte Healthcare District Board, I write to inform readers on the history of Sutter Health in our region, and how your Healthcare District Board is working to preserve and expand your access to affordable healthcare.

Twenty eight years ago, the Del Norte Healthcare District invited Sutter Health to manage our locally owned hospital.  In exchange for a monopoly over hospital care in our region, Sutter Health promised to manage a locally owned hospital, governed by a local Board of Directors, with expanded services.  The Healthcare District promised to not compete with Sutter Coast Hospital.  For 26 years, this relationship served our community well.

Then, on November 3, 2011, the Board of Directors of Sutter Coast Hospital ("SCH") abruptly and unilaterally chose to end their relationship with this community.  Without engaging the public, notifying hospital medical staff or employees, or consulting with the Healthcare District, the SCH Board voted to transfer ownership and governance of Sutter Coast Hospital to a corporation located in San Francisco and controlled by Sutter Health. The transfer of ownership was part of a Sutter Health statewide strategy called "Regionalization." The SCH Board did not read the bylaws of the corporation which would become owner of Sutter Coast Hospital before they voted to transfer hospital ownership to that corporation, nor did they look at any options other than those recommended by Sutter Health executives and attorneys.

Why is hospital ownership so important?  Because under regional ownership, every future decision affecting our only hospital will be made by a Board of Directors in San Francisco.  One such decision, which was actually made by our local Board (at the recommendation of Sutter Health executives), is their recent choice to downsize Sutter Coast Hospital by 50% in order to qualify for higher payments for the care of Medicare patients, under a federally subsidized program called "Critical Access."

Sutter's decision to downsize the hospital to a Critical Access facility brings several guarantees:

(1)  More profits for Sutter Health.
(2)  More patients flown out to other hospitals.
(3)  A cap on future growth of the hospital.
(4)  Fewer local jobs.

When a hospital downsizes, the staff is also downsized, and employees without work will leave our county.  Just this week, Sutter Health announced that local hospital employees will have their jobs eliminated as part of a statewide Sutter plan known as "centralization," whereby local jobs are outsourced to Sutter's regional service centers.  Sutter claims all these changes are needed to stem financial losses.  In 2012, Sutter Health reported net profits of $735 million.
The Healthcare District opposes to Sutter's decision to outsource local healthcare related jobs.  In fact, in our Temporary Restraining Order filed against Sutter, we successfully blocked Sutter from transferring jobs out of the county, in order to protect hospital employees while the lawsuit was heard. 

If Sutter is permitted to "regionalize" us, every future decision affecting our healthcare will be made by a distant Board.  This includes whether or not to continue supporting current hospital service lines (such as Pediatrics, Obstetrics, and Intensive Care), surgical equipment (for orthopedic and general surgery, eye surgery, and urology), and diagnostic machines (MRI and CT scanners, nuclear medicine, and ultrasound). In addition, patient care policies, employee benefits, staffing levels, contracts with physicians and employees, and how much to charge for your care--all will be decided in a Board room in San Francisco, closed to the public. Many local residents who have received care at Sutter Coast have expressed concern over Sutter's high charges for care and aggressive collections practices.  If Sutter Health takes ownership of Sutter Coast, we will have no local recourse to address these concerns, and no authority over the future of the hospital, forever.

Your elected Del Norte Healthcare District Board believes both of Sutter's decisions (Critical Access and Regionalization) were made for the benefit of Sutter Health, and are not in the best interests of this community.  On January 28, 2014, the Del Norte Healthcare District unanimously resolved that Sutter Coast Hospital should remain a locally owned acute care hospital, not a Critical Access hospital owned and governed from San Francisco.  Since it is clear Sutter Health is determined to enact its corporate plans, and end its longstanding relationship with our community, the Healthcare District is taking action.

To date, three healthcare systems other than Sutter Health have expressed an interest in a closer affiliation with our community.  In addition, a Healthcare District subcommittee initiated discussions this week with a national healthcare firm which has evaluated our market and stands ready to assist in any capacity the District requests.

In any challenging environment, a trustworthy partner is essential.  Sutter Health, with their closed Board meetings, mandatory confidentiality agreements, inconsistent statements, and refusal to honor county requests to release documents, is no longer a trusted partner.  I understand healthcare is changing, and our community needs to adapt to those changes.  But our primary mission must be to serve our citizens, not a distant corporation.

