June 25, 2008

Twin Falls County Responds to St. Luke’s

By Nate Poppino, The Times-News, Twin Falls, Idaho

Jun. 25--Twin Falls County will begin dispute resolution procedures against St. Luke's Health System by July 2, according to a letter written in response to the latter's request to take a current clinic dispute to a judge.

The move is the latest in an ongoing dispute over remodeling St. Luke's downtown clinic building, a project the health care giant agreed to help with in the 2006 sales agreement that gave it the then-Magic Valley Regional Medical Center.

St. Luke's officials had suggested the two parties submit the issue to a judge for binding arbitration, requesting a response by 5 p.m. Tuesday. County officials took a different track, arguing that the non-binding mediation was laid out in the hospital sales agreement as the main way to solve disagreements.

In their reply, the commissioners wrote that they are extremely disappointed that St. Luke's has rejected their offer, and that the dispute process will begin effective July 2, Commission Chairman and St. Luke's Magic Valley Board Member Tom Mikesell said on Tuesday.

According to the agreement, either side can initiate mediation and have 10 days afterwards to jointly appoint a mediator. The county will submit a list of suggested mediators to hospital officials soon, Mikesell said. The list could include several based in California to cut travel costs, as counsel retained by both sides have staff in that state, he said.

A series of phone conferences and a meeting in January contributed to a $10,000 legal bill for the county that month, according to documents obtained by the Times-News in a public records request. The county employs attorneys with the Duane Morris LLP law firm based in Philadelphia for issues surrounding the hospital sale.

St. Luke's has said the sales agreement provides for $3 million in in-kind construction services for the remodel, which will turn the clinic building into office space. That figure, hospital officials said, includes using the hospital's in-house construction crew for the project as it completes work on a new hospital site in northwest Twin Falls.

County officials said they see the construction crew as separate from the $3 million figure, and that St. Luke's told them they will not be able to use the crew after all. The county is seeking an additional $2.5 million over the next two years to compensate. A study by Hummel Architects quoted by the county during early remodeling discussions in 2006 estimated the work would cost $5.5 million.

Mikesell, who has argued separately with the local hospital board about how much he has to recuse himself from meetings discussing the clinic issue, said he still hopes the board will come around and support mediation.

"We're still optimistic that the advisory board here in Twin representing the interests of the great state of Ada will come to a conclusion with benefits for the community," Mikesell said, adding that the local members are "great people" but often overruled by direction from St. Luke's corporate office in Boise.

In a May e-mail to board Chairwoman Cindy Collins, Mikesell requested a number of items, including all administrative salaries for the health system and its Boise and Twin Falls hospitals. Mikesell said Tuesday that he had received a response from the hospital questioning the request, but that his attorney hadn't shown it to him because it had little substance.


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