A decision today could allow Catholic Healthcare West to assume ownership of Sequoia Hospital and would provide a funding plan for the $240 million retrofit and remodel of the hospital.
CHW took over management of Sequoia Hospital in 1996 to help bail the 57-year-old facility out of near-bankruptcy, said Michael Papalian, president of the physician staff at the hospital. Nonprofit Sequoia Health Services maintained ownership of the hospital; operations were overseen by the Sequoia Healthcare District.
The district’s board will vote today whether to invest $75 million of its own money toward the state-mandated retrofit, and whether to dissolve Sequoia Health Services and grant CHW ownership of the hospital, hospital CEO Glenna Vaskelis said.
Under the deal, SHS and CHW would also contribute $75 million each, while the remaining $15 million for the retrofit would be accumulated through fundraising.
CHW is assuming ownership now because the hospital renovations need to go forward, Vaskelis said.
"[CHW] felt they had to have ownership in order to take on that kind of financial obligation," Vaskelis said.
One pediatrician associated with Sequoia Hospital has opposed the deal, saying it should have undergone much more public scrutiny.
"This is taxpayer money and we have a huge stake in this deal," pediatric cardiologist Michael Griffin said.
However, most of Sequoia’s physicians are content to let CHW take ownership, Papalian said.
"In 1996 [when CHW took over], the hospital was in huge financial trouble. We’ve had 10 years to see what it would be like, and we’ve been pretty happy," Papalian said.
Construction on the hospital’s new parking garage broke ground this month, will officially get under way in December and is scheduled to finish in late 2008. After that, the hospital’s new pavilion and medical office building will be constructed, followed by a seismic retrofit of the existing hospital.
The project is scheduled to finish in 2012, Vaskelis said.
While the Sequoia Healthcare District is funded through taxpayer revenues, its contribution comes from money the district received from CHW in 1996 and set aside in an investment fund, board member Kathleen Kane said.
The Sequoia Healthcare District board meets today at 4 p.m. at Sequoia Hospital, 170 Alameda de las Pulgas in Redwood City.