A Hospital for $1?

A Hospital for $1?

By Mathew Keller, RN JD
Regulatory and Policy Nursing Specialist 

Mathew Keller, RN JD Regulatory and Policy Nursing Specialist
Mathew Keller, RN JD
Regulatory and Policy Nursing Specialist

In a famous 1863 lawsuit involving landlord rights, Graves v. Berdan, a New York landlord sued a tenant for failing to pay his rent— for leased space in a building that had burned down. Surprisingly enough, the legal precedent at that time required tenants to continue paying rent even after the space being leased ceased to exist.

Such is the power of landlords. They grant their tenants certain rights and uses of property through the provisions of a lease. However, leases also create obligations for tenants – for example, an obligation to pay rent, an obligation to mow the lawn, an obligation to not destroy the premises; or, in the case of the tenant of Unity Hospital, Allina Health, an obligation to “operate a hospital for the benefit of, and open to, all residents of the community upon equal terms” and to “use the leased premises for a public hospital,” according to the terms of its lease with the North Suburban Hospital District Board.

Allina Health has not met these terms. The moment it began to shift its profitable services to Mercy Hospital, Allina ceased to “operate a hospital for the benefit of, and open to, all residents of the community upon equal terms.” The moment it began to implement its “one hospital two campuses” vision, with the end goal of Unity Hospital operating under Mercy Hospital’s license, Allina Health ceased to “use the leased premises for a public hospital.”

What is a landlord to do when its tenant is not meeting the terms of the lease? Reasonable minds would likely agree that eviction is in order. Indeed, the terms of the North Suburban Hospital District Board’s lease with Allina Health provide for that as well, allowing the Board to “declare a forfeiture of this lease… and re-enter into possession of the leased premises and remove all persons therefrom” in the event that Allina “defaults… in the observance or performance of any of the Hospital’s… covenants, agreements, or obligations” (such as the obligation to operate the hospital for the benefit of the community) under the lease.

When a community-owned hospital is operated by a corporation that has failed to live up to its end of the bargain, as Allina surely has done, then it’s time to force the corporation to shape up or ship out. The North Suburban Hospital District Board has that power — it could threaten to declare a forfeiture of the lease at any time. Unfortunately, the District Board has chosen instead to allow Allina to escape accountability as well as escape accountability itself through its recent vote to dissolve.  Thankfully, the wheels of justice have turned quickly and local residents had their day in court and prevented the Board’s dissolution for the time being.

The community built the hospital, they’ve put tens of millions of dollars into the hospital, they own the hospital, and now they’re being fleeced by Allina as well as their own Hospital District Board.

Landlords have a lot of power.  It’s time for the Hospital District Board to stop kowtowing to Allina Health and instead use their power to hold Allina accountable to its obligations under the terms of the lease. And if the District Board is unwilling to do so, it’s time for them to ship out themselves.

Save our hospital.

9 Comments

  1. The star tribune article presents a much more balanced view than what you’ve put together here.

    Again with the MNA fearmongering tactics designed to do what exactly? Make an employer of thousands of your members look bad. You do know that posting terribly misleading information like this ultimately hurts your own membership, right?

    Allina is expanding mental health services at Unity, a service greatly needed in our metro area. And they’ve consoldated OB to a nice new facility at Mercy. Both hospitals remain open to other standard services (ED, ICU, med surg, etc)

    This is much ado about nothing. Time to move on.

  2. Could you point to what is misleading? Everything is cited and hyperlinked. Except for your comment about “expanding” mental health, which is incorrect– they’re downsizing mental health services elsewhere and moving them to Unity, the net effect is a mere 1 added mental health bed across the Allina system. Please also explain why these communities which paid for and built a community hospital now should have a mental health facility crammed down their throats?

  3. Hyperlinking to other biased articles that have misinformation is not citing factual sources. The author that to City Pages that Mat Keller is “citing” listed that 3 nurses are running for the board. Is that accurate? They also state that the judge ruled in favor of the plaintiffs, but didn’t Mike Hatch state to the Judge he had yet to even review the contract between Unity Hospital and the North Suburban Hospital District? Didn’t Allina pay off all of the debt years ago? That information wasn’t in this blog. Also to provide a fair prospective of both sides isn’t that what journalism is supposed to be? How much is Unity Hospital’s yearly operating expenses compared to what the NSHD provides the hospital for projects that meet their criteria for funding? I have a feeling that number would minimize your argument Mat Keller, but at least you would have provided a non-biased article by providing the public with facts (journalism) vs. leaving out actual facts, including misleading information, and creating an environment of fear to the community you claim to love. I see no difference between this blog than what’s on the National Inquirer. Lastly, for those wanting to know what is occurring with the NSHD, why not review past meeting minutes? Why not post the contract agreement between the NSHD and Unity hospital? Isn’t that public information? Why not you become engaged with the boards activities a year ago? Oh that’s right the MNA had no use to bring up the Mother Baby unit moving to Mercy a year ago because they needed to wait another year to add that information to their smear campaign during the strike.

  4. Not sure what article you’re referring to specifically, bethechange, because I hyperlinked to about 5 different ones. And yes, I wish I could hyperlink to the lease I quote above, unfortunately it is not in fact public information, for whatever reason the NSHD has chosen to not have a website or offer any public information of any kind. Also not sure why you bring up the mother baby unit, I didn’t mention it in the blog. I can tell you why I didn’t mention it a year ago, though– because the board didn’t vote to dissolve a year ago, they voted to dissolve a month or two ago. Don’t care if Mike Hatch hasn’t read the agreement, I have, and I quote it above. You are off on your debt argument… Allina repaid all BONDS the board took out for construction on Unity. They haven’t paid back a dime of the $2.5 million/year or so the community has put into the hospital for 35 years, not to mention original construction costs and whatnot. Your argument about 2.5 million being a small amount in comparison is to revenue also do not make sense. That’s revenue that the board allows Allina to have. The board owns the facility. They could kick Allina out any time using the lease provisions identified in the article and bring in, say, Fairview or Heath east or someone else to run the place. The board owns the hospital, not Allina.

  5. I wasn’t talking about revenue (income) , I was talking about the overall expenses to run a hospital which is more than 2 million per year. That amount that the board provides Unity with on certain projects that meets the boards criteria is small to Unity Hospital’s 200 million per year operational cost (expenses) that I mentioned in my post. Unless the contract states that Unity was to pay the board back, I’m unsure why you mentioned that Unity owes the board money in return. Also, in your argument, you say the board should kick Allina out (unlikely since the board has no authority) and have Fairview run the hospital. In your “scenario” you would put all employees at Unity hospital at risk of losing their jobs or having to reapply for a position. I was under the impression that you’re fighting for “your” community, but wouldn’t your “scenario” put community members at risk of losing their jobs and livelihood? Sounds counter productive to me.

  6. Did you actually read the article? The board has the authority under the terms of the lease quoted above. Could very easily require any new operator of the facility to maintain current workforce.

  7. And ps, you can stop with the quotations around my community, I pay my property taxes in spring lake park, where do you pay yours?

  8. People that don’t have the courage to sign their name to their comments leads me only to believe that they are fakes or freaks or both -nevertheless, nothing they say means anything to me -sign your name you coward !

  9. What exactly is the point of this article on a nurse blog?

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