Hospital Staying Open in Search for Buyer

The state of Maryland and Prince George's County would each pay $12 million annually for the next two years to keep the county's financially ailing hospital facilities open while searching for a new owner, under a deal announced yesterday that drew praise from those long frustrated by failed efforts to stabilize the shaky system.

Gov. Martin O'Malley (D), County Executive Jack B. Johnson (D) and County Council Chairman Sam Dean (D-Mitchellville) said they agreed that a seven-member hospital authority should be created to conduct an open and transparent bidding process for possible new companies to take over.

The authority would be made up of three members appointed by the county, three appointed by the governor and one member selected by the county's state Senate delegation.

O'Malley and county leaders were joined at the announcement by Prince George's delegates and senators, who praised the deal and said they would work hard for the passage of legislation needed to make it a reality.

"We have been able to work together to lay the groundwork for creating a world-class hospital in Prince George's County," O'Malley said. "We'll take a step forward, and we'll also stabilize what we have."

Johnson called the agreement a "blueprint that will ensure all the citizens of our county continue to receive the healthcare they deserve."

The system, anchored by the Prince George's Hospital Center in Cheverly, is owned by the county and managed by the nonprofit Dimensions Healthcare System. The system includes four other facilities and serves 180,000 patients each year, many of them poor and uninsured. Prince George's Hospital has the state's second-busiest trauma center.

Dimensions has been losing money for years, and the hospital facilities have stayed open only through public subsidies.

Politicians have long promised to come up with a long-term solution that would phase out county ownership and bring in a company that could improve the system's reputation and attract revenue from privately insured patients. Those solutions have remained elusive. Last year, for example, a proposal to provide the system with $329 million in state and county funds over eight years collapsed. In 2006, Johnson struck a deal with then-Gov. Robert Ehrlich (R) to spend $26 million to keep the doors open for a year, while management was sought, an effort that proved unsuccessful.

Those involved with the agreement announced yesterday said the move would be more likely to spark promising offers from private companies than previous failed efforts. They pointed to a provision of the deal that requires the state and county to agree 60 days after the legislation's enactment to a total amount that both sides would invest to help operate the system and provide renovations for outdated facilities.

Hospital companies could submit bids 30 days later. The authority would then select a new owner for the system by the start of the 2009 legislative session.

Secretary of Health and Mental Hygiene John M. Colmers said potential bidders would know at the beginning of the process how much they could expect to receive in public funding, a dynamic that might encourage wary bidders.