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SVMHS Steering Group Makes Affiliation Recommendation to Board of Directors

SALINAS, CA, July 26, 2012—The Salinas Valley Memorial Healthcare System (SVMHS) steering group studying affiliation today submitted its recommendation to the SVMHS Board of Directors. The voting members of the steering group voted unanimously to recommend that the board end the affiliation process. SVMHS had been considering a proposal from Natividad Medical Center (NMC) to merge the two public hospitals, and operate them out of a newly created Healthcare Authority.

“We very much appreciate the thoughtful proposal from Natividad Medical Center,” said Jim Gattis, president of the SVMHS Board and a member of the steering group. “We support the concept of working together for the betterment of healthcare in our region. While this particular proposal did not meet the needs of our organization at this point in time, we do believe that the future will require a community-wide collaborative effort to ensure quality healthcare in our region for years to come.”

Salinas Valley Memorial started exploring affiliation early last year as a way to address economic concerns and coming healthcare reform. “From the beginning, we knew affiliation would work only if we could find the right partner that could meet the needs of our organization,” said SVMHS board member Pat Egan, who also served on the steering group. “It is our recommendation that affiliation as we envisioned it should not happen at this time.”

If the board accepts the steering group recommendation and decides to end the affiliation process, the board will likely begin the process of hiring a permanent CEO and continue to operate as a stand-alone hospital while it addresses its cost structure issue.

While SVMHS achieves above-average clinical quality metrics, future sustainability will depend upon finding parity with other California hospitals in pay scales, medical fees, supplies and equipment expenses.

SVMHS leadership plans to initiate a collaborative effort to address the need for further operating cost reductions and pursuing revenue growth opportunities. “All key stakeholders will have a seat at the table as we work together on a local solution,” Gattis said. “We look forward to exploring the potential of a new, unprecedented collaboration in providing healthcare in Monterey County.”

Gattis concluded, “This board remains committed to providing quality healthcare for the residents of this District. This is an important community asset that delivers exceptional care and has been recognized on a national level for quality. With the support of our community, our outstanding medical staff and employees, we intend to find a way ensure that quality care is here for years to come.”


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