63-86 Transfer from Board of Trustees to Hosp. Association

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Please substitute for Ordinance 63-86 placed on First Reading on November 17 1986 and on Second Reading o November 24, 1986. ORDINANCE NO. 62-86; BY: Brown, Chinnock, Gallagher, McBride, Salmon, Wendling AN ORDINANCE approving transfer of the operation, management and assets of Lakewood Wospital from the Board of Trustees of Lakewood Hospital to Lakewood Hospital Association; authorizing the executio~ and delivery of a Lease between the City of Lakewood and Lakewood Hospital Association; approving and authorizing related matters. WHEREAS, the City of Lakewood, Ohio (the "City") owns certain real and personal property comprising hospital facilities known as Lakewood Hospital and related facilities and property located in the City (the "Facilities"), which are managed and operated by the Board of Trustees of Lakewood Hospital (the "Hospital Trustees") under the authority of Article XX of the Charter of this City; and WHEREAS, the electorate of this City at the general election held on November 5, 1985 adopted an amendment to the Charter of this City authorizing the lease of Lakewood Hospital to a nonsectarian Ohio non-profit corporation organized for charitable purposes and pursuant thereto the form of that lease has been prepared and is attached to this Ordinance and incorporated herein as if fully set forth in this Ordinance; and WHEREAS, Lakewood HOspital has operated on a self-sustaining basis without any operating subsidy from this City, and has established a reputation for providing quality hospital care to all residents of this City, without regard to their ability to pay for such services; and WHEREAS, there have been, and continue to be, significant changes in the health care industry, including: changes 'in the method and amounts of payments to hospitals and physicians for health care services; increased competition for patients among hospitals and alternative health care delivery systems; reductions in patient days and revenues due to utilization review pressures; aggressive efforts by business coalitions to limit hospital costs and obtain price discounts; and increases in the aged population; and WHEREAS, there have also been dramatic changes in the economy of Northeast Ohio, including high unemployment and economic uncertainties, which have resulted in increased burdens on individuals to pay for medical care; and WHEREAS, in today's economy and changing health care environment, public hospitals are particularly Vulnerable because of limitations on their ability to compete with nonprofit hospitals and other private health care 'delivery systems for patient revenues; and WHEREAS, many public hospitals in Ohio and across the nation have determined that it is in the best interest of their institutions to change their governing and operating organizations to charitable corporations so as to obtain operating and legal flexibility necessary to adapt to new fiscal and economic conditions; and WHEREAS, as a public hospital in today's health care environment, Lakewood Hospital's ability to maintain its financial viability and capacity to serve the indigent is subject to severe legal and organizational limita- tions; and WHEREAS, there are financial limitations upon the ability of this City to provide subsidies for the operation of Lakewood Hospital; and WHEREAS, in response to the changing health care environment, the Hospital Trustees, with the assistance of health care consultants, carefully studied and evaluated alternative methods of governance for the Facilities and determined that a reorganization of the governance of Lakewood Hospital into a charitable corporation is necessary to enable it to compete with nonprofit hospitals and other private health care delivery systems for patient revenues and thereby maintain its financial viability and its capacity to serve the indigent; and WHEREAS, the electors of this City have authorized a procedure for implementation of the determination of the Hospital Trustees with respect to