Kern County supervisors have started a process that could turn control of troubled Kern Medical Center over to an independent hospital authority, and on Wednesday got help from a state Assembly committee.
Supervisors say the county hospital can operate more efficiently -- and profitably -- outside of the county bureaucracy.
They voted unanimously Tuesday to take the first step in creating an authority and support passage of Assembly Bill 2546, by Assemblyman Rudy Salas, D-Bakersfield.
The legislation would give supervisors the power to create the authority and disentangle themselves from the financial millstone KMC has become.
On Wednesday, the Assembly Local Government Committee approved Salas' bill on a 9-0 vote and moved it to the Assembly floor.
Estimates say Kern Medical Center will have posted a $30 million annual loss by June 30, triggering a wave of fiscal belt-tightening that will slash services across most other county departments in the coming year.
Layoffs at KMC are likely in the near future, officials said last week.
Supervisors want to end the fiscal risk to the county budget while still ensuring KMC, a key safety net hospital and the only trauma center between Los Angeles and Fresno, stays open.
"The Board of Supervisors is doing everything in our power to save this hospital," said Supervisor Leticia Perez.
And, at least for now, it seems the county has the support of the Kern County chapter of the Service Employees' International Union, Local 521.
"SEIU 521 members are exploring many creative ways to ensure KMC transforms to become a public hospital of first choice for our community," wrote chapter President Regina Kane in a statement.
"One option is a hospital authority, as laid out in AB 2546. We are working with Assembly member Salas to ensure this bill would strengthen KMC by protecting workers while at the same time increasing KMC's ability to compete and improve the quality of services to the community."
Perez said the hospital authority could free KMC from bureaucratic entanglements that make it slow and ponderous.
She pointed to the county's civil service commission, which governs job classifications and hiring and firing decisions for the county.
"We have a very cumbersome, 1950s model," Perez said. "It can take us sometimes months to hire a nurse where other hospitals can hire a nurse in a matter of days or weeks."
Supervisor Zack Scrivner echoed the thought.
"The county believes that this authority may allow the hospital to operate in an environment that provides for more rapid and fluid business decisions related to staffing and procurement," he wrote in a statement. "Without some of the bureaucratic burdens of the county, KMC may be able to more quickly adopt and maintain profit-making strategies."
The exact details of the authority still need to be worked out. That includes the relationship between the county and the authority and whether all of KMC's assets and liabilities would be transfered to the authority.
"As currently being considered, the authority would continue to be either directly or indirectly governed by the Board of Supervisors," Scrivner said.
And, he said, the bill does not force supervisors to create the authority -- it simply gives them the power to do so.
Salas said the bill grew out of meetings involving him, KMC management, the supervisors and SEIU a couple months ago that explored the hospital authority model -- a tool other counties have used to solve problems with their public hospitals.
The bill is far from being signed into law, he said, and will likely be revised before it passes. But everyone is trying to craft a bill that satisfies all parties, he said.
"We're trying to save the hospital," Salas said.
UNIONS VERY INVOLVED
Under Salas' legislation, KMC's staff would be employed by the authority, not the county.
Perez said the county and SEIU, its largest employee union, have been working closely to find ways to transform aspects of KMC's governing structure to make it more nimble and competitive in the modern hospital marketplace.
She said the legislation won't pass without the support of SEIU and its influence in Sacramento.
"I do not believe we can move in the direction we would like to go without SEIU on board," Perez said.
Perez said supervisors want to save as many jobs as they can but they cannot afford to lose KMC. She said it is critical for the union to have a seat at the table as these decisions are made.
Employees' "champions are at the table so no person's interests are left out," she said.
Kane argues that the county and the union need to focus on the long-term success of Kern Medical Center -- not just the current financial crisis.
"We believe Kern Medical Center should be here for the next generation," Kane, a KMC mental health nurse, wrote, "and we all need to come together and think through the best strategies to preserve and strengthen KMC long after the budget needs of 2014 have been addressed."