COLORADO SPRINGS, COLO. -- After months of research and discussion, a citizen's commission recommended to city council that Memorial Hospital be changed into a 501(c)3 not-for-profit model.
That suggestion was supposed to be put on the ballot in April for voters to decide on, but now placing the measure on the ballot is being pushed back.
The decision to hold off placing the measure on the ballot came about after members of an advocacy group found that a lot of the community wasn't clear about what changing Memorial into a nonprofit meant for them.
"In the course of the last few weeks members of the board members of a new advocacy group have talked to community leaders and other people in the community, and the feedback is that there is a lot of misunderstanding, confusion, not quite understanding what this is all about, and as a result many people were inclined to go ahead and just vote 'stay as it is' without fully understanding what the implications of that are and what the potential benefits of a 501(c)3 are," James Moore said.
Moore is the Vice Chairman of the Board of Trustees at Memorial Health System and a member of the Mayor's Task Force on Ownership and Governance for Memorial Health System. He said he and the rest of the Board of Trustees at Memorial believe that making the hospital into a nonprofit is the way to go, but they want to make sure the voters know that too.
"We're seeing online communications, we're having conversations with neighbors and friends, in addition to people who are considered leaders in the community, and the overwhelming message that we get back from all of them is that we're not quite sure we understand why this is gonna benefit us and why it's important to do it now," Moore said. "Those are both very important questions, and they have a lot to do with a changing environment for health care nationally and a desire to be able to provide the community better health care at lower cost, and we think we can generate new jobs across the community, not just in the hospital but in other areas."
He said another delay in putting the measure on the ballot is the city's obligation to the hospital's employees through their retirement program known as Public Employees Retirement Association (PERA).
"The obligation with regard to PERA, according to what they've told us is $217 million. There's an additional $28 million that is associated with a health trust and so the total number is $245 million," Moore said.
He said that number is roughly 10 times higher than they originally calculated.
"So it's a big number that really kind of needs to be worked over time," Moore said.
Moore said by delaying the ballot measure, they may be able to reduce that number.
"We have our own independent actuary whose gonna reanalyze the data, as well as the fact that that calculation as I understand it is based upon an end-of-year 2009 evaluation of the investments that PERA has, and we know that 2010 was a pretty good year in the market," Moore said.
Moore insists that regardless of what happens to Memorial, its employees won't suffer.
"We're optimistic, and what's important here is the Board of Trustees and the administration of the hospital are committed to making sure that our employees are not damaged or hurt by this," Moore said. "In fact, however, this works out that those employees who are vested, those employees who have been involved with PERA, will receive the full benefit that they're supposed to receive."
He said the Board of Trustees is 100 percent behind the commission's recommendation, and that making Memorial a nonprofit is in the best interest of the community.
"The difference would be imperceptible initially," Moore said. "I mean the day that it would become a 501(c)3, no longer city owned, patients would experience exactly the same relationships with their physicians, the nurses. The quality care that our nursing staff and our technicians are providing will continue, so it really is just taking away the city oversight of the city council which is, they're not specialists in studying health care, and also taking away the risk to the community that is posed by current indebtedness, and unknowns in the future of health care environment."
He said the measure could go on the ballot in November, but that will be up to the new city council.
"Bottom line with the 501(c)3 is quite frankly better health care with better opportunities for our employees and better opportunities for jobs across the community and lower costs in a better community overall," Moore said.
A majority of the current city council members agree with the commission's recommendation, but some, such as Sean Paige, said they would like the voters to have more options.
Paige said he is glad the ballot measure has been delayed, and he would still like the city to go out and solicit other options for Memorial, such as selling or finding a partner.
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