Friday, April 20, 2007

Is deal a rescue or an albatross?

Going it alone could backfire on Prince George’s

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Raphael Talisman⁄The Gazette
Nurse Terry Baker (from left) and emergency room techs Natashia Gibbs and Yardley Jackson rush their patient from a state police helicopter to the trauma center last Friday night at Prince George’s Hospital Center. The hospital center is safe for another year after a deal was worked out Wednesday night, but its long-term status is still uncertain.
ANNAPOLIS — Lawmakers, watching the to-and-fro of the Prince George’s County Hospital debate from a distance, say the County Council may be trying the state’s patience and jeopardizing Maryland’s willingness to rescue the cash-strapped medical center.

‘‘We’re not going to play referee for Prince George’s interfamily squabbles with the taxpayers’ dollars,” said Senate Minority Leader David R. Brinkley (R-Dist. 4) of New Market.

Taxpayer dollars could be hard to come by next year. State budget writers must make up a $1.5 billion shortfall and will be scouring the books looking for any reason to make cuts. The state might not be able to contribute $20 million — as Gov. Martin O’Malley (D) offered to help prop up the hospital.

On Wednesday, the board of directors for hospital operator Dimensions Healthcare accepted a county plan that buys 15 more months for the beleaguered hospital. Rejecting any participation by the state, the County Council pledged an unspecified amount to keep the hospital open.

The deal was offered Wednesday afternoon by County Executive Jack B. Johnson (D) and County Council Chairwoman Camille Exum (D-Dist. 7) of Seat Pleasant.

Johnson said Thursday he is waiting for Dimensions to tell him how much is needed, and a final number could be reached later. The county executive said the county would give the hospital system what it needs, although the amount would be negotiated.

State Health Secretary John M. Colmers, who helped negotiate the state plan, said he is relieved that the 180,000 patients who use Prince George’s Hospital have a facility for the next 15 months.

‘‘I am concerned, however, that some believe a deal that would provide more than 50-50 split, which was available on Sine Die, is likely to occur,” Colmers said.

And some lawmakers are uncertain that the county’s solution does anything more than postpone a day of reckoning.

‘‘It’s inevitable that they will be forced to come back,” Del. John L. Bohanan Jr. said of Prince George’s officials. ‘‘However, they’re going to have to make a very strong case, and it’s not going to be a slam-dunk approval. We had an offer on the table that was eventually rebuffed and the state’s fiscal picture is not improving.”

Bohanan (D-Dist. 29) of California serves on the House Appropriations Committee.

The framework of the state’s bailout was contained in legislation overwhelmingly passed by the House. Del. Tawanna P. Gaines (D-Dist. 22) of Berwyn Heights, another Appropriations Committee member, said it would be difficult for another bailout plan to pass in the legislature.

‘‘All of us in county need to be united in a solid plan that we can all buy into,” said Del. Doyle L. Niemann (D-Dist. 47) of Mount Rainier. ‘‘We’re going to have to come in and justify why Prince George’s County deserves money that other counties aren’t getting.”

Others said regional health care needs would trump any legislative reprisals.

‘‘It would be truly cutting off our nose to spite our face for us to say to the council, ‘You said no to us this year, we’re going to say no to you next year,’” said Sen. Richard S. Madaleno Jr. (D-Dist. 18) of Kensington.

Former senator Barbara A. Hoffman, now an Annapolis lobbyist, said the General Assembly will not walk away from its responsibilities at the hospital.

‘‘If the legislature didn’t balk at putting a Band-Aid for all those years, they’re not going to balk at fixing it once and for all,” she said.

To Sen. Ulysses Currie, chairman of the powerful Budget and Taxation Committee, the deal is a ‘‘placeholder.”

‘‘It allows us to get from where we are now to probably where we need to go with the hospital,” said Currie (D-Dist. 25) of Forestville.

House Minority Leader Anthony J. O’Donnell said more people would have to be involved in the hospital discussions during the 2008 session because of how the hospital’s troubles are being felt across the region. O’Malley’s budget, he said, hamstrings the legislature’s response.