The Del Norte Healthcare District, in collaboration with other county and city leaders, is committed to providing accessible and affordable healthcare to the 42,000 residents and thousands of yearly visitors to the hospital service area.  We appreciate your input thus far and look forward to working with you in an open, honest, and transparent manner in the years to come.


Shellie Babich
Chair, Del Norte Healthcare District

Saturday, March 15, 2014

The Future of Healthcare in Our Region

The Future of Healthcare in Our Region

Today's guest editorial is written by Dr. Kevin Caldwell, a local Family Practice physician and frequent recipient of Del Norte County's "favorite physician" award.
Before we get to Dr. Caldwell's article, I would like to thank everyone who responded to the request by the California Department of Public Health for community input regarding Sutter's decision to convert Sutter Coast Hospital into a Critical Access facility. In addition to the letters you sent separately, I forwarded 115 letters of opposition to Critical Access, written by residents of Del Norte and Curry Counties, to the Calif. Dept. of Public Health last week.
Please forward this newsletter to anyone who may be interested, and post it on social media.  I also appreciate your emails with ideas on this issue, and how to improve transparency and affordability of healthcare.
Gregory J. Duncan, M.D.

Our Healthcare Decisions Must be Based on Fact  and Transparency

by Kevin Caldwell, M.D.
As a current Del Norte Healthcare District Board member, three term former Chief of Staff and Board member of Sutter Coast Hospital ("SCH"), and local physician for the past 29 years, I would like to clarify some information published in last week's Del Norte Triplicate which may have left readers confused as to the ownership of SCH.  As you read articles on Sutter's plans for our community, please ask yourself if the information was written by someone who receives money from Sutter Health.  I have no financial ties of any kind with any Sutter corporations.

First, a definition of Regionalization:  a Sutter Health statewide policy to transfer ownership of community owned Sutter affiliated hospitals FROM local ownership TO regional ownership.  In our case, Regionalization would transfer ownership of Sutter Coast Hospital (which has always been owned and governed locally) FROM Del Norte County TO Sutter West Bay Region in San Francisco. 

Sutter Coast Hospital is currently owned by the corporation of Sutter Coast Hospital, and is governed by a Board of Directors, the majority of whom reside locally.  SCH is affiliated with, and managed by, Sutter Health.  How do I know this?

(1) The settlement agreement between Sutter Health and the Del Norte Healthcare District states, "Sutter Coast Hospital owns Sutter Coast Hospital."  In the first draft of the settlement agreement, Sutter attorneys inserted the statement, "Sutter Health owns Sutter Coast Hospital," but the Healthcare District made Sutter Health remove that statement, because it was false. Nevertheless, SCH CEO Linda Horn continued to spread the false claim that Sutter Health owns SCH.

(2)  Sutter West Bay Region President Mike Cohill, in a recorded meeting held in Del Norte County on 8/2/12, stated that Sutter Coast Hospital is owned by Sutter Coast Hospital.  

(3)  Sutter Coast Hospital currently has its own Board of Directors, bylaws, Articles of Incorporation, and tax I.D. number, all of which are dissolved with Regionalization.   

In last week's Del Norte Triplicate, editor Richard Wiens quotes the following from the Settlement Agreement between Sutter Health and the Del Norte Healthcare District: "Sutter Health has been the sole general member of Sutter Coast Hospital, with the right to exercise control over it, since its inception."  I suspect few readers understand the meaning of that statement.

The "General Member" is Sutter Health. In some corporations, the General Member is all-powerful.  In our case, the General Member is not--Sutter Coast has a number of powers over Sutter Health.  "Control," in the sense used here, is a legal term which means Sutter Health has the power to appoint the majority of the SCH Board.  "Control" does not mean Sutter Health can do whatever they want--their powers are limited by SCH bylaws, Sutter Health bylaws, Medicare regulations, Joint Commission standards of hospital accreditation, and California law.  Evidence of Sutter's repeated violations of these regulations, and California law, will be detailed in future articles.

