- The Washington Times - Monday, February 6, 2006

Prince George’s County officials yesterday said they want a new nonprofit group or academic medical center to take over the county’s struggling hospital system, and terminate their lease with the current cash-strapped management company.

The move comes weeks after Dimensions Healthcare System, which runs Prince George’s Hospital Center and Laurel Regional Hospital, warned county officials of closure without a cash subsidy of $2.5 million per month.

Yesterday, county officials downplayed the likelihood of a closure.

“There is no expectation that this county’s health system is closing,” said Michael D. Herman, chief of staff for County Executive Jack B. Johnson, a Democrat.

Mr. Herman made his comments during an industry briefing by county officials about their plans to seek a merger or acquisition of the health system.

Officials also said they want the new operator to build a hospital in Cheverly or Laurel, while they devise a strategy to fix Dimensions’ pension underfunding and bond indebtedness.

The county currently leases operation of its health system through a deal with Dimensions, which has struggled financially in recent years.

A government report last year found that Dimensions lost more than $50 million between 1999 and 2004.

In 2004, state and county officials agreed to provide a $45 million bailout to help keep the county’s largest health care provider afloat.

The system, which employs more than 2,000 workers, includes the 296-bed Prince George’s Hospital Center, 138-bed Laurel hospital, a freestanding emergency department in Bowie and a 120-bed nursing home in Cheverly.

Representatives from several local health care companies attended yesterday’s briefing, including MedStar Health, which runs Georgetown University Hospital; Adventist Healthcare, which has hospitals in Takoma Park and Rockville; and Doctors Community Hospital in Lanham.

G.T. Dunlop Ecker, Dimensions’ chief executive officer, yesterday said his company is working with county officials to seek a merger or acquisition by another health care company.

“Dimensions has agreed to work cooperatively,” Mr. Ecker said.

“Dimensions will voluntarily abate the lease,” Mr. Herman said.

The county’s decision to seek a merger or acquisition with another hospital operator follows years of deepening financial problems at Dimensions.

Last year, a report by an oversight panel appointed by state and county officials concluded Dimensions has mismanaged its resources and spent too much money on consultants over the years.

The company also has come under criticism for its decision in fiscal 2004 to give its former chief executive $500,000 for severance and one month’s work.

Previously, Mr. Ecker has said the financial crisis was caused by a combination of factors, including health care reimbursement rates, uncompensated care and the closing of D.C. General Hospital in 2001.

Financial documents provided by the county to health industry representatives yesterday shed more light on some of the recent financial difficulties.

A summary of operations showed Dimensions reported an operating loss of $11.7 million in fiscal 2004. Last year, Dimensions operated at a $1.5 million deficit, and it has lost $3.3 million in fiscal 2006, through December.

In talks with health industry representatives, county officials stressed the positives.

“There is a lot of money to be spent specifically in health care in the county,” county Budget Director Thomas Himler told health industry officials.

County officials have set a March 10 deadline for health organizations to submit offers.

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