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Published on 12/11/1995 All articles from this issue

El Camino Hospital's Camino Healthcare system shows $8.4 million loss

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By Clyde Noel / Town Crier Staff Writer

An independent audit has revealed an $8.4 million net loss for the system during the 1994-1995 fiscal year (FY) audit, officials revealed last week.

The Pete Marwick auditing firm was retained after lengthy discussion at the El Camino Hospital District Board meeting June 29. Board member Mark O'Connor had expressed conflict-of-interest concerns relating to the district and the hospital using the same auditors.

The board determined that two audits were required. The first audit was a fiscal year-end financial report by Marwick and the second audit is an audit of the performance to the lease covenants to be completed within six months of the fiscal year-end, June 30. That audit was assigned to Bryan Polster of Frank, Rimmerman & Co., and has not been completed.

"The Camino Healthcare losses are symptomatic of an increasingly competitive health care industry," said Doug Usher, chairman of the Camino Healthcare Board of Directors. "The plan is to bring Camino Healthcare's income in line with expenses within two years while maintaining quality health care services for the community."

According to John Reiber, senior vice president and chief financial officer, Camino Healthcare is starting the new fiscal year budget in better shape. He said the current budget is designed to reduce the organization's losses from last fiscal year's losses of $8.4 million to $2.5 million in 1995-96.

"To date, the first quarter net loss is better than budget, due to a 10 percent increase in hospital-based business and a 15 percent increase in physician office visits," Reiber said.

Operations at El Camino Hospital continue to receive good ratings from outside accreditors, despite a lawsuit served by the hospital district against Camino Healthcare management and the contentious atmosphere by factions of doctors at the hospital.

said "Our quality of care, as judged by the two hospital report cards we received from outside regulators and payers in the past several months, continues to be scored as excellent," said Gerry Sarnat, M.D., Camino Healthcare chief medical officer and interim president, and chief executive officer.

"The Joint Commission on Accreditation of Health Care Organizations gave us top accreditation status, and last week Blue Cross/California Care reported an excellent overall hospital score with maximum points for patient satisfaction," he said.

In the most recent internal hospital patient satisfaction survey, the hospital scored a 9.52 out of a scale of 10, reportedly the highest ever.

"As we continue to make these changes, it is extremely important to us that our patients remain pleased with the care they receive," Sarnat said.

The Camino Healthcare is a nonprofit public benefit corporation governed by six volunteer community members and three physicians who practice in the community. Camino Healthcare was formed in September 1994 by joining the El Camino Hospital with the Camino Medical Group which are a physician group made up of Sunnyvale Medical Clinic and Shoreline Medical Group members.

The El Camino Hospital Board of Directors is an elected five-person board that presently is made up of two doctors and two lay persons. A vacancy exists on the board at present.

The elected District Board served a lawsuit last month against Camino Healthcare, claiming conflict of interest in the lease covenants and requesting documents from Camino Healthcare at a joint meeting of board representatives held Tuesday. If the documents are not delivered, board members said they would pursue the lawsuit in county Superior Court.