The outrageous and disruptive antics of the 397-bed Tri-City Healthcare District's elected board in Oceanside, CA are nationally known. They tell a cautionary tale about why it's a bad idea to let voters choose who governs a hospital.
Tri-City has "become kind of notorious or infamous around the country with those of us who practice in the field of governance for not-for-profit organizations," said Ed Kazemek, founder and chairman of Accord Limited of Chicago, a healthcare governance consulting firm.
Take, for example, these excerpts from last Friday's San Diego County Grand Jury report on Tri-City, entitled "Dysfunction Run Amok."
"Board meetings are conducted in an unprofessional and disruptive manner. A board member routinely manipulates the proceedings and intimidates other members," the report notes.
"This member has been censured by the Board six times since mid-2010. Meetings feature heated arguments and occasional name-calling. A board member routinely questions items on the agenda, focuses on the minutiae of administrative operations and monopolizes meeting time with time-consuming, unproductive, or irrelevant discussions."
The report goes on to describe the district's serious financial problems "due to poor investment returns, unorthodox financial reporting by the Medical Center's previous management team (who were removed by the board in December 2008) and the alleged failure of an outside auditor to follow generally accepted accounting procedures." Those resulted in a $10.5 million loss in June 2010 atop an $18.5 million loss in fiscal 2009.
Is this any way to run a hospital with 161,000 patient encounters a year in a 500,000-population service area?
In 2009, another county Grand Jury with different members issued a similar report and concluded the board's "model of governance appears to be a hindrance." It suggested the board find another model of governance, which the board rejected.
Tri-City's seven board members are elected by residents of the district to four-year terms with no term limits, a situation that makes those members especially tough to train for proper governance, Kazemek says.
That's because they often "confuse their job and their role with representing their constituents, much like a politician. A board member's principal duty is to fall on the sword for the hospital, and not do anything to harm the hospital, not only financially, and for quality, but also reputationally."
Though there are many high-quality elected boards out there, he says, "Frankly, I don't recommend that [hospitals] have an elected board."
James Orlikoff, senior consultant to the Center for Healthcare Governance and National Advisor on Governance and Leadership of the American Hospital Association in Chicago, also knows about Tri-City's dysfunction. But these elected boards are often stuck, "because they can't select their members nor can they remove them. They're the worst model of management that exists, and they're impossible to change," he says.
Of the 5,000 hospitals in the country, Orlikoff says, about 1,000 are public, district, or county hospitals and of those, 200 have elected boards. And for far too many, he says, board meetings often resemble "what amounts to a clown show."
I asked the Joint Commission whether anything in the Grand Jury's two reports might indicate a violation of commission standards and prompt an accreditation survey or investigation.
Spokeswoman Elizabeth Zhani produced the agency's Jan. 1, 2009 leadership standard, which prohibits "disruptive and inappropriate behavior" that "undermines a culture of safety." Zhani said late Wednesday that the commission has now gotten involved. "We received a complaint related to the hospital's leadership standards and are working with the organization at the time."
Hospitals must develop and implement policies and procedures that address "zero tolerance for intimidating and/or disruptive behaviors, especially the most egregious instances of disruptive behavior such as assault and other criminal acts," And that applies to hospital leaders, including board members.
Does the board culture impede quality of care? Does it mean the hospital is constrained to provide less than it could? I'd say certainly, at some level, that has to be the case.
Board member and former chairman Larry Schallock acknowledges that this behavior has hurt the hospital's business profile. Recently, the hospital took a pounding when a 64-physician practice jumped ship to affiliate with Scripps Health hospitals, even though it meant a 20-mile + drive for doctors and their patients, he says.
Scripps and Palomar Pomerado Health, another district hospital 22 miles away, "are all looking for additional patients, and it's extremely competitive. It's real hard in this competitive market to be free-standing and survive," Schallock says.
State health officials imposed two immediate jeopardy monetary penalties on Tri-City hospital for endangering patients in 2009 and 2010. And last year, the state levied $130,000 in fines against Tri-City, the greatest amount of any hospital in the state, for delayed reporting of several adverse events. That's $100 per day for every day after five the event goes unreported.
The board's own CEO, Larry Anderson, too, has been at the center of board disputes; he was fired but then re-instated in the same week by the fractious board last year. Tri-City is now making money, and has a decent census.
But these reports tell only part of this difficult story. Public documents and news stories say the board member at the center of the fracas faces felony vote-swapping charges filed by the county District Attorney, to which she pled not guilty in December.
A restraining order bars her from entering the hospital and a civil suit wants her to pay $100,000 in damages for allegedly causing harm to the hospital's reputation, battery on security guards, and trespassing, documents and press reports say.
Now that board member participates in meetings only by telephone from a separate building in the parking lot. Hospital personnel say they now fear for their personal safety, according to one news account.
But the antics continue. News reports say the board member in question has retaliated against fellow board members by calling them "Nazis," and district employees "dangerous" and "thugs." She proclaims her innocence, and says the accusations against her are "a ruthless and lawless effort to usurp the constituents [she] represents." (She did not respond to a request for comment.)
"It's so many crazy things," acknowledges Schallock, who notes that board members even called security guards on one occasion fearing that the board member might "have a gun."
"Most of the fighting is about petty stuff, but the petty stuff becomes big stuff," he says.
Last year, the board held a peacemaking meeting at a restaurant but the dinner "by all accounts, devolved into yelling and napkin throwing and drove away customers seated nearby," according to an August report in The San Diego Union-Tribune.
When asked for a comment, current board chairman RoseMarie Reno, a nurse who served on the board more than 25 years, replied, "There's an old saying, 'one bad apple spoils the bunch.' The board is taking the blame for the actions of one board member."
Who knows whether anything will quell these soap opera-like sagas. But I thought Kazemek summarized it best:
"It's embarrassing. It's certainly not helpful, and is hurtful to the reputation of the hospital, which impacts donor giving and philanthropic support, which in turn affects morale and the medical staff, and causes physicians to start thinking maybe I should take patients to another hospital."
There are a lot of disruptive board members on dysfunctional boards in elected hospital districts in the U.S., he says.
"But this one seems to be in the upper decile. It's a shame."