Can one hospital be leased to two operators at the same time? The Grossmont Healthcare District in California is thinking about it.
The district is considering leasing its 414-bed hospital in La Mesa, Calif., to for-profit Tenet Healthcare Corp., while it continues a long-term lease with not-for-profit Sharp HealthCare.
Sharp, based in San Diego, entered a 30-year lease with the district to operate the hospital in 1991. Sharp assumed $45 million in hospital debt and pays the district $1 per year.
The Grossmont district sued Sharp to break the lease in 1997, accusing former hospital executives and trustees of improperly benefiting from the deal (July 21, 1997, p. 4). The Grossmont board is scheduled to vote on a $5 million settlement offer from Sharp on Jan. 3. Sharp would continue to lease the hospital under the proposed settlement.
However, in a Dec. 19 letter to Grossmont Healthcare District President Gloria Chadwick, Santa Barbara, Calif.-based Tenet offered to lease the hospital from the district, saying the lease could be worth as much as $100 million over an unspecified period.
A Tenet spokesman said Grossmont Hospital would complement its 199-bed Alvarado Hospital Medical Center in San Diego, about four miles west of Grossmont, but he declined to comment further. Chadwick could not be reached for comment.
"We might be remiss or even foolish not to take a look at the possibilities," said district trustee Jim Stieringer of Tenet's overture. "If Sharp and Tenet were interested (in leasing jointly), we can explore the means to do it legally."
Sharp officials declined to comment on Tenet's lease overture.