Hillside hospital likely to be sold

Hillside could be sold by the end of June.

By WILLIAM K. ALCORN

VINDICATOR STAFF WRITER

YOUNGSTOWN — The sale of Hillside Rehabilitation Hospital in Howland Township, layoffs, and work rule changes for union employees at Northside Medical Center are moves Forum Health leaders say are needed to reduce debt and keep the hospital system alive long-term

Three parties, two local and one national, are “aggressively interested” in Hillside, said Lowell Johnson, Forum chief executive officer. He declined to name the people interested in Hillside, which has 300 employees.

A news conference was called by the hospital Thursday to discuss the report by The Chartis Group, a health-care consulting firm hired by the Ohio attorney general’s office in 2007 to study the hospital situation in the Mahoning Valley.

Johnson said the sale of Hillside, which he hoped would be ready for Forum Board of Trustees action by the end of June, would produce $10 million to $12 million in revenue. Forum announced Wednesday that it has a tentative agreement to sell its Forum Health at Home to Celtic Healthcare for between $3 million and $4 million.

Assuming both entities are sold, it would appear to go a long way toward Forum’s bringing its unfunded debt below the $100,000 level, which Johnson said is the goal for this calendar year.

He said the debt was $180 million when the financial turnaround effort began but has been reduced to $116 million.

Parry Hesselman, chairman of the Forum Board of Trustees, agrees with many of the conclusions drawn by the Chartis Group: Namely, that Forum is losing too many patients to other hospitals; that Forum has to negotiate better deals with its third-party insurance providers; and bring down operating costs, particularly at Northside, by negotiating work rule changes with its unions that would reduce premium costs.

Forum has asked Anthem, which buys 60 percent of all nongovernment health care at Forum, to help out, Johnson said. He estimated Forum could gain $2.5 million for the rest of this year and $5 million in 2009.

According to the Chartis Group, Trumbull Memorial Hospital in Warren is about $400,000 a year over the regional benchmark for adjusted cost per patient, while Northside is an estimated $15 million per year over the benchmark.

“We are not talking about lowering wages, which are about the same at Northside as other nurses in the area. But, there is big need to reduce premium pay costs,” Hesselman said.

Contracts with the Ohio Nurse Association Youngstown General Duty Nurse Association and the Service Employees International Union District 1199 at Northside expire July 19 and Sept. 30, respectively.

“We will know a lot more by the end of September” about the survivability of the health system. We need help from both unions,” Johnson said.

He said 62 cents of every $1 is spent on employee pay and benefits at Northside, compared to 49 cents at TMH and 48 cents at St. Elizabeth Health Center, Forum’s major competitor.

Layoffs at Northside are also part of the mix. Johnson said 49 positions in 15 departments have been targeted for elimination by the end of May, and more will come.

Though patient volume is down so far this year from what was projected for Northside, admissions at TMH are 200 over what was anticipated. As a consequence, no layoffs are expected there.

In fact, Johnson said he is hopeful that some of the people laid off at Northside will be hired at TMH.

To improve patient volume and stem the “out migration” of patients to other hospitals, Johnson said Forum intends to mount an information campaign to let people know Forum is still in business and, except for specific specialties such as neurosurgery, it is not necessary to travel to Cleveland or Pittsburgh or other hospitals for quality care.

Also, he said Forum intends to bring in four additional primary-care physicians and a specialist to Northside by July 1, and a combination of seven additional primary care doctors and specialists to TMH in the next few months in an attempt to attract more customers.

Admitting that spending more money on additional physicians is a gamble, Johnson said: “I’m not going to sit here and lose $1.5 million a month. There is no future if we don’t reach for it.”

Also, he said though Forum is not actively seeking buyers for its nonhospital facilities, one of which is Hillside, it will listen to offers of fair market value.

One thing in the Chartis report that neither the Forum board nor Humility of Mary Health Partners agree with is any thought of combining or mixing and matching Forum and Humility facilities.

“We want to correct the problems at Northside and move on. We think there is room for two hospital systems in the Mahoning Valley, and we believe people should have a choice,” Hesselman said.

alcorn@vindy.com