Leaders Shift At AV Hospital

A series of management turnovers have left Antelope Valley Hospital in a financial and leadership quagmire. In the latest twist, Ed Mirzabegian, has returned to the position of chief executive. He held the position for roughly seven years before pursuing executive roles with Avanti Hospitals Healthcare System, Healthcare Partners/IPA and Prime Healthcare Services. Along with Mirzabegian, Ken Robinson, new to the hospital, has assumed the role of chief financial officer. The new managers come to the hospital following investigations into their predecessors. Former chief executive Michael Wall sought to trim $24 million from the hospital’s budget. He served for two years before he was put on administrative leave in October 2018 – he resigned a month later. The chief financial officer at the time, Colette Nichols, also resigned, and the two took a combined $1 million in severance pay, according to past reports from Antelope Valley Press. Investigations were conducted into Wall and Nichols, but it’s unclear what sort of wrongdoing led to the resignations, or even if they both concluded. The hospital would not release any details regarding the investigations or why the two resigned when questioned by the Business Journal, stating it was a confidential personnel matter. Prior to Wall, the hospital board brought in a third-party health care management company to straighten out its finances in 2015, a highly unpopular choice which led to the first nurse strike in the history of the hospital. Similar to a school district, leadership and financial action for the hospital district is determined by its board, with the hospital owned by the Antelope Valley Healthcare District. If board members feel leadership is not doing its job, they can take measures to bring in someone, or an organization, they feel can do better. Alecto Healthcare Services was ousted in 2016, with current board members like Kristina Hong vowing to rid AV Hospital of the management team if she was elected. When Hong took her seat as a board member, the company was gone in a matter of months. Meanwhile, the hospital’s emergency room is the third busiest in California – the center treats 120,000 patients per year, including 1,300 traumas per year, which are 60 percent motor-vehicle related. The hospital also houses the closest neonatal intensive care unit and in-patient mental health care facility for 50 miles. The next closest would be Henry Mayo Newhall Hospital. New leadership With only months in office, Mirzabegian has made structural changes to leadership, eliminating the chief operating officer position, a role he actually filled for several years before becoming chief executive the first time around, and creating two vice president positions each responsible for different aspects of operations. Now Mirzabegian is spearheading a plan to open a modular structure attached to its emergency room and new design for the hospital. The board, at its monthly meeting in May, approved $9 million to be spent on starting a rebuild project. California’s Office of Statewide Health Planning and Development granted the hospital an extension with seismic standards for July 1, 2025, on the condition that the organization build a new hospital, according to correspondence between the two entities. If funding is not approved for the rebuild, the board would resort to a retrofit plan, changing the extension to July 1, 2022 for completion. “One of the first things is getting the board’s approval for the architectural, structural, mechanical, electrical plans; all of these together cost about $25.4 million,” Mirzabegian said. “At this point, we need only $9 million to start checking the soil, looking at some drawing plans for the new hospital.” RBB Architects will be working with the board and Mirzabegian on designing a new five-story replacement hospital, in addition to a basement. “We’ve been working with (RBB) for a long time, they know the region, they know the requirements,” said Mirzabegian. “When AV Hospital was planned, it was underbuilt. It had to struggle. Every now and then we added a section, so obviously we have to build an institution that’s needed.” Financials AV Hospital saw $310 million in net revenue for the first 10 months of this fiscal year, a decrease of $19.4 million from last year, according to Robinson, the new chief financial officer. “That’s an 8 percent difference and coincidentally, our volume is 8 percent below last year,” he added, while speaking to the board at last month’s meeting. “We’re a little bit behind the eight ball. What that does, is you come down to an operating income for the first 10 months, we’re $8.8 million negative.” For April, Robinson reported $30.6 million of net revenue, compared to $33.4 million last year in the same month. “We have had better months,” Robinson told the board. “The last couple months have been a positive improvement.” Overall, Robinson has seen a shift in patient volume, reporting a reduction in in-patient and an increase in out-patient. Temporary ER While the hospital awaits a new facility, Antelope Valley approved a temporary modular structure as an expansion to its overcrowded emergency room, with a contract for $8.7 million with RAD Technology Medical Systems. The proposal got a nod of approval from every board member, passing 4-0. Dr. Abdallah Farrukh, emergency room director and board member, has been advocating for the expansion for 10 years now. “I really think Ed did a fantastic job. You have to have patient dignity; we have to have rooms. Patients in the hallway? We can’t do that,” said Farrukh. The Business Journal witnessed first-hand what Farrukh was referencing, while getting a hospital tour after the board meeting. Patients lined the hallways, with loved ones standing near the gurneys. The busy ER was nothing new, officials said. “The modular buildings are clean. If we have a new facility, then we may not need it. If we have a new facility and the area grows, we can add to the modular building if we have to. It’s a very smart way to solve a tough problem,” he added. The 6,300-square-foot building is designed to meet the needs of a medical facility, adding four exam rooms, 12 gurney bays and 28 chairs. Mirzabegian expects the new ER space to serve an additional 44 patients. The department currently treats roughly 600 patients per day, but it was designed for about 80, he said. “Our emergency room is a very sad area as far as space and how they are taking care of our patients,” added Mirzabegian. The temporary structure will be located in a parking lot to the south of the building to create an L-shape; the ambulance bay will still function as currently configured. Officials expect the structure to be ready in less than a year.