http://mv-voice.com/print/story/print/2012/10/19/five-running-for-hospital-district-board


Mountain View Voice

News - October 19, 2012

Five running for hospital district board

by Nick Veronin

In the first contested election since 2002, three newcomers and two incumbents are running this November for three seats on the El Camino Hospital District's board of directors.

The challengers, Dennis Chiu, Bill James and Julia Miller, are competing with current board members Wes Alles and John Zoglin. Catherine Vonnegut took out nomination papers, but ultimately decided against entering the race.

Alles is running for a third full term; Zoglin is running for his second. There is an open seat on the board, left vacant after Uwe Kladde resigned on May 15.

The board of directors oversees the district, which collects taxes from residents living within its borders, which encompasses all of Mountain View, Los Altos and Los Altos Hills, as well as a large portion of Sunnyvale and some of Palo Alto and Cupertino. The taxpayer money goes to fund community health programs and is reinvested in the hospital.

The district board of directors also makes up the majority of the hospital corporation's board. Critics have said this dual role leads to conflicts of interest. All non-incumbents said they are concerned with this issue, along with other criticisms the board has faced recently.

The Voice asked the candidates questions about recent criticism directed at the hospital, such as the Santa Clara County Civil Grand Jury and LAFCO reports, as well as issues facing the hospital, including Measure M — the November initiative that would limit hospital executives' pay to no more than twice what the governor makes — and union relations.

The election will be held Tuesday, Nov. 6.

Dennis Chiu

Dennis Chiu, a lawyer and the owner of the Sunnyvale-based firm Prodigy Law, said he is running because he believes the hospital has strayed from its original purpose and he wants to get it back on track.

If elected, the Sunnyvale resident said he would push to improve the hospital's preventative care, direct more money from the corporation toward community benefit, and work diligently to eliminate any conflict of interest from the hospital's dual board structure or how it spends taxpayer money.

"I want to create a better hospital," Chiu said. "I thought this would be a great way to give back to the community."

Before starting his law firm, Chiu worked from 2001 to 2004 as the vice president and general counsel for Asian Americans for Community Involvement, a non-profit healthcare organization based in San Jose. While at AACI, he provided legal counsel, managed business operations, worked with government agencies to maintain healthcare funding, and represented the organization in the community.

Chiu has been on the Santa Clara County Planning Commission for 12 years and currently serves as its vice-chair.

Chiu said he has experience with mergers and acquisitions, which could be an asset in dealing with issues surrounding the hospital's purchase of the Los Gatos Community Hospital.

And he has a plan to increase the amount of money the hospital contributes to its community benefit programs. District financial officials are unnecessarily limiting themselves by applying a law known as the "Gann appropriations limit" when making contributions to community benefit programs, Chiu said.

"There is no court case and there is no (court) opinion ... that the Gann appropriations limit applies to health care districts," he said. Because the El Camino district is abiding by that limit, however, it has "forced the hospital to give less in community benefits and forced them to do many things with the taxpayer money that might not have been necessary."

The hospital's dual board structure — where the same five members sit on both the corporation and the district board — can lead to many perceived — and some actual — conflicts of interest, Chiu said. To combat this, he proposed allowing the hospital district to allocate some taxpayer money to pay the salary of a watchdog. This person would be responsible for eliminating any perceived or actual conflicts of interest.

Chiu said he was a bit conflicted on the matter of Measure M. He said he was opposed to Measure M on the grounds that it would likely end up costing the hospital a great deal of money in an inevitable lawsuit challenging the law's validity. But on the other hand, he said, "I do not agree with the concept that you have to pay $1.1 million to get a good CEO."

When it comes to the relationship between the hospital and the union, Chiu said he recognizes that it has been strained of late. He said he would do his best to encourage management and union leaders to approach the bargaining table not like someone bartering at a swap meet — starting with a proposals that are "miles apart" and then slowly moving back toward the middle — but rather with a proposal they each think the other might accept. "If both sides see that the other side is being reasonable, then they can work together."

Bill James

Bill James is a patent lawyer and partner at Van Pelt, Yi & James LLP, a Cupertino-based intellectual property law firm. He ran for the hospital district board in 2002, but was defeated by the incumbents. James is running on the same platform: to bring greater transparency to the hospital.

Too many decisions are made behind closed doors at El Camino, he said, and although since his last campaign the district has come a long way toward increasing transparency, James said there is still work to do.

The operation of the Los Gatos campus creates conflicts of interest that need to be addressed, as does the dual board structure of the hospital corporation and the hospital district, he said.

James said the things he learned in his first run for the board and his work with the League of Women Voters in their 2005 quest to open up the hospital make him an ideal candidate. "I know about the hospital," he said. "I think I know what to do about it."

