Peter Ellsworth, president and chief executive officer of Sharp HealthCare, announced his retirement, but officials said it won't derail a deal with Columbia/HCA Healthcare Corp.
Ellsworth, 65, said he had intended to retire on Feb. 28, but board members of the San Diego-based system persuaded him to stay on to work on a joint venture with Columbia. That 50-50 deal was announced last November. Since then, Sharp officials have been working on a definitive agreement. That agreement will be reached soon, Ellsworth said, clearing the way for his departure.
However, Grossmont Hospital in La Mesa, Calif., is threatening to sue Sharp over the Columbia deal. Grossmont is a public hospital district that is leased to Sharp.
Sharp's intention to sell half of its system to Nashville, Tenn.-based Columbia creates a problem for Grossmont, said Jim Stieringer, president of the hospital district's board.
Grossmont's district board wants Sharp to either drop the lease or allow it to be included in the Columbia deal, Stieringer said last week. Under the current structure of the deal, Grossmont and Sharp Coronado (Calif.) Hospital would continue to be operated as tax-exempt facilities under their existing leases.
"That would make us a stand-alone hospital under an emasculated Sharp," Stieringer said. "We're at a competitive disadvantage. They could dump all the indigent patients on us."
A bill has been introduced in the California Legislature that would allow Grossmont to determine its own fate.
Meanwhile, Stieringer and others believe that Ellsworth's retirement won't affect the Columbia deal's progress. Ellsworth has shepherded that merger, a move that created dissension with two Sharp board members (Feb. 12, p. 85).
Apparently rumors of Ellsworth's imminent retirement also created some unease among the medical staff. A story in the San Diego Union-Tribune said Ellsworth met with Kris M. Bjornson, M.D., chief of Sharp Memorial Hospital's medical staff just before he decided to announce his retirement. "(Bjornson) told me he was interested in reporting on an attitude within the medical staff," Ellsworth told the newspaper.
Ellsworth announced his retirement by distributing a two-page memo in which he acknowledged that Sharp employees and doctors "are caught in an environment of change in the industry of which they are a part. This has resulted in understandable frustration."
In conjunction with Ellsworth's retirement announcement, Michael Murphy was named chief operating officer. Murphy had been senior vice president of business development and legal affairs.
Sharp's board had hired Korn/Ferry International, an executive search firm, to find a COO. Korn/Ferry's search will shift to the CEO position, officials said.