Asante Health System's move to bring in new leadership for Ashland Community Hospital before a merger agreement is signed is a signal that negotiations are going well, said City Councilor Dennis Slattery, council liaison to the ACH board.
"Nothing is done until it's done," Slattery said on Friday. "But this is a good opportunity for Asante leadership to get things going."
A new management agreement that goes into effect Monday will put an Asante official in charge of ACH. Mark Marchetti, ACH's chief executive officer for almost nine years, will continue in a consulting capacity for the next two months, according to a release issued by ACH on Thursday.
Marvin Haas, who has served as chief administrative and finance officer for Asante for the past 13 years, will take on the role of interim CEO at ACH and will provide day-to-day direction and oversight there, the press release said.
Strategically, the sooner Asante can begin addressing ACH's issues, the better, Slattery said.
"This gives them a head start on getting in touch with operational issues," he said.
ACH has been seeking a merger with a larger hospital system because of financial difficulties. Unreimbursed costs associated with treating Medicare and Medicaid patients, other unpaid medical bills and charity care contributed to a $3.3 million loss last fiscal year and a $1.5 million loss in 2008-09, Marchetti has said.
Slattery said he doesn't know whether the new management agreement will result in any immediate changes, such as cost-cutting moves and layoffs.
"Change is always difficult," Slattery said. "For anybody concerned about change, we have to remind ourselves that Ashland Community Hospital was in a vulnerable position before the management agreement and affiliation. This is a move to address those vulnerabilities and shore up Ashland Community Hospital for the long term."
In a preliminary merger agreement, Asante said it will try to retain ACH employees or find new spots for them within the Asante system — which includes Rogue Regional Medical Center in Medford, Three Rivers Medical Center in Grants Pass and Asante Physician Partners, an organization to coordinate patient care inside and outside of hospitals.
Asante spokesman Grant Walker said on Friday that Asante did not have any comments about the leadership change. Janet Troy, ACH Foundation vice president of development, said ACH had no further comment beyond the press release.
With 400 employees and a $25 million annual payroll, the hospital is Ashland's third largest employer and provides the highest average wage, according to a fact sheet prepared by ACH in 2012.
In mid-February, the Ashland City Council approved a letter of intent for Asante and ACH to affiliate. The city owns the hospital property and equipment and is the sole corporate member. At that time, officials said the next step would be to create a definitive agreement, a move that would take another 60 to 90 days.
Staff reporter Vickie Aldous can be reached at 541-479-8199 or firstname.lastname@example.org.