James has served on the board of directors of the Community Services Agency, which serves Mountain View, Los Altos, and Los Altos Hills.

If elected, James said he would work to put policies and protocols in place that would combat conflicts of interest, real or perceived. He said he wants to further open the hospital's financials "another layer down" and reveal what he called "character-level detail."

"If you look at it now, you see numbers that are basically money in and money out," he said. "But what you can't see is what they're spending the money on. You don't see the kinds of numbers that give you a sense of the priorities that are being built into the decision-making at the hospital. Those numbers should be out there so that the people know what they are and people can engage the board in a discussion about them."

James said that further opening the hospital's books will likely require a culture shift among the hospital's administrators and the board — and that would be a good thing.

Due to the way the hospital's two boards are structured, he said, conflicts of interest are bound to arise. The hospital corporation board is charged with overseeing the financial health of the entire hospital system, which includes the Los Gatos campus — which sits about 6 miles outside the hospital district's boundaries. The five members from the hospital corporation board, who are directly accountable to the district taxpayers, and who also sit on the hospital district board, cannot help but consider how decisions they are making for the district will impact the corporation. And vice versa.

As it stands now, he said the board invokes its right to protect trade secrets far too often in order to hold meetings out of the public eye.

"For example, in buying the Los Gatos hospital — that was a pretty big deal for the district and the community — and their decision-making about that was all made in closed session," he said. "They went public with it before they took the final action on it, but I think they had decided by the time they did that. The hospital district and the community would benefit from a more public process."

James said he would have pushed for a well-publicized town hall meeting on that topic. If elected, James said he will advocate for the board to hold a number of meetings off campus — perhaps at a local Rotary Club or library — in order to bring more visibility to the board and their decision making process.

"We need a policy-making process that involves the public in a meaningful way," James said.

John Zoglin

John Zoglin is a practice leader of digital marketing with IBM and is running for his second full term on the El Camino Hospital district board of directors. Appointed in 2007, he was first elected in 2008. He said he believes the hospital is in better shape now than when he first took office, and said he has the knowledge and commitment to keep the organization on the right track.

The current board chairman has deep ties to the hospital and the city of Mountain View. His father, a doctor, was the hospital's third chief of staff and his mother served as Mountain View's mayor and a for number of terms on the city council. On top of that, Zoglin has a strong emotional connection to El Camino — the hospital where his tonsils were removed, his premature daughters were born and nursed to health and his mother's life was extended thanks to the hospital's CyberKnife technology.

"I was brought up to believe that participating in your community is what you do," Zoglin said. "I want to participate, and I think I have a proven track record with the hospital."

That track record, Zoglin noted, includes recent efforts made by the board to respond to criticism that the hospital is not as transparent enough. In response to critiques from the Santa Clara County Civil Grand Jury and the Local Agency Formation Commission (LAFCO), Zoglin and his colleagues on the board began taking action to open up the hospital to the public.

"At that time, we certainly could have improved," Zoglin said, referring to the critical reports. He said he believes the way that data was being presented to the public — in board meetings, on the web and otherwise — was "confusing."

More than a year since the grand jury report, the hospital has changed the way it holds meetings — holding hospital corporation board meetings on a different night from hospital district meetings, creating a separate website for the district, presenting its public financial reports in a manner that is easier to understand, and bringing in experts in the fields of health care, business and technology to help the board better understand the issues.

Zoglin defended the hospital's decision to purchase the Los Gatos Community Hospital. He explained that El Camino has always treated patients from beyond the district's borders, and that the new campus has allowed hospital affiliated physicians to reach more patients — which has been beneficial for patients as well as doctors. Plus, the new hospital is making money, he said.

"We think it did strengthen the quality of care within the district," he said. "And it's been very successful financially."

Zoglin voted against the dismissal of former CEO Ken Graham. He wouldn't comment further on the reasons behind the executive's firing, but said that El Camino's new leader Tomi Ryba is working out well.

He opposes Measure M, calling it "wildly inappropriate." He didn't want to speculate on what he would do if the measure passed, saying that it would have to be a "board decision." However, he did say, "Anything that is passed, you have to make sure it's legal."

In his nearly five years on the board, Zoglin has gained a working knowledge of the hospital that he said could only be considered an asset to have on the hospital's boards — especially as the entire health care industry is "in flux" due to implementation of the Affordable Care Act.

Wes Alles

Wes Alles is director of the Stanford Health Improvement Program and is running for his third term on the El Camino Hospital board. He was first appointed in 2003 and was elected for his first term the following year. Alles said his decade of experience on the board and his 35-year career in the health care industry make him an obvious choice for the job.

