Documents show KVHD knew of financial struggle: July 2010

As the buzz around the town has been about another cost to homeowners aside from a recent water rate increase, shocking electrical bills, a freeze on cost of living increases for those on fixed incomes, pension fund losses, propane, gasoline and food now comes another hand out: more property taxes to help the Kern Valley Healthcare District pay off the revenue bonds which cannot be bankrupted.

The KVHD administration has been talking about putting a general obligation bond on the ballot to pay off the debt, but what they haven't spoken about was they knew this was coming and waited for some now understood reason to act.

A GOB is not a new idea as you will see in the last document, it's been here many times before including Measure M in 2006.

Even Measure M as I mistakenly touted as completely necessary, was to be used to build an addition to the existing structure and utilize the depreciation to pay off what is called the "long term" debt.

The debt itself was a huge mistake on the part of possibly Goldman Sachs, but most assuredly on the hospital board of the time, which was 1985. Imagine this hospital putting out 22 million in bonds that can't be bankrupted and then they could not even finish the construction project this money was to be used for. The nursing center is half the size, so therefore, half the revenue projected.

Now they want 20 million from the community and they are somehow with less than the original debt, be able to pay off the first mistake and build a new ER and remodel an "imaging" center, which would be radiology.

But we have, according, to our CEO, Tim McGlew, and CFO, Chet Beedle no other options at this time.

Well, let's begin.

We knew a year ago January there were problems. I knew. But yet the person who is paid good money to keep this hospital functioning and safe, Beedle, for some odd reason didn't want to address the issue head on with our insurer.

After gathering support from KVHD chairwoman, Kathryn Knight, and Assemblywoman, Jean Fuller, to go to Cal Mtg. and simply ask what are our options, how can we solve these problems, can we defer payments, it was suddenly cancelled. (see email)

There was some bullying or as they like to call it here, politics, and nothing happened. No answers were given, no explanation provided.

Yet Beedle had 19 months to financially "manage" this hospital. Now the only solution that has been allowed to be discussed is the property taxes. A short message on bankruptcy was touched upon, and a parcel tax was considered, and there it ended: until now.

As I discussed in the previous blog (KVHD is not only hospital waivering) the problems with debt and spending are nothing new, but we heard some new excuses at the meeting which need to be addressed.

(click on documents to open, hit back button to close)

Millions of dollars have been lost out of the surgery department, salaries paid to a surgeon, nurses, and anesthetists, and what sorts of numbers do we see in this document: one, two and all the way up to five.

At the board meeting nobody, including the person in charge of the finances, CFO, Chet Beedle wanted to give a reasonable answer or explanation. They laughed basically and left it at that. (video coming soon)

Do you think those numbers are funny?

Look for yourselves.

Another issue came up regarding billings for co-payments from two years ago and financial manager, Beedle, answered by telling the community that by delaying their billings it was his effort to "help the community."

Old business is right, as you can see we have been talking about billing issues for a long time too, earlier than the document shows, I assure you.

But most know around town how bad the billing situation has been, they have been getting unknown bills. Accounts receivable is money you want to collect as soon as possible as people move or die or lose their jobs, and to say something as ludicrous as this was intentionally done to help the community only creates more of a rift between the hospital and it's voters for a bailout, AKA GOB.


And then there's the issue I'm still exploring as to why in January of 2009, the board knew there were serious problems, of course Beedle did too, but only one board member and one representative took the chance to try and address the problems that were already there. It was a meeting with the insurer of the large debt burden to try and find a way to stay afloat. (look under Cal Mtg. proposition)

If you're thinking right now that the insurer, Cal Mtg. in the Office of Statewide Health Planning and Development, should just pay our debt and that's it, then you need to understand that they don't do that. They are different. And we signed a wonderful contract binding the community's property to the debt.

There is no bankruptcy for the long term debt. Not that there couldn't be bargains, and negotiations by people who know how to do these things, not those who just say they can.

So we see clearly that decisions made with a board stamp, a consent agenda, have wrecked havoc on this district, and yet we are seeing nothing more than the same soup served up again and again for answers. It shows that time and care need to be taken especially at this particular time.

I would not be saying these things if there weren't sufficient evidence to "prove it" and the board had better prove it has been using due diligence when making decisions.

This new GOB has been thrown together like scrambled eggs and toast so far, much like they did in 2006, as the architectural plans were unfairly put forth on a "voting ballot" as usable. It turned out those plans were not even close to being able to come in within cost, but even more egregious, they were unusable and we paid good money to Aspen Street Architects for many years for nothing.


Final document, shows we have been here before, many times, but this is particularly interesting as this was during the time BRIM management who gave us both CFO Chet Beedle and former CEO, Pam Ott, that the insurer has on it's list of options, that GOB.

Now, here's the email I received saying there would be no meeting with the insurer as we don't have to do anything, and the board was looking into it. When has this board here and now, with one exception, Kay Knight, asked any hard questions about what we are doing?

They are our representatives in healthcare. They decided to run for the board. They took on the responsibility on their own accord.

All I have heard are parrots over there, and not people with time and effort to go through the process called, "due diligence."

