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Sonoma West Medical Center at a crossroads after losing lucrative drug-screening revenue


In late March, Anthem filed a lawsuit against Durall and his business holdings, accusing him of engaging in a “widespread fraudulent scheme” to enrich himself at the expense of the insurance company. Durall’s toxicology operations were the subject of a CBS News investigation last month.

Durall declined to comment on the latest lawsuit. His spokesman, Kevin Boyd of Boyd Public Relations in Fort Lauderdale, Florida, repeated Durall’s statement of last month, insisting that all testing done at the Sebastopol hospital was “properly conducted in accordance with all local, regional and federal regulations and laws.”

Colthurst and hospital officials on Friday defended their involvement with Durall, insisting that they have done nothing illegal and that all tests done at the medical center and by Reliance were properly billed.

Natalie Peters, 72, a Sebastopol resident who with her husband has attended several meetings about the hospital’s future, said certain members of the district have lost sight of their responsibility to taxpayers in the district.

Peters lives in the Harmony Union School District, which is in the hospital district’s boundaries, and believes the district board has mismanaged taxpayer funds.

“Their focus is to keep that hospital open at the cost to all of us taxpayers,” she said. “They need to have someone like Kaiser or whatever take over that hospital.”

Hospital officials and staff are convinced the hospital can make it on its own. They say the infusion of toxicology funds has put hospital on stronger financial grounds.

The medical center’s chief nursing officer and COO Barbara Vogelsang said Friday improvements to the hospital’s billing and collections procedures have resulted in greater revenue for the hospital.

These changes brought in an extra $400,000 over a three-month period, not including surgery revenue, hospital officials said.

Surgeries, which were stalled for an extended period of time from a problem with mold, have resumed and are expected to result in future revenue.

The hospital costs about $1.7 million a month in salaries and expenses to run and generates about $1.4 million in monthly revenue, not including surgeries, officials said. Hospital administrators are looking at ways to bring in more revenue, including more aggressively marketing its laboratory services.

Rosaly Medina, a registered nurse who works in the emergency department, believes the hospital can survive.

Medina said the five-bed emergency department usually sees 15 to 20 patients in a single 12-to-15 hour period, and most days averages one or two inpatient admissions to the hospital’s surgical unit.

Mark Blankenship, director of the hospital’s operating room, said that in the past four weeks since the hospital operating room reopened, 34 surgeries had been performed as of Friday.

Most of them are elective surgeries, but also emergency fracture management cases, such as broken hips, ankles and wrists.

“We’re back up, we’re open and we’re busy, and we’re happy to be so,” Blankenship said.

John Peleuses, the medical center’s CEO and president, said it’s too early to gauge how the hospital is doing after losing the lucrative flow of money from Durall’s toxicology program.

He said that the hospital’s viability based on monthly revenue would become evident in another six months.

Colthurst, the district board president, said the hospital has proven its worth. During last October’s firestorm, he said the hospital took in 21 patients in three hours that fateful Oct. 9 morning.

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