Gleason: KMC recovery is county’s top priority

Rebecca Neipp

News Review Staff Writer

In the fallout from discovering a $64-million liability for Kern Medical Center and subsequent firing of the facility’s chief executive officer, Kern County 1st District Supervisor Mick Gleason said that the county’s top focus is stabilizing the medical facility and strategizing how to pay off its debts.

“The action to terminate [Paul Hensler] was based on a fundamental loss of confidence in his ability to right the ship,” said Gleason. County Administrative Officer John Nilon has since been named acting CEO while the county searches for a permanent replacement.

“We had a vacuum of leadership and a morale problem in a high-risk environment, when you view it from an operational perspective. We had to fill that void very quickly. John has moved his office, his parking spot and everything else to KMC, and that is where he will report every morning for work.”

Gleason said that the county’s top administrative officer is well staffed to cover the responsibilities associated with both offices, at least on a temporary basis.

“We are hesitant to make a hasty decision here because we don’t want to risk perpetuating the same issues that led us to this point,” he said. “We need a paradigm shift — some sort of innovative solution that will fundamentally change our ability to more effectively and efficiently deliver health care.

“We want to do this right. I don’t know exactly what this new leadership will look like — it could be another CEO or an advisory committee or a hospital board — I just know that we have to have something that works.”

A newly appointed finance officer of KMC reported that the facility had been chronically basing its budget on inflated revenues and overdrawing state support. Over a period of years the combined liability of those figures has been estimated by county officials in the ballpark of $64 million — which the county is ultimately liable for.

Gleason said that based on Nilon’s recommendations, the board is considering a plan that will divide the debt roughly into thirds — the first of which will be taken out of the KMC budget itself. “We are combing through the budget right now looking for expenditure reductions and inefficiencies.”

Another third is expected to come out of the county’s reserves, and another third will come out of the general fund — which means the board will have to revisit this year’s budget and spread the pain across all county functions.

“Is it fair that other departments are going to absorb the pain? Maybe not. But that’s what has to happen. Our No. 1 focus is on fixing KMC. We are one county, and we are all going to have to be a part of the solution.”

Gleason said that the county has been wringing fat out of the budget since 2008. “I think the county has done a good job of identifying waste, so in a way that makes this harder. But that process also created a budget profile that allows us to strategically identify cuts that can offset these unpredictable costs.”

He said that once the immediate financial situation has been remedied, the county also needs to take a look at countywide health care to see how it can improved. “Ultimately we can’t just focus on KMC, but on all hospitals, clinics and other facilities in the county as a whole.”

Story First Published: 2013-09-25