‘‘Since we spent all the reserves this year, we’re not going to have the flexibility to resolve some of these issues with as much ease as we would have liked,” said O’Donnell (R-Dist. 29C) of Lusby.

Dimensions board Chairman Calvin Brown said the county’s plan should help calm some of the panic the hospital was hearing from its suppliers.

County officials did not say how much money would be provided under the plan. They are waiting for cash flow projections from Dimensions before making that call. They said the plan will buy them time to draft a long-term solution.

‘‘This is a very complex issue, and we should not rush to a quick solution,” Exum said.

Exum argued against earlier state offers because, she said, they could violate the county’s tax cap. But the county deal appears to mean the county will be paying out more than it would have under the state plan.

Had the county accepted the state’s deal on Sine Die, Prince George’s would have paid just $7.8 million to cover the hospital’s day-to-day needs through June 30, 2008. The state would have paid $17.6 million.

The state’s offer also would have had the county pay $25.1 million in capital costs over the 15 months. Maryland would have chipped in $13 million in capital costs.

Between March 2006 to June 2007, the hospital has sought $35 million to keep running.

Johnson spokesman John Erzen said he is unsure where the county money would come from, but said education and public safety money will probably not be jeopardized.

The hospital system has been on the brink of financial collapse for years, but many lawmakers, county officials and workers said this year’s game of political chicken was especially dangerous.

Quincey Gamble, political director for the Service Employees International Union local 1199, which represents hospital workers, said he approved of the plan, but said ‘‘it’s still only a short-term Band-Aid.”

‘‘It’s a good short-term plan. They should be applauded for that,” he said. ‘‘But I hope there’s no gap in the conversation [toward a long-term solution].”

Johnson said he plans to meet O’Malley to discuss a long-term solution. ‘‘We can’t continue to operate in crisis mode. We have to make some real critical decisions,” he said.

County and state officials had been in negotiating sessions through Tuesday night, trying to broker a deal with a County Council that seemed determined to reject any state offer regardless of any compromise.

‘‘Our desire is to save the hospital. ... It is not our desire to see the hospital close down and to have the former hospital be transformed into condos,” Gov. Martin O’Malley (D) said Wednesday morning.

The state wanted the county to hand over the management of the hospital to an independent seven-member authority. The authority was to have five members appointed by the governor, one by the county executive and one by the County Council.

But the council told the state Tuesday evening that it did not even want a representative on the authority, O’Malley said.

‘‘While this initially started off as a pursuit of what we thought was the shared goal of saving the hospital, our shared responsibility, [it] has instead started to go in the opposite direction the last few days,” the governor said. ‘‘You need a partner to have a partnership. And the council has yet to see its way clear to join us in that partnership.”

Del. Veronica L. Turner (D-Dist. 26) of Camp Springs said she expects the legislature to make another attempt at passing a long-term plan. ‘‘I really think it should come back. The authority is important,” said Turner, a nurse.

Around the state capital, some eyebrows rose at the thought that two members of the Dimensions board, Exum and Johnson Chief of Staff Michael Herman, helped to work out the final details of the deal with the county.

‘‘I’m not sure it’s a conflict of interest, but it doesn’t look right,” said Sean Dobson, deputy director of Progressive Maryland. ‘‘If part of the problem with the hospital has been poor management by Dimensions, it would be tough for Exum and Herman to crack the whip on Dimensions or sever the county’s relationship with Dimensions if they simultaneously serve on [the] Dimensions board.”

Like Gamble, Dobson considers the county’s plan for the hospital another Band-Aid.

‘‘The county needs to finalize a deal with the state — and Governor O’Malley’s offer is an excellent bargain for Prince George’s County,” he said.

Leading into the negotiations was news that Fitch Ratings of New York had downgraded $74.5 million in bonds Prince George’s had issued for Dimensions from ‘‘B-” to ‘‘CC.” B- indicates a significant risk, but a limited margin of safety remained. CC means default appears probable. Fitch blamed the downgrade, in part, on the failure of the county to reach an agreement with the state over the hospital.

Staff Writer Jason Flanagan contributed to this report.

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