Santa Paula Hospital Closes ER

Failing Santa Paula Memorial Hospital shut down its emergency room Thursday as its top officials prepared to meet with Ventura County supervisors one last time to cut a deal to save the medical center.

The closure of the only emergency room between Ventura and Santa Clarita came eight days before hospital trustees had planned. The state Department of Health Services ordered the move because the hospital no longer had an intensive care unit.

“This is truly a sad day for Santa Paula and the people of the Santa Clara Valley,” said Supervisor Kathy Long, whose district includes the region. “I didn’t think things were so critical that they would go down so fast.”

Earlier this week hospital officials announced that they would suspend most medical services, including the trauma unit, at the tiny 42-year-old medical center next week. But on Thursday, the hospital and county said they wanted to try once more to craft an agreement.

The parties will meet Tuesday to discuss a key sticking point: control of the 18 acres surrounding the hospital and owned by it. The county has insisted that control of the acreage, in addition to the seven-acre hospital site, be turned over to protect taxpayers against possible losses after a takeover by the county.

“We continue to explore possibilities with the hospital, and I hope we are successful,” county chief administrator Johnny Johnston said. “But I am not willing for the taxpayers to assume that liability if we don’t have maximum security. It’s a deal-breaker.”

Even if the hospital agreed to cede control of the entire 25-acre hilltop hospital property, a second obstacle would remain if an audit due for completion soon revealed losses and debts greater than estimated by the hospital, Johnston said.

“At this point, we still do not have enough financial information,” he said. “Sometimes the truth will set us free and sometimes the truth says no deal. So first we have to get the facts. And right now it sounds like everybody is still trying to do that.”

But Long and fellow Supervisor John Flynn said they still hoped to save the beloved community hospital, which serves the communities of Santa Paula, Fillmore and Piru. The hospital is one of only three in the state built solely with community donations and without construction debt.

Long said the county would try to persuade hospital trustees that they have no other choice but to partner with the county -- or close.

“I fully intend to proceed with some sort of negotiations for restructuring the hospital,” Long said after meeting with state Health Department officials. “By Monday, we should know what the financial picture is and then we can find some solutions.”

At the same time, Flynn said talks with doctors and nurses at the hospital Thursday convinced him that the medical center must remain open, because it is essential to the health and safety of 50,000 Santa Clara Valley residents. “I’m voting to keep the hospital open,” Flynn said. “Then a way can be found to do it. You can negotiate anything. But the first commitment should be to keep the service going.”

If the hospital closed, too many people would be threatened, he said. As of Thursday, 10 patients remained registered at the 49-bed medical center.

“The whole hospital looks like it’s necessary to me and the emergency room is absolutely essential. They get accident and gunshot victims all the time, and Ventura is too far away,” Flynn said. “It’s a safety issue and moral issue.”

In the long term, he said members of the hospital board want to work with the county and the city of Santa Paula to build a replacement hospital as part of a new civic center along California 126.

Hospital board Chairman Phil Romney said Tuesday’s meeting could be decisive, since about 400 creditors were waiting to see whether an agreement was possible. Despite the hospital’s desperate financial position, Romney insisted it still had some negotiating leverage because the county’s health-care system could strengthen its position in the fast-growing Santa Clara Valley by operating the Santa Paula hospital.

“The greatest opportunity for growth in Ventura County in the future is in the Santa Clara Valley,” he said. “The county knows that and we know that.”

If the supervisors abandon the takeover talks, then the hospital could face bankruptcy, depending on how aggressive its creditors are, Romney said.

“There’s always the possibility that we could structure an agreement with creditors on how they’re going to be paid outside of [bankruptcy] reorganization,” he said.

The hospital owes about $7 million, including about $2 million in obligations to its retirement plan. Its assets are primarily the hospital site, appraised at about $15 million. The hospital has not turned an operating profit since 1988, and has been losing about $3 million annually in recent years.

Meanwhile, top hospital administrators met Thursday with state Department of Health Services officials to determine the hospital’s ability to operate in the future.

As of next Friday, nursing director Karin Lyders said Santa Paula Memorial’s license would be suspended by the state for a year with an option to renew the suspension for up to three years. She said the hospital’s 200 employees have not yet been given 30-day notices of termination but would be soon.

Former trustee Ernest Carlson, who served on the hospital board for 14 years and is one of the medical center’s founding physicians, said he believed the board had run out of time and money.

“I hope they get back together,” he said. “But in order to do this, they have to have the blessing of the Board of Supervisors.”