By VICKI URBANIK

Sold.

After nearly 70 years as a public, county-owned hospital system, Porter Memorial Hospital will cease to exist in a few days, with its buildings and most assets turned over to the nation’s largest for-profit hospital chain, Community Health Systems of Brentwood, Tenn.

The Porter County Commissioners, Porter County Council, and Porter Memorial Board of Trustees all voted unanimously Tuesday to sell the county hospital, in exchange for a cash payment of at least $80 million and a commitment by CHS to build a new, 225-bed hospital with all private rooms within four years.

The decision to sell the hospital prompted a round of applause from the audience of about 150 people who gathered at the Memorial Operate House for the special meeting.

The closing is scheduled for this Tuesday.

With hospital investments added, the total amount that will be turned over to the county is expected to be $120 million.

How the proceeds will be used is still undetermined. A majority on the county council earlier squashed the original proposal to place the proceeds in a private trust, and the three boards on Tuesday adopted resolutions calling for the proceeds to be placed in accounts that will be controlled by the council and commissioners.

The significance of the decision was not lost on some of those who voted to sell. “I think this is the biggest decision that’s ever been made” in Porter County, said hospital board member David Butterfield.

For years, a sale of the county hospital has been discussed off and on, at times becoming an election-year topic. In more recent years, the Porter County Commissioners appointed a number of new hospital board members, during a time when the board found itself repeatedly facing criticism over such things as board secrecy, executive salaries and qualifications, and the hospital’s name change.

“Treason”

Most of the hospital board members, commissioners, and council members who made comments before they cast their vote spoke of the difficulty of the decision and their hopes for a better health care. But there was one exception.

Porter County Council member Jim Burge, R-at large, said he was disenchanted from the beginning of the hospital sale discussions, when the focus seemed to be on a new hospital and the proceeds, but not on patient care.

In a stinging criticism of the hospital board, he cited complaints of nepotism, cronyism, and a lack of oversight. “A lot of that led to where we are today,” he said.

He went so far as to say that if there were a painting done about the hospital and the years that led up to the sale, he would call it “Treason,” characterizing hospital officials as violating the public trust. He also said he supports the sale. “Let’s get it in the hands of the professionals,” he said.

“A Good Thing”

Others who spoke were more upbeat.

County Commissioner President Robert Harper, who suggested that the hospital should be sold or leased shortly after he got into office, commended the citizens who served on the various boards over the years that studied hospital issues. One of those committees issued a highly critical report in late 2005 that called on the hospital to merge with a larger institution in order to remain viable.

Harper said the sale will lead to better health care for the people of Porter County. “This is a good thing. It’s a good thing for health care,” he said.

Similarly, North Porter County Commissioner John Evans, who once was an opponent of a hospital sale, said that throughout the years, one thing has remained constant at Porter Memorial: A high quality of care. The hospital staff has been doing the best they can with an inadequate hospital, he said. “We need to give them a better facility,” he said.

Speaking from the county council, member Matt Murphy, R-3rd, said he makes no apology for earlier asking tough questions about the sale, saying that the issue deserved close analysis. Similarly, council member William Carmichael, R-at large, said he’s happy that the proceeds will be controlled by elected officials, and not placed in a private trust as originally proposed. Carmichael earlier presented details on how much tax money had been spent on the hospital to counter those who erroneously thought that the hospital had never been tax supported.

Carmichael also said a new hospital is needed. “I hate to see the old one go, but it has to be,” he said.

Council member Michael Bucko, D-4th, likened Porter Memorial to a “small mom and pop” store struggling but still failing when faced with major competitors like Wal-Mart and Meiers.

Hospital board member Barb Young said the “unsung heroes” are the hospital staff. She said the hospital sale will “give them finality,” as well as a state of the art facility and a role in governance at the new hospital. Dr. William Nowlin said CHS will be able to spend the money needed to improve and expand health care.

“I see greater technology. I see greater energy,” he said. “We’re not just going to be the same old Porter hospital.”

Now What?

Exactly what will become of the hospital proceeds remains to be seen. As stipulated in the purchase agreement, the county can’t touch the principal for at least five years in order to cover any lingering liabilities of the hospital, such as Medicare adjustments.

The cash payment by CHS is expected to end up at around $88 million. Also to be turned over to the county will be the hospital investment accounts, after debts and bond payments are deducted. According to Hospital Chief Financial Officer Cheryl Harmon, current investments stand at $49 million with an additional $17 million in a money market account. After deducting liabilities, the remaining balance stands at $120 million.

Two council members addressed the proceeds. Bucko said he feels strongly that the principal should be preserved, and only the earnings spent. Burge, on the other hand, called for the proceeds to be spent in four areas: Health care programs, both mental and physical; economic development; pay-off of county government debts; and infrastructure.

Posted 4/25/2007