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About this blog: I am a native of Alameda County, grew up in Pleasanton and currently live in the house I grew up in that is more than 100 years old. I spent 39 years in the daily newspaper business and wrote a column for more than 25 years in add...  (More)

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Following up on ValleyCare directors' compensation

Uploaded: Feb 20, 2014
Following up on ValleyCare and its board of directors—the federal 990 tax forms showed income for the volunteer directors starting in 2010.
The board has served without any cash compensation since the hospital was founded back in the 1960s. John Sensiba, the board chair, checked out why there was compensation listed for directors and learned that it is the hospital's share of the cost of health insurance. When the Affordable Care Act (ObamaCare) passed, it required reporting of health benefits. So the accounting firm listed the value of the hospital's share of the health insurance cost on the 990s.
By the policy that has been in effect since 1985, directors are eligible for health insurance just as employees are and the hospital pays the same percentage of the overall cost for each of them. So, depending upon employee status and benefits of spouses and their employers, some directors opted in and others did not.
The hospital share for some self-employed directors was $18,500 with the directors paying remaining balance.
Sensiba said he will bring the matter up to the board for discussion. To be fair, health insurance was often a benefit given to elected officials (particularly before costs soared) as well as directors of some other non-profit organizations. Given the amount of time many of them invest on the public's behalf, the "compensation" is trivial.
In response to the comment about taxpayers backing up ValleyCare, I would point back to Sensiba's comment that the medical foundation may lose money—particularly in the ramp-up period—but what's critical is the overall system's financial performance. Despite the losses of the foundation, the overall corporation is positive on the bottom line. He also said that the trajectory of foundation losses must be changed substantially.

Comments

Posted by cost concerned livermore resident, a resident of another community,
on Feb 27, 2014 at 12:07 am

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Page 23 of 990 of VALLEYCARE MEDICAL FOUNDATION (not valleycare hospital 990) listed the highest earned officers and directors of medical foundation.

Interestingly, one physician get compensation for hospital directorship above $ 103,000 (in addition to $254,000 from valleycare medical foundations). Hospital directors are chosen and selected by hospital administration lead by CEO and each hour of directorship compensation has to be accountable for amount of time input the particular directorship position.

Valleycare Medical Foundation 990 shows 25 MILLION EXPENSE out of 17 MILLION REVENUE (WITH 8.5 M LOSS ONLY FOR 2011). Significant portion of 25 million expense needs to be cut to become somewhat balance neutral for valleycare medical foundation.

CUMULATIVE LOSS OF 31 MILLION since Valleycare medical foundation was established in 2008 has to be at least partially responsible for current valleycare health system financial situation.

Interim CEO interview with Independence Newspaper on Feb 14, 2014:

"ValleyCare has had negative balances at the end of fiscal years for several years. During the most recent fiscal year, ending June 30, 2013, the books showed a $5.1 million loss."
"The annual losses have depleted ValleyCare\\\'s cash. "That is why it is so critical now that we return to a positive margin and rebuild them," said Gregerson."

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