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Published on 12/25/1995 All articles from this issue

El Camino district board serves lawsuit to hospital management

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By Clyde Noel / Town Crier Staff Writer

The El Camino Hospital District board kept the pressure on Camino Healthcare management last week by serving administrators a lawsuit filed Oct. 30 over conflict of interest charges. The board also named Peter M. Pollock, a managed care critic, to the board, replacing a retiring Dale Brown.

In the meantime, Camino Healthcare board members held a roundtable discussion with local media to confront the district board's charges and more effectively convey their case for managed care.

Pollock, a non-practicing attorney from Palo Alto, said he could offer more to the board because of his closeness to the hospital and also as the husband of a physician who practices at El Camino Hospital. He said he understands the problems confronting the board, and he is one of the candidates who read the leasehold and the reasoning for the establishment of Camino Healthcare in 1992.

The district board's lawsuit alleges some involved in the dedistricting of the hospital in 1992 profited from the action. The suit resulted from pressure by disgruntled hospital workers, including physicians and nurses, who felt excluded from the new management system. Through the lawsuit, the district board is seeking to disband the current integrated delivery system (IDS) and return El Camino to an independent community hospital.

The litigation forced Camino Healthcare officials to repay $32 million last week on a $60 million short-term loan with Interstate Bank. The bank requested accelerated payment due to the lawsuit.

"We are very disappointed with the district board's decision to sue the Camino Healthcare community board, especially after our repeated attempts to resolve issues with district board members," said Doug Usher, chairman of the Camino Healthcare board. "I do not believe there were any conflicts of interest at the time of the district reorganization and I know that everyone involved in creating Camino Healthcare did so with public support to protect the future of El Camino Hospital. I feel this litigation is a waste of money that should be used for community health services."

District board members, led by Mark O'Connor and Paul Hoar, have been suspicious of the Camino Healthcare board, in part because members can make decisions in private meetings, thereby avoiding public accountability.

O'Connor complained to the state legislature's Assembly Committee on Judiciary during a Dec. 6 hearing on conversion of publicly funded hospital operations to private use. O'Connor said the 1992 dedistricting left approximately $100 million unaccounted for. He added the merging of the Sunnyvale Medical Clinic for $27 million in 1993 "worked out to approximately $350,000 per (clinic) physician."

Usher and fellow board member Jim Wilson labeled O'Connor's report "totally inaccurate."

In their media conference last Wednesday, Usher and Wilson said they are willing to work out a compromise solution with the district board. However, both said they would vote to return hospital management to the district board if that board continues to pursue litigation.

"If we can't come to any conclusion, I will vote to return the IDS back to the El Camino Hospital District Board," Usher said.

Officials describe Camino Healthcare as a public benefit corporation governed by six volunteer community members and three physicians who practice locally. Camino Healthcare, introduced in September 1994, resulted from the merging of El Camino Hospital with Camino Medical Group, a physician group made up of Sunnyvale and Shoreline medical clinics.