According to Mike Cohill, Sutter Health and SCH are separate corporations, each with its own unique powers (which Mr. Cohill calls "reserve powers"), as defined in the bylaws of each corporation. One of SCH's reserve powers is the authority to approve and disapprove of mergers.  In other words, Sutter Health cannot transfer ownership of Sutter Coast out of Del Norte County (Regionalize) without the approval of the Board of Directors of SCH.

The SCH Board did vote to Regionalize on 11/3/11, over my objection. I advised my fellow hospital Board members that we should not vote on something we did not understand.  The Board had not read the Regional bylaws before voting to Regionalize, although three hospital Board members falsely stated they had read the Regional bylaws in advance of the Regionalization vote.  I know this because the Regional bylaws were not distributed to the SCH Board until 11/8/11, five days after the vote to Regionalize. So, the hospital Board voted on a policy they had no way of understanding.  Does a Board have a responsibility to cast an informed vote?

In 2011, Sutter Regional executive Larry Dempsey, Esq., re-wrote the bylaws of SCH, weakening many of the hospital's reserve powers over Sutter Health.  Mr. Dempsey did not explain this fact to the SCH Board, which had no independent legal counsel. On 2/3/11, following minimal discussion, Mr. Dempsey's 1300 changes to the SCH bylaws were approved by the SCH Board. 

The California State Bar is the agency which oversees attorney conduct.  It is a Bar rule that one attorney cannot represent two parties without the written informed consent of both parties. Sutter Health  attorneys never obtained consent from SCH before re-writing the SCH bylaws or asking the SCH Board to dissolve themselves and transfer hospital ownership to San Francisco.  Dr. Duncan and I filed a complaint regarding two Sutter Health attorneys to the State Bar, which is currently under review.   

The fact is, despite overwhelming community opposition to Sutter's plans for this region, Sutter refuses to budge.  Sutter Health is determined to end their 28 year relationship of managing a locally owned, Acute Care hospital in Del Norte County. The SCH Board refused to rescind their Regionalization vote. Regionalization remains SCH Board policy.  Sutter will not release any Board meeting minutes. Last May, SCH CEO Linda Horn announced in a televised meeting that "Critical Access is not being discussed," even though the SCH Board had just approved a $170,000 study on the hospital which mandated an analysis of Critical Access.  In December, the SCH Board voted for Critical Access. Last month, they filed the application.

The SCH Board refuses to discuss community letters of concern in the Board room, which remains closed to the public.  Sutter Coast's ongoing secrecy and high prices have compelled many in our community to seek care at distant hospitals, resulting in a steady decline in our hospital census over the past year.

During our 1/28/14 meeting, the Del Norte Healthcare District voted unanimously to oppose Critical Access and Regionalization.  The Triplicate did not report on that resolution, so the District ran the announcement as a paid advertisement.  We believe our community deserves options for their healthcare. Three other healthcare systems have offered to provide capital to develop an affiliation with our hospital.   Please share your thoughts with me and my fellow  Board members at: The Del Norte Healthcare District, 550 E. Washington Blvd., Crescent City, CA  95531.  We want to hear from you.

Kevin J. Caldwell, M.D.
Redwood Family Practice
Crescent City, CA

Saturday, February 15, 2014

How to stop Sutter from downsizing our hospital

Working together, we can stop Sutter Health from implementing their corporate plan for our healthcare
Yesterday, I was contacted by the California Department of Public Health (CDPH) regarding Critical Access Designation at Sutter Coast Hospital.  CDPH is seeking input from local residents.  They want to know if local residents approve of downsizing the hospital, and how it will affect you and your loved ones.  They asked where we will be transferring patients when the hospital is full due to the 25 bed cap imposed by Critical Access.  (Answer:  Wherever a bed is available between Portland and San Francisco). 
At the end of this guest editorial, please read how you can help stop Sutter Health from downsizing our region's only hospital.

Guest Editorial by Leah Eidam, Crescent City, CA

On 12/5/13, Sutter Health executives and the Sutter Coast Hospital Board voted to downsize Sutter Coast to a Critical Access Hospital.  In response, the Del Norte Healthcare District, a local government body elected to promote health services for county residents, voted unanimously to oppose Sutter's plans. The Healthcare District resolved to "explore all alternatives to maintain local ownership and shared governance of our hospital."

