Portage County commissioners voted Nov. 8 to approve a lease agreement leading to Robinson Memorial Hospital’s change of status from county-owned to not-for-profit.
Commissioners approved the conversion to non-profit status on March 13, subject to negotiation of the lease agreement between the county and a new corporation that will operate the hospital.
While the agreement is effective immediately, the final change isn’t expected to take place until the middle of next year. Stephen Colecchi, the hospital’s president and chief executive officer, said the hospital cannot start operating as a not-for-profit until the IRS approves the hospital’s tax exempt application.
“We have targeted on or about July 1, 2013. So, until then we will continue to operate as a county-owned hospital,” Colecchi said.
The vote was 2-1 with Commissioners Chris Smeiles and Maureen Frederick voting for it and Tommie Jo Marsilio against.
Marsilio said she’s against a clause which allows the new board “absolute right” the purchase the hospital.
“If we accept at face value that we don’t need to sell the hospital, that we only need to lease it, why is it so important the final agreement include an option for them to sell it?” she asked, rhetorically.
She also wanted a rule in place that would create “some socioeconomic and geographic” variety on the board to better reflect the community.
The lease agreement includes an annual payment of $50,000 to the county. The agreement also specifies that county commissioners must approve, by resolution, if the new operating corporation wants to exercise its option to purchase the 150-bed hospital.
The hospital board of trustees first proposed the conversion in August 2011.
“This is a very significant day in the history of Robinson Memorial Hospital,” said Colecchi. “The conversion to not-for-profit status will provide the hospital with the best opportunity to maintain its long term financial viability while continuing to meet the healthcare needs of the residents of Portage County and the surrounding communities.”
Colecchi said the new not-for-profit corporation has been formed under the name of Robinson Health System Inc. It will be governed by a 15-member board of directors. The initial board will consist of the 10 current members of the Robinson board of trustees and five new members.
The increase in numbers “will result in a broader community representation on the hospital board,” Colecchi said.