HOSPITAL COULD PULL OUT OF JOINT VENTURE TALKS.

Byline: Jim Skeen Daily News Staff Writer

Antelope Valley Hospital's top administrator and board president say they want to drop discussions about possible joint ventures with the nation's largest health care chain after an Assembly bill fueled speculation about a sale of hospital assets.

Antelope Valley Hospital board President Hank Marvin said he was concerned the legislation - which makes it easier for public hospitals to do business with for-profit corporations - will fan rumors regarding Columbia/HCA Healthcare Corp., a corporation that has expressed an interest in a joint venture with Antelope Valley Hospital.

The legislative effort predates discussions with Columbia/HCA, he said.

Because of the rumors of the sale of the hospital, Marvin said he is losing interest in discussions with Columbia/HCA.

``I think people are seeing a bogeyman in it,'' Marvin said. ``For that reason, I think we should forget about it.''

Robert Harenski, chief executive officer for the hospital, concurred with Marvin.

``I'm going to recommend to the board at the June 12 meeting that we drop discussions with Columbia,'' Harenski said.

Columbia/HCA held two meetings with Antelope Valley Hospital board members and staff to discuss ideas of a possible venture. After those meetings, the board wanted to explore possible options with Columbia/HCA, Marvin said.

Hospital officials said they feared that local doctors would form alliances with out-of-town hospitals, and thought affiliating with Columbia could help ensure their facility's survival.

``The board has never discussed selling the hospital,'' Marvin said.

Columbia/HCA owns more than 340 hospitals, 130 outpatient centers and 182 home health agencies in 38 states, England and Switzerland. The company has annual revenues of $17 billion.

The bill, AB 2142, authored by Assemblyman W.J. ``Pete'' Knight, R-Palmdale, is scheduled to be heard Tuesday by the Assembly Health Care Committee.

AB 2142 would authorize the transfer, at fair market value, of any part of a district's assets to any corporation, joint venture, partnership or limited liability company established by a hospital district in which the district maintains an ownership of at least 50 percent.

Existing law allows a hospital district to transfer assets to nonprofit corporations under certain conditions.

The legislation stemmed from a failed attempt by Antelope Valley Hospital to form a joint venture with local doctors to compete for contracts with health maintenance organizations and other insurance plans, Marvin said.

Antelope Valley Hospital held talks with High Desert Medical Group and Sierra Medical Group to create a separate company known as a physician hospital organization, but those talks recently ended with no agreement.

One of the difficulties in forming such a venture was state laws restricting joint ventures between public hospitals and private enterprise, Marvin said.

``We're trying to get a more level playing field, not just for Antelope Valley Hospital, but for all hospitals in California,'' Marvin said.

The hospital is still interested in forming a joint venture with local doctors, Harenski said.