Sutter wants you to think they cannot be stopped.  They are wrong.  Let's support the Healthcare District and tell Sutter it is NOT over.   The State of California and the Federal Government will decide whether Critical Access will be granted to Sutter Health.  That means YOU not Sutter Health will make the decision.  Voice YOUR opinion.

What YOU need to know:

1) Sutter Health is a tax-exempt public benefit charity funded by billions of dollars in tax-exempt bonds.   Their purpose for existing is to help YOU.  This is very important to remember as you read further.
2) A Sutter Executive has said that Crescent City "was not sophisticated enough" to understand Regionalization.  Was he talking about YOU?
3) Sutter Hospital rates are roughly 60% higher than other hospitals in California.  Does that hurt YOU?
4) The steady decline in privately insured patients at Sutter Coast is due, in large part, to patients from Crescent City travelling to other hospitals in California and Oregon, where the same care costs 60% less than at our local hospital.  Do YOU have to travel for your healthcare?


1) Between 2007 and 2012 many Sutter Health executives doubled their own compensation.
2) Sutter Health CEO Pat Fry's compensation increased from $2,287,763 in 2007 to $6,393,883 in 2012.  That's a $4,106,120 increase--almost triple.
3) In 2012, the top 10 Sutter Health executives were paid a total of $27,644,426.  That's millions, folks.
4) Their salaries are paid from YOUR hospital bills.  Remember the 60% more YOU pay at Sutter Coast.
5) Every year from 1985, when Sutter took over the hospital, until 2010 the hospital was profitable.  The only time the hospital reported losses was after they got rid of the Chief Financial Officer. 
6) There has been no independent audit of the Hospital finances since 2007. 
If all of this seems very unfair, YOUR help is needed.  Remember YOUR hospital is a tax-exempt public benefit charity.   There are avenues available to BLOCK conversion to Critical Access.

In addition to Sutter's plan to downsize our hospital to Critical Access, do YOU want to continue to support and pay exorbitant salaries to executives in San Francisco by paying 60% more for your health care?  If the answer is no, please read on to learn how to stop Sutter Health . . .


Take a few minutes to write a letter.  Three sentences is enough.  Here are some facts for letters:

  • Critical Access was funded in order to improve healthcare access by subsidizing tiny hospitals.  By cutting beds to qualify, Sutter is using the program to reduce access to care in order to increase their payments from Medicare. 

  • At Sutter Lakeside Hospital, where Sutter cut beds to qualify for Critical Access designation in 2008, emergency patient transfers out of Lakeside quadrupled, and Sutter Lakeside became the number one recipient of Medicare funds among the nation's 1300 Critical Access hospitals.

  • Critical Access at Sutter Coast will result in patients being airlifted to outside hospitals--at the patients' expense, separated from their family, friends, and local doctor, and responsible for their return trip home. 

The California agency which oversees hospitals converting to Critical Access states the program is intended to preserve access and improve quality of healthcare services to rural Californians.  If you believe downsizing the hospital does not fit that goal, write letters to:

(1)  Dana Forney, California Department of Public Health, Licensing and Certification, 2170 Northpoint Parkway, Santa Rosa, CA  95407  

(2)  Alex Garza, CAPT, USPHS, Centers for Medicare and Medicaid Services, Division of Survey and Certification, 90 7th St, Suite 5-300 (5W), San Francisco, CA 94103-6707  (Mr. Garza's email is

(3) The Del Norte Triplicate, 312 H. St., P.O. Box 277, Crescent City, CA  95531.  Include your city and phone number at the bottom of the letter.  Phone numbers are not published but allow the paper to contact individuals submitting letters.

If you need help with letters, have information to share, or would like to write an article for this newsletter, please call me at 707-465-1126 or email to  Join the more than 3,000 local residents who oppose Sutter's plans by signing the petition at my office on 1200 Marshall St., Crescent City.

Greg Duncan, M.D.

Thursday, October 31, 2013

The facts behind Sutter Health's media blitz in Crescent City

Subject: The future of hospital care in our region
Sutter Health's Media Blitz is Oncoming
October 31, 2013
Dear Fellow Residents of Del Norte and Curry Counties:
This coming week, Sutter Health will release its long awaited "independent" study on Sutter Coast Hospital.  This newsletter will provide some balance and background to Sutter's public relations campaign.

