Questions Remain as Grady Hospital Holds Lease Hearings

By Jonathan Springston - The Atlanta Progressive News - 12/28/2007

(APN) ATLANTA – The Fulton-DeKalb Hospital Authority (FDHA) held two legally required public hearings on December 27, 2007, to let the public speak out on the proposed leasing of the Grady Health System to a nonprofit corporation.

Attendance at the hearings was relatively low due to the current holiday season, and not only among the public. Only three FDHA Board Members were in attendance.

The agreement, which is still tentative and under negotiation, provides for the leasing of Grady’s assets to the proposed Grady Memorial Hospital Corporation (GMHC), a 501(c)(3) that would oversee the daily operation of the hospital.

GMHC has not been formed as a Georgia corporation as of this date according to the Secretary of State’s website, Atlanta Progressive News can confirm. However, a name reservation was filed for GMHC on November 27, 2007, one day after FDHA passed a resolution to create the corporation.

"This is a work in progress," Pam Stephenson, FDHA Chairwoman, told Atlanta Progressive News. "We will go back and come up with something acceptable to all parties."

The draft lease states the GMHC must "irrevocably, absolutely, and unconditionally provide indigent care and charity care and operate the hospital as a safety net hospital."

While the GMHC would control Grady’s major medical services it must consult with the FDHA before eliminating any service, according to the draft lease.

If the GMHC does make a cut and the FDHA determines the move could put Grady’s Mission of serving the poor and uninsured in jeopardy, the FDHA could declare the whole lease null and void.

"The historic mission of the hospital – changing that is a deal breaker," Dr. Christopher Edwards, FDHA Vice Chair, said. "That is not an option. We envision those services will continue to be provided."

According to the November 26 resolution, the FDHA still needs to obtain recognition of tax-exempt status from the Internal Revenue Service (IRS) of the United States of the proposed corporation. It is unclear how tax-exempt status can be sought for an organization that has not yet been created.

The FDHA has to also approve a final draft of the lease agreement.
However, there are also several conditions outlined in the November 26 resolution that have not been met.

As previously reported by Atlanta Progressive News, that resolution, which provides for the creation of the GMHC, calls on the State of Georgia to provide written confirmation that it will support $30 million in annual financial support for Grady. Many state leaders, including Governor Sonny Perdue, oppose that idea.

Also, the resolution calls on the business, philanthropic, and charitable communities to provide written confirmation of their intent to provide $200 million for capital improvements to be paid over four years.

Anonymous business leaders have allegedly pledged to give Grady $200 million but only after the FDHA turns over control to the GMHC. The identity of the donor or donors remains a mystery.

While negotiations continue, it is unclear if the State, Fulton, and/or DeKalb Counties will agree to provide additional annual Grady funding or if anonymous donors would be willing to deliver $200 million before the power transfer occurs.

If these stipulations are not met, it is unknown whether or not the FDHA will decide to move forward with transferring its power and Grady’s assets to the GHMC.
In response to questions from APN, attorneys from the FDHA merely said that they were still working on trying to get additional funding.

It appears, however, that the FDHA would not be able to approve the lease, based on the language in the November 26 resolution. In that case, a new resolution may have to be passed for the lease to go forward.

Those who spoke at both hearings Thursday remain skeptical of the whole process and angry over how it is being carried out.

For example, many were outraged they did not receive copies of the draft of the lease agreement in advance of the hearings. State Sen. Vincent Fort (D-Atlanta) called it "an absolute insult."

"How can we have a public hearing on the lease agreement when it is not here?" Derrick Boazman, former Atlanta City Councilman and activist, asked.

"Without the actual document in the room, we don’t know what we’re discussing. We’re just talking to each other."

Indeed, copies of the draft were not available to the public or press until near the end of the first hearing, when copies finally circulated.

Many citizens maintained the FDHA’s plan to relinquish control of Grady to a nonprofit corporation is a sham which will endanger the hospital’s mission of serving the poor and uninsured.

"People in the streets are totally baffled by what’s happening behind closed doors," Dianne Mathiowetz, member of the Atlanta International Action Center, said. "If this new Board thinks it’s going to close services, it’s not going to happen without a struggle."

"It’s up to the [FDHA] to set the record straight and snatch victory from the jaws of defeat," Leonard Tate, community activist, said. "The public is getting hoodwinked and the poor are being exploited."

The FDHA has yet to announce a specific date to discuss and vote on a final lease agreement. The FDHA will hold another public meeting sometime in early 2008 for these purposes, Chairwoman Stephenson told Atlanta Progressive News.

About the author:
Jonathan Springston is a Senior Staff Writer for Atlanta Progressive News and may be reached at jonathan@atlantaprogressivenews.com.