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Coalinga Regional Medical Center image via Wayne Allen

published on June 7, 2018 - 11:45 AM
Written by David Castellon

Wayne Allen came to Coalinga Regional Medical Center about two months ago charged with trying to keep the financially troubled facility open.

But at first, it seemed Allen was brought in as CEO too late, and within a few weeks he announced in early May Coalinga Regional was closing its emergency room and not taking new patients, and by June 15 the small, rural hospital would close completely.

But Allen, a former hospital industry executive who these days specializes as a sort of hired gun with the financial skills to turn around troubled hospitals, kept on working to keep the doors open in Coalinga.

In an interview this week, he said he’s hoping to finalize soon a deal to get the hospital back on its feet and avoid the June 15 closure.

“I did put it in a closure mode, but we worked out a management-services agreement with an outside company, and we are in the process of reopening,” Allen said.

Essentially, that agreement would have the hospital run by a private group, American Advanced Management out of Modesto, which owns and runs hospitals in Modesto and Colusa and manages one in Willows.

Allen said he would stay on as CEO, possibly for a few months during the transition, and then resign and return home to Reno.

AAM will have a lot of work to do, getting Coalinga out of $4.5 million in debt, due largely to declining patient admittance, said Allen, noting a trend in the hospital industry of some non-critical patients being admitted less and instead being treated at outpatient facilities.

“It did not respond to changing business considerations,” causing the hospital to fall deep into the red, said Allen, who didn’t elaborate further on the hospital’s financial problems.

He also didn’t say how the new management team intends to turn things around.

But before AAM can do anything, the management contract first has to be approved by the California Department of Public Health, which Allen said he hopes will happen within a couple of weeks.

If it is approved, the hospital will not be able to get fully up and running right away.

With the May partial closure, 100 employees were terminated while about 75 stayed on to care for about 50 patients in the hospital’s skilled care division — as acute care patients were sent to other facilities — and to provide ongoing outpatient care for some people.

Allen said the process of rehiring staff that want to come back and possibly hiring replacements for those who don’t, along with getting closed departments up and running again, could take 45 to 60 days.

Getting Coalinga Regional fully running is critical for the community, said Allen, as the city had a population of 16,766, as of the last U.S. Census estimate, and the population within the hospital’s health district numbers more than 35,000, Allen said.

From Coalinga, the nearest other hospital and emergency room is in Hanford, about an hour’s drive, while the second nearest, in Fresno, is about and hour-and-15-minute drive.

“It is a compromising situation,” having the nearest hospitals so far away, Allen said. “It puts people in jeopardy” and increased the risk of people dying due to serious injuries and illnesses.


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