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Outlook brighter on hospital talks
by Jennifer Heldt Powell
Tuesday, March 5, 2002
CareGroup Inc. said it expects to reach a deal with a coalition that
wants to save Deaconess-Waltham Hospital, although a consultant said
yesterday that the facility has only a slim chance of survival.
The Hunter Group, hired by CareGroup to evaluate a plan by developer
Roy MacDowell and the Coalition to Save Waltham Hospital, said preserving
the money-losing facility will be difficult even with an infusion
of cash, a clinical partnership with New England Medical Center and
support from city and state officials.
"We recognize based on the information before us that it will take
an enormous amount of grit and effort to continue long-term operation
of Deaconess-Waltham," the two sides said in a statement released
late last night. "Nevertheless, we are persuaded by the determination
of the Coalition, and tonight the Deaconess-Waltham board has decided
to continue negotiations with the expectation of reaching an agreement
by the end of the week.''
The plan hinges on a commitment from MacDowell, owner of Boulder Capital,
to put up $8.5 million of his own money. In addition, New England
Medical Center wants to set up a clinical partnership with the hospital
that would help boost its revenue. The proposal is supported by a
coalition of hospital doctors, staff and community leaders.
CareGroup said earlier this year that it will close the hospital in
April because of huge losses. The hospital group said it is losing
more than $1million a month.
MacDowell said he would give CareGroup $2.5 million to cove its losses
while the coalition puts together a turnaround plan. He would also
give the hospital $6 million for operations. In exchange, MacDowell
would get the hospital's property. He plans to lease the facility
to the hospital's new managers and use the extra land for apartments.
The coalition also expects financial aid from the city and state.
The Hunter Group projected that under that plan the hospital will
still lose $10.6 million this year, $2.3 million in 2003 and $3 million
in 2004.
The consultant said if the decision is made to develop a turnaround
plan, the hospital has to improve its image. The hospital will also
save to recruit more doctors committed to admitting their patients
to the facility.
In addition, the hospital must have a local board of directors and
a management team supported by the board and medical staff.
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