(these emails were the end of the attempt to address a bad situation before it got worse to the point of a bail out, rather than upgrading services, arranging an urgent care, and looking at potential architectural plans. Look at the dates and times as Beedle, having been directly asked by chairwoman Kay Knight for a meeting, denies it in these emails below. It goes backwards, the time frame, so the initial statement is the cancellation. And note the board never did again address the problem. So what's the problem? )

This would not be a good time to vote on this proposal. We should allow it more time to accumulate more imput so the Board can give the decision an educated decision. Thank you for your input and your inspiration.
----- Original Message -----
From: Laura Hart
To: Beedle, Chet
Sent: Tuesday, March 10, 2009 12:57 PM
Subject: Re: Cal Mtg Proposal
Hello Chet:

Once the board votes to go into negotiations with Cal Mtg. then the proposal from KVHD would then, it would seem, be discussed and be more specifically written.

At this point, Cal Mtg. needs to get their people together and begin the process at their end. They know basically what this hospital needs to succeed and survive. And they know we don't have it.

And they have known this for a long time. I remember three years ago the hospital was purchasing a PAC system, for 80K. It was reconditioned, but what ever came of it? Now we're just dipping our toes into a digital radiology system.

Where is the true plan for expansion? What will it cost to keep up?

Which makes me wonder again, about the agency itself. From what I've read they are there to help keep rural hospitals growing and properly serving their respective communities.

One doctor who is currently under indictment, said that the ER is antiquated and he can't get doctors or staff to work up here.

And because of the looming indictments hanging over the hospital, with potential lawsuits, there is a sense of urgency to get this matter handled.

I'm assuming again that you yourself realize this.

Other issues of note that bring about urgency and fair play in this matter would be the needs of the hospital itself. The technology that you need. The structural repairs and additions. But more importantly a new plan for the skilled nursing facility.

Not just a note to public: it smells good in there. Nice murals. That doesn't work when people have died under suspicious circumstances. And these people live in this community. And these people are not getting complete medical records.

And local employees are being ignored by the largest employer in the valley.

We apparently have a truck load of rental nurses coming from Alabama or somewhere because of the staffing issues.

We can do better than this can't we? Or do you think this is the epitome of success for this hospital? I'm just wondering at this point.

Politics being played at this juncture will not help this hospital, the people and the valley. We have a reality to face and we need to do it. This is about elected officials, oversight agencies, the administration, and the public doing a good job. It's about new viewpoints, new avenues, new ideas, and new people.

This board needs to move forward, vote on the negotiations from this end, and Assemblywoman Fuller will then by order of the board begin the inroads for negotiations with Cal Mtg.

Other representatives of this valley, this district, the state can and will be utilized as well.

We need to learn from our mistakes and not hide from them; make things better by getting a clean start; and acting responsibly by taking action to get this done.

This is the first step.

And one of your employees, wrote on the Kern Valley Sun blog, that if people don't like the hospital they can drive down the canyon bleeding.

Another remark involved tearing down the hospital and creating an urgent care. Take a look it's coming from your management.

Is that helping our cause?

As far as the paperwork, there needs to be distribution of this material. I agree it is probably a mountain, but somehow, wouldn't it be quicker to scan this material into the computer so that it is easily accessed, rather than repeatedly making copies which would cost more?

Tell me we at least have that technology; I do.

Thank you again for your attentiveness to this matter. Let me know how you can make these documents available.

Laura Hart




----- Original Message -----
From: Beedle, Chet
To: Laura Hart

Sent: Tuesday, March 10, 2009 11:15 AM
Subject: RE: Cal Mtg Proposal
You are welcome for the response. I am not aware of any scheduled negotiations with Cal Mortgage. Relative to any current documents from Cal Mortgage, there are none since our last refinancing in 2003. Our original copy of that refinancing is in administration and Heidi can make you copies of the portion that you consider pertinent. The documents are very voluminous and it would help if you indicate to us those you consider necessary. We do not have these documents electronically, so they would have to be scanned or hard copies made.

-----Original Message-----

From: Laura Hart [mailto:hartofthekrv@msn.com]Sent: Monday, March 09, 2009 6:41 PM

To: Beedle, RE: Cal Mtg Proposal
Hello Chet:

Thank you for your response. I want to begin by saying the negotiations with Cal Mtg. will take place with what I understand, the board, yourself, Assemblywoman Fuller, and I have a private person in finance who will be overseeing the situation also.

All correspondence concerning these negotiations will go on to the Attorney General, Jerry Brown and Governor Schwarzenegger as well.

I will need all current documents regarding Cal mtg. and the most recent refinance for reference.

Copies will be sent to the other parties as well. You probably should email them to all of us involved.

xxxxx will be contacted shortly as to the intentions of following through on this proposal as well as adding other provisions as well as possible numbers which favor the hospital at this point.

They need to know they will not receive monies for at least two years. That's a definite. Our upgrades, with equipment, training, and construction will not allow for payments for at the very least two years. And any monies in the account deemed to go to Cal Mtg. will not at this point.

All the information I am receiving says we are on the side of doing what is appropriate with our bond and insurance situation.

Maybe the disparity between traveling nurses and community employees which is quite disproportionate at this point, can be rectified and mended with a new balance of monies.

I'm going to cc this letter to the board members so that they may stay in the loop on this matter.

As we both know there will be a serious cleansing process taking place to get the stains out of this district and upgrade the care and facility at the same time.

I repeat, thank you, for your support of this community. We need to hear more new voices and ideas from the valley itself.

God bless us, Chet, we need it.

Take care, Laura Hart