A Resident's Take on the Los Alamitos Medical Center Revamp

Editor's Note: Richard Murphy is a long-time Los Alamitos resident, who first came to the city in 1964 and lived here about half that time. He is a commercial broker with Keller Williams. His opinions do not represent Patch.  In an effort to be a platform for community dialogue, Patch routinely welcomes opinion pieces from vocal and caring members of the community.  If you would like to share your opinions on community issues, please email me at paige.austin@patch.com

As I look at this proposed hospital expansion all I see are questions. I wonder:

 1. Why we are in such a rush to enter this deal with Tenet?

 2. Why we cannot have an honest  open discussion about this plan. Our council members could make time to  discuss the annexation of Rossmoor sometime in the future but cannot find time to have a workshop to discuss this pressing current  business?

 3 Why do we need to give Tenet a 25 year specific plan that has no guarantees other than another medical office building?

 4 Why we are putting Tenets desires above our own, in process, General Plan?

I am truly surprised that the majority members of the council do not see the political possibilities available to them. Other than the traffic issue, most of the complaints I have heard are about the timing of the Plan and  the lack of guarantees or penalties. No one is against the hospital getting better or expanding. This is a chance to bring the divided factions of this city together, listen to the individual concerns, and work out an agreement that all citizens can agree to. This should be easy.

In his presentation to Rossmoor Mayor Pro Tem Edgar said that the Council’s main responsibility was to protect the citizens of Los Alamitos. I agree 100 percent. I am compelled to ask: Where are the protections in this Plan? As it stands, we are going to give Tenet preference over our own General Plan. This is unconscionable as well as short sighted. Why would we or any city do this?

Lets take a look at Tenet.

Tenet is being actively pursued as a takeover candidate by Community Health Systems, so there is a real possibility they will be sold in the near future. Why can't we wait to see whom we are dealing with? 

In reading their 10 K and financial statements, I see a Company with a long history of legal troubles including a $900,000,000 settlement for Medicare over billing spread over 10 years and a $130,000,000 settlement for violations of the Americans with Disabilities Act. They are also "defending various allegations that they are in violation of Federal labor laws."

 On Page 19 of the 10 K, Tenet says " We are a highly leveraged company"  with over $4.3 Billion in long term debt. They go on to say that " Our leverage and debt service obligations could have important consequences to an investor including"  deterioration in our business and " we may have difficulty obtaining additional financing at economically acceptable interest rates". This at a time when interest rates are at historic lows and most experts agree that interest rates can only go up.

For comparison purposes: Tenet's debt is 91.23% of their assets. Possible acquirer Community Health only has 66% debt against assets. Why would we give any company like this the keys to the vault?

So, for all the heart-string-tugging about improving our little hospital, lets not forget that Tenet is the 253 largest public company in the USA. This is BIG BIG Business.

Only the future will tell if the problems stated above come to fruition. Unfortunately, we only have to go back seven years in the history of Los Al to find the last time that Tenet stood before the City and asked to build an office building and a parking lot. Then, as now,  no guarantees were secured. Tenet built the profit making office building but failed to build the costly parking structure as promised.

In her presentation to the Planning Commission Tenets president cited 4 reasons why Tenet may not or may choose not to continue the specific plan. The four did not include the pending sale or Tenets over leveraged financial position. Why would we put ourselves in a position where we cannot protect ourselves?

Final Question. How can anyone possibly vote for this plan as currently presented?