"Health care is an extremely complex business," Alles said, noting that El Camino Hospital's dual corporation-district structure make it particularly complex. "I have a broad understanding of the hospital, what it means to be a district hospital and how to govern the hospital in a way that helps protect it as an asset in the community."

Alles said he is seeking re-election because he is dedicated to public service and wants the best for the community hospital. "We are all people of good will and good faith," he said, referring to the board. "We want to do the right thing."

And it is clear that Alles feels he has been doing the right things, at least when it comes to the majority of decisions made while serving on the hospital board. In responding to criticism from the grand jury and LAFCO, he said that the health care organization had done nothing wrong.

Alles said he felt there was nothing inherently wrong with the hospital's bookkeeping practices ("the information was in there"), a grand jury criticism, and said that the hospital did not use taxpayer money to purchase the Los Gatos Community Hospital.

When it comes to the LAFCO audit, Alles had a criticism of his own. Harvey Rose — the independent contractor LAFCO hired to conduct

the audit — "clearly didn't entirely grasp all the issues," Alles said.

Once all the dust had settled, Alles said, "There was nothing in my mind from any of those reports that gave a hint that the hospital was trying to hide something."

Nevertheless, the hospital made several adjustments, which he said have made things even clearer than they once were — such as creating a separate district website, holding district board meetings separately from hospital corporation board meetings and tweaking public financial statements so that they are easier to follow.

"Our intent is to be as clear as we can; our intent is not to be secretive," he said. "I'm not sure how much more we can do."

Like Zoglin, Alles does not agree with the criticism over the purchase of the Los Gatos facility. He noted that the new campus became profitable within a year and that it has given the hospital more bargaining power with insurers.

Alles is opposed to Measure M. He called the measure "misguided," and said that he could envision a "cascading effect" of the hospital's most qualified executive talent leaving the organization if the measure were to pass.

Although he would be entering his third term if elected in November, Alles said he isn't simply trying to maintain his position of power or perpetuate the status quo. "I think boards need to be refreshed, but that needs to happen over time," he said. But because of all the challenges coming down the line for the hospital, particularly the changes that will come as a result of the Affordable Care Act, he said it makes sense to keep the board stacked with experienced directors.

Julia Miller

Julia Miller is a retired Lockheed Martin administrator and the former mayor of Sunnyvale. She said she decided to run after being encouraged to do so by friends and former colleagues. In addition to her tenure as mayor, Miller has a great deal of experience in community service — working on the Association of Bay Area Governments Executive Board, the Bay Area Air Quality Management Board, and on the board of the San Francisco Bay Trail.

The longtime civil servant said she believes she would do right by El Camino Hospital, which she called "a jewel in the community," and which she said she believes has been unfortunately mismanaged of late. Evidence of El Camino's mismanagement, Miller said, can be found in the unflattering pair of reports issued by the Santa Clara County Civil Grand Jury and the LAFCO.

"I think there needs to be more transparency and accountability for the bond and tax dollars, and how that money mixes in with the corporation's profits," Miller said.

The candidate pointed to her background at Lockheed, along with her years of experience running local government operations, as proof that she is highly qualified to turn the hospital around.

Miller has racked up an impressive roster of backers. She has been endorsed by U.S. Secretary of Transportation Norman Mineta, State Controller John Chiang, Congressman Mike Honda and Congresswoman Karen Bass, and a host of other prominent state and local political figures.

Miller said she was uncertain of the details of the dismissal of former El Camino CEO Ken Graham — and agreed with the hospital board's decision to keep those reasons private. She said it appears that it was the right decision, and that Tomi Ryba, the hospital's current chief, appears to be doing a good job getting the hospital back on track after a rocky few financial quarters in which they posted significant losses.

She said she believes Measure M is "a reaction to an action" — brought on by the fact that members of the workers union were upset with the contract that was imposed upon them. Miller does not agree with the initiative's rationale or goals, and she is suspicious it might not be legal.

If the measure were to pass, and if it turned out to significantly hinder the hospital's ability to hire upper level management, Miller said she would look into other ways of compensating administrators outside of formal salary — such as food, transportation and housing allowances.

In the end, though, Miller doesn't think that will be necessary. "I think we have a very wise electorate," she said. "I don't think it will pass."

While it was clear that Miller had many ideas about what improvements she would like to see at El Camino, she was less clear when it came to exactly how she would bring about those improvements. She repeatedly noted there was a great deal of information she does not have access to since she is not currently on the board.

However, as an experienced public servant with a personal connection to and a deep respect for the hospital, Miller said she is confident that she could get up to speed fast. Miller said she would reach out to all parties, keep an open mind and an open door.

"I think relationships, building trust and open communication are important," she said.

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