I am writing this update on the future of Sutter Coast Hospital because the hospital Board of Directors, of which my husband Dr. Greg Duncan is a member, voted to censure Greg for allegedly releasing confidential information outside the Board room.  Sutter Health and the hospital Board refuse to provide any written specific charges or evidence to support their allegations, so until we understand the implications of the censure, I will be writing newsletters.
Sutter Health is now beginning its final push to take ownership of Sutter Coast Hospital.  As Sutter's public relations blitz begins, please remember these facts:  (1) Sutter Coast Hospital is now owned and governed locally.  Regionalization is a change in ownership and governance.  If we Regionalize, local ownership and governance will be lost, and all future hospital decisions will be made by a Sutter-appointed board in San Francisco.    (2) Under Critical Access Hospital designation, 24 of our 49 inpatient beds would be closed.  If Critical Access is implemented here, people will be transferred elsewhere as a result of the restriction in hospital bed count.  People who have conditions that could be treated locally will be transferred to distant hospitals.  (3) The Healthcare District lawsuit had nothing to do with hospital ownership--it was an effort to hold Sutter Health accountable to its promises to provide expanded care and maintain a local hospital Board, in exchange for the monopoly privilege of operating the only hospital in the county. The lawsuit was settled when the cost became prohibitive for the District's small budget. What the settlement did prove is which side had more money.

But the lawsuit bought our community precious time to become educated on these issues.

The statement in today's newspaper that Sutter Coast Hospital is the rightful property of Sutter Health is meaningless.  Sutter Coast Hospital has always been locally owned and governed. Regionalization is a change in ownership--if Sutter Health already owned the hospital, they would not have needed to ask the the local Board to vote for Regionalization.

During a recorded meeting on 8/2/12, Sutter Health Sr. Vice President Mike Cohill stated to our hospital Board and Medical Staff that Sutter Coast Hospital owns Sutter Coast Hospital.  In 2006, Sutter Health Vice President Brian Hunter declared to the Alameda County Superior Court, "Sutter Health does not own any hospitals," adding, "Sutter Health's function is to provide support to the affiliated hospitals.  Absent a specific grant of authority from a hospital corporation, Sutter Health is not authorized to act on behalf of the hospitals..." [Case no. RG05221764]

As you review the results of the hospital study, please consider the following:

(1) The soon to be released "independent" study on the future of the hospital was coordinated and funded by Sutter.

(2) The independent funding for the study withdrew their support over concerns that the study results had been predetermined in favor of Sutter Health.

(3) The local "Steering Committee" was chosen not by the hospital Board, nor by an open invitation for community participation, but by an undisclosed process controlled by Sutter Health.

(4) The study consultants performed no independent financial analysis, but instead relied on financial data provided by Sutter Health.

(5) Sutter required local residents on the Steering Committee to sign a confidentiality agreement.  Greg will not sign an agreement which prevents him from sharing information on the future of the hospital with the public.

Now, let's review a point of agreement with Sutter Health:  our local hospital has been in decline.  The decline is understandable, given the fact that Sutter Health has shifted its focus to healthcare delivery in urban areas.

Does it make sense to transfer hospital ownership to San Francisco, or should we engage partners who specialize in rural healthcare and operate in our region? 
Fortunately, three other hospital corporations are interested in serving our community.   Asante Health system (which operates Rogue Regional Medical Center in Medford, Three Rivers Hospital in Grants Pass, and Ashland Community Hospital) has a proven track record of profitability and patient care excellence.  Asante would like to partner with this community.  

As you review Sutter Health's upcoming presentation and public relations efforts, please remember our community has three options:

(1) Continued local ownership and governance, with management by Sutter Health.

(2) "Regionalization"--change of ownership and governance to a San Francisco based Sutter Corporation.

(3) Affiliation with a new partner, such as Asante, which has publicly expressed an interest in a closer affiliation, specializes and excels in rural healthcare, and is in our region.

If you have questions, ideas, or would like to receive future newsletters, please email me at
Please feel free to post this email on social media, forward it to anyone you wish, or stop by our office on 1200 Marshall St. to add your name to the 3200 residents who have signed the petition opposing Regionalization.  We also need more volunteers in Crescent City and Brookings to help distribute newsletters to those without internet access!  Thank you all for your help and support.


