Steve Lund, President of the MCDH Board of Directors made a surprising statement after the Board of Directors voted to place a parcel tax measure on the June ballot.
If I heard this correctly, He says that the Board, last June, voted unanimously to make no cuts to programs or services and deliberately passed a budget with a deficit in order to make a point to the community about the need for a parcel tax.
This could be construed several ways. We know MCDH was bailed out last year by the Mendocino Coast Clinics Inc., who stepped in and helped to resolve the Obstetrics (OB) financial problems by offering more on call hours coverage by their OB physicians and Pediatricians. Mendocino Coast Clinics (MCC), as a Federally Qualified Health Center (FQHC) clinic, is able to save money because they have less expensive insurance coverage, lower salaries and benefits as well as a better rate for MediCal reimbursements.
That statement exemplifies the stale mentality and lack of vision of the existing Board of Directors. Make no attempt to solve a budget crisis because the voters wouldn’t approve a parcel tax if the hospital wasn’t in danger.
If you look at the comparison between the neighboring hospitals annual budgets and the timing of the passing of their parcel tax a distinct trend happens.
- They first pass a deficit budget and then begin making the case that the only way to recover from the deficit is to pass a parcel tax.
- The community falls for the scare and passes the parcel tax, believing it is the only way to keep their Healthcare facility from tragedy.
- The hospital immediately borrows against the parcel tax.
- The deficit never recovers and the hospital ends up in more debt after the tax, owing on the loan they took out against the collateral the parcel tax gives them.
- Neither of the other hospitals have recovered from their deficit, budget / loan scheme, running millions of dollars in the red.