Prince George's County officials reached agreement this week on a 10-year lease that will place the $80-million, county-run hospital system in the hands of a private, nonprofit corporation.
Chief Administrative Officer John Wesley White said yesterday that the lease may be given to the council for approval as early as Tuesday, so that the transfer can be accomplished by July 1 as scheduled.
"I think the lease will provide a very stable, businesslike atmosphere and hopefully better health care for the people who use these hospitals," White said. "I think everybody here views it as a very positive development."
He said the lease should not increase rates at the hospitals. "We believe we're going to increase rates consistent with costs and there will not be a profit margin in there to increase the rates," he said.
Under the terms of the lease, the nonprofit corporation, Community Hospital and Health Care Systems Inc., will make a $2.5-million annual payment to the county to run Prince George's General Hospital and Medical Center, whose property includes a nursing home, Greater Laurel-Beltsville Hospital and the Bowie Health Center, an outpatient facility.
If approved, the lease will cap years of often-heated debate over the future of the county's once financially troubled hospital system. County officials have wanted to remove the system from government control, saying that the facilities would be better managed without the potential for political interference and bureaucracy typical of some government departments.
Former County Executive Lawrence J. Hogan, who left office last December, attempted to lease the hospitals to a private, profit-making firm. The council rejected that idea after senior citizens' groups argued that a profit-making firm would fail to make adequate provisions for indigent care and would increase rates out of a need to make a profit.
Instead, the council approved an alternative proposal last year to create a private, nonprofit corporation headed by county citizens. The 19 directors of the corporation include representatives of the different employe groups, health-care activists and representatives of the current boards of each facility.
County lawyers and corporation directors have negotiated since January over the terms of the lease and reached a tentative agreement Tuesday night. Yesterday, Robert Brady Jr., a lawyer who is president of the newly formed corporation, said, "I am very satisfied with the financial arrangements."
White said the annual $2.5-million payment to the county will cover the amount of debt service the hospital system owes the county from many years of running in the red. The hospitals were supposed to run as a break-even operation but did not do so until recently and had to borrow money from the county budget to pay their bills.
White said the changeover in management of the hospitals will not immediately affect the 1,300 unionized employes, including nurses, doctors, engineers and maintenance workers. Those employes are currently negotiating a new contract for next year with the county, and those negotiations will continue on everything except wages. White said that both the corporation and the unions will have the option of reopening the wage settlement before the contract expires