Anne Marie Duncan, M.D.  

This email was sent to by  
Gregory J. Duncan, M.D. | 1200 Marshall St. | Crescent City | CA | 95531

Sunday, August 18, 2013

Latest Information on the Future of Sutter Coast Hospital

Latest Information on the Future of Sutter Coast Hospital
August 10, 2013 
In This Issue
First, I write to thank the Board of Supervisors for sending another excellent letter to Sutter Health, reiterating the Supervisors' ongoing opposition to Sutter Health's plans to dissolve our local hospital Board of Directors, and transfer ownership and governance of Sutter Coast Hospital to a San Francisco based Board appointed by Sutter Health.  The latest letter, addressed to Sutter Health CEO Patrick Fry and Sutter Coast CEO Linda Horn, repeated the Supervisors' concerns with Critical Access, including the facts that "the program would eliminate 50% of our hospital beds, necessitating hundreds of emergency patient transfers every year to distant hospitals, at the patients' risk and expense, and without their family or local doctor at the receiving hospital."  The Supervisors also noted that Critical Access would precipitate significant layoffs at Sutter Coast.

Sutter Health's response to the Supervisors' latest request for records was blunt.  During last week's hospital Board meeting, Sutter Health Regional President Mike Cohill stated, "we will not be releasing our meeting minutes to the Board of Supervisors or anybody else."

I understand Sutter Health is not legally obligated to release our hospital meeting minutes, but I certainly agree with several Supervisors who requested Sutter Health release the data and meeting minutes.  I fully agree with Supervisor Finigan, who advised in open session, "If you really want an open discussion, then release the data."   

Together with the Board of Supervisors and the Healthcare District, I will continue to work to preserve a full service, locally owned hospital, and prevent downsizing to a Critical Access facility.

Second, we have identified another problem with Critical Access--it will increase costs to patients, and not just costs of transports to distant hospitals.  In order to reduce the number of emergency patient transfers imposed by the Critical Access bed limit, Sutter's consultant wrote the following:  "the Hospital [Sutter Coast] can aggressively use observation bed services; however, this may not be sufficient to allow the Hospital to eliminate the transfer of patients outside the community." 

Observation patients are short term patients, who are not counted as part of the patient limit imposed by Critical Access.  Observation patients may not be commingled with patients on the inpatient nursing units in Critical Access Hospitals, and are subject to higher charges than standard patients admitted to the hospital.  Here is quote taken from the 2012 Sutter Coast Hospital Critical Access study:  "The beneficiary may not be aware that observation stays fall under [Medicare] Part B and require coinsurance and possibly other CAH charges."  According to Medicare regulations, "the beneficiary in an observation status will be liable for a coinsurance charge equal to 20% of the CAH's customary charges for the services."
(Regulation 485.620(a), 6/7/13)  

One should also know unless the hospital elects to place their observation patients in some of the 25 available hospital beds, they will need to occupy a stretcher.  Only 25 hospital type beds are allowed in Critical Access Hospitals.  Of course, on busy days like June 28, when there were 36 inpatients plus two observation patients in Sutter Coast Hospital, it will be necessary for many patients to be transferred elsewhere, due to the 25 bed limit.  Our patient numbers are typically lowest during the summer months.  What will happen during the busier winter months, when respiratory illnesses are common?

The hospital Board also held a discussion on Critical Access during our 8/1/13 meeting, which Sutter Health executive Mike Cohill concluded by stating he believed the Critical Access program would inevitably be implemented here in Crescent City, while acknowledging he had not spoken to Asante or any other potential management firms.  

If you have ideas or comments you would like to share, please send them to me at the email address below, or stop by my office on 1200 Marshall St. to learn more or add your name to the more than 3,000 local residents who have signed a petition opposing Regionalization and Critical Access designation for Sutter Coast Hospital.  To join our email newsletter, just send me an email at

Next issue: The story behind the resignation of Sutter Coast's excellent former Chief Financial Officer, and the ensuing reports of financial losses for the first time in the hospital's history.



Gregory Duncan, M.D.
Chief of Staff
Sutter Coast Hospital