Memorial board rejects HCA’s interest

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The Memorial Board of Trustees views HCA’s interest in purchasing Memorial Health System as the “wolf at the door,” said Chairwoman Arlene Patterson Stein.

“We speak as one voice, and we would like council to affirm its commitment to the commission’s work and it recommendation,” she said. “We don’t support the HCA attempt.”

The Memorial Citizens’ Commission spent nine months researching options for Memorial’s future. It recommended to the Colorado Springs City Council that the hospital become an independent nonprofit system.

In recent weeks, HCA reaffirmed its interest in purchasing the system, and asked for a new process that would allow it to participate. The commission did not entertain any offers from for-profit systems, but did explore the option with mergers-and-acquisition expert David Burik from Navigant Systems.

Stein made her comments at a joint city council-Memorial board meeting held today to discuss the details of a plan to create the independent nonprofit.

“The devil’s in the details,” said Councilman Sean Paige. “And we need those details if we want the voters’ support.”

Paige has raised questions this week about the commission’s decision-making process, suggesting the commission was led to the nonprofit choice by Memorial’s administration.

Jim Moore, vice chair of the Memorial Board, brought up the doubts in the community that the council was committed to moving ahead with the commission’s proposal. He asked the council to vote on the recommendation to erase all the doubt.

Mayor Lionel Rivera agreed that the city council would put a resolution on the agenda for its next council meeting.

“We could pass a resolution, but that’s not going to stop doubters in the community,” he said. “And it won’t stop some outside entity from pouring money into the election, and trying to defeat it.”

He suggested a task force to discuss the major issues – creation of a new nonprofit corporation, defeasance of bonds, revenue commitments from Memorial to the city. Once that task force completes its work, Rivera said that would be the time to discuss a resolution. The task force will be made up of three city council members, three Memorial board members, as well as representatives from Memorial. Commission consultant Larry Singer will also be a part of the discussions.

Another big issue is PERA, the state employees’ retirement plan. At this point, there is no information about how employees could be switched to another plan. Memorial employees cannot stay in the retirement plan once the city no longer owns the hospital. PERA has indicated that it will be mid-January before they can advise the city about how to proceed.

“To give you a little bit of comfort, the actuary doing this is PERA’s actuary, so they have all the data,” said Pat Kelly, city attorney. “We’ll have that answer well in advance of the election.”

PERA will give a calculation of the unfunded liability and the amount needed to move employees to a new retirement plan.

“There’s so much uncertainty around this, it’s important to know that the board is committed to what’s best for employees,” said Memorial board member Vic Andrews.

Paige suggested there wasn’t enough time to discuss the issues and put it on a ballot.

“I’m concerned about the timeline,” he said. “I see a lot of potential problems.”

Rivera said that he could always call a special meeting in February, if needed, to iron out final details.