‘A voice of reason’

Decades of service help keep hospital independent

For 45 years, RoseMarie Reno has sought to ensure that Tri-City Medical Center in Oceanside, Calif., is a thriving, independent, publicly owned hospital. Reno, 83, was the director of nursing in the emergency department from 1967 to 1974, helping shepherd the ED’s expansion from two beds and three gurneys to 11 beds. Though she left the hospital’s payroll in the mid-1970s, she never cut ties to the facility. As a professor of nursing at MiraCosta College in Oceanside, she conducted hands-on clinical training at Tri-City. And since 1984, the area’s voters have repeatedly elected her to the hospital’s seven-member board of directors.

As a board member, she has backed numerous proposals to improve the hospital’s clinical capabilities, such as the addition of a Level 3 neonatal intensive-care unit and expansion of the emergency department, which now has 47 beds, including six reserved for fast-track patients.

“She has been a voice of reason on the board,” says Vista, Calif., Mayor Judy Ritter. The hospital, which has grown to 330 beds and has annual net revenue of about $400 million, serves north suburban San Diego County, including Vista, Oceanside and Carlsbad.

For her accomplishments, Reno has been selected as the Trustee of the Year for a large hospital.

Reno’s commitment was put to the test in 2008 when the hospital was beset with problems. Scripps Health purchased Sharp Mission Park, a 65-physician medical practice, which represented 30% of the hospital’s primary-care physicians. Meanwhile, the interest rate on the hospital’s $73.9 million bond debt, which was set at weekly auction, soared as high as 18% after the financial markets collapsed that year, costing the hospital more than $1 million a month. In addition, the hospital had not complied with California’s seismic safety standards.

Given the situation, some vocal members of the medical staff wanted the board to sell Tri-City to a private health system.

Not on Reno’s watch. At a meeting in December 2008, she convinced the board to put Tri-City’s eight-member executive team on administrative leave and launch an investigation into the hospital’s financial condition, Reno says.

“I felt that, by God, what have a got to lose? I am going to stick my neck out there, and I am going to pursue this to the end. I am going to save this hospital,” Reno recalls.

In January 2009, the board hired Larry Anderson as interim CEO, making his position permanent in July 2009. Meanwhile, Anderson—who formerly was president and founder of Integrated Healthcare Holdings, a four-hospital chain in Santa Ana, Calif.— fired the previous administrative team in April 2009. “There were major issues that should have been dealt with by the executive staff that were not dealt with,” Anderson says.

Anderson addressed the problems systematically, which led to a $16 million profit, or excess of revenue over expenses, in fiscal 2011, ended June 30, and an $8 million profit in fiscal 2012, up from a $5 million loss in 2009 and a $11.2 million loss in 2010.

The hospital refinanced its debt and now has a $51 million term note, which is secured by an equal amount of cash, and equipment leases totaling about $6 million.

It also has improved or added clinical programs to increase revenue. For example, the hospital and North County Health Services, a federally qualified health center with multiple locations, launched a midwifery program to increase the number of Medicaid births at the hospital, enabling it to qualify for Medicaid’s disproportionate-share program.

The hospital also embraced robotic surgery, purchasing four devices including two specifically designed for spinal procedures.

While it still has not recruited nearly enough primary-care physicians to replace those it lost in 2008, the hospital launched North Coast Medical Accountable Care Organization, which is participating in Medicare’s shared-savings program.

Tri-City also renovated its lobby, ER entrance and inpatient rooms and has nearly completed construction of a new medical office building.

Reno, who was board chair off-and-on during this period, ensured that board members were informed and involved in decisionmaking. For example, Reno put together a four-inch-thick binder packed with background information.

“She sits down with new board members and goes through it,” Anderson says. “I have never seen a trustee do the amount of work that she does. She loves the hospital. It is her life.”