Despite Petaluma Valley Hospital continually losing money and facing an uncertain future as the Affordable Care Act is rolled out nationally, St. Joseph Health System has expressed a desire to continue operating the hospital beyond the January, 2017 expiration date of its current management contract with the Petaluma Health Care District.

But whether St. Joseph's management of PVH will continue lies in the hands of the five-member, publicly elected district, which says it must explore every avenue before making a decision.

"The plan is to reach a decision on what route we want to take within the next 24-30 months," said Ramona Faith, the district's CEO, noting that the organization has formally begun to analyze its options.

The relationship between the district and St. Joseph's has not always been smooth. In the 2008 Health Care District board election, several candidates ran on a slate alleging hospital mismanagement by St. Joseph's, including inadequate physician recruitment that was threatening the hospital's viability.

In 2008, some doctors at PVH, known as the Sonoma County Medical Group, tried unsuccessfully to create an independently owned outpatient surgery center, which many said would threaten the viability of PVH. To help address the issue, St. Joseph's established a contract with the doctors to manage the hospitals operating room, giving them more control to select the equipment they needed and make decisions about patients' course of treatment. The contract also had financial benefits for the physicians, with St. Joseph paying the doctors and allowing them to share in the profits.

In 2010, that same group of doctors was dissatisfied with St. Joseph's recruitment efforts and attempted to recruit physicians independently. To rectify the issue of physician recruitment, the St. Joseph's-supported Annadel Medical Group was brought in and began actively recruiting doctors to Petaluma. Since such actions were taken, the physician's complaints appear to have been placated.

In the time since the 2008 election, the general relationship between St. Joseph and the district appears to have improved. Board member Josephine Thorton said this week that much of the newfound respect between the two entities has to do with new leadership at St. Joseph.

"There was a shift in St. Joseph's personnel from the top guy, Kevin Klockenga, who took over in 2008, down to Jane Read, vice president of operations at PVH," said Thorton. "They are all excellent people and have come in with a positive attitude and did not have any of the background or the resentments that were caused by the poor relationships from before."

Another person helping to facilitate relations between the two entities is district CEO Ramona Faith, according to Thorton. "She is a well-respected administrator and her presence has helped enormously," she added.

Klockenga's successor, current President Todd Salnas, who took over in July, has also expressed interest in fostering a strong relationship with the district and maintaining a hospital presence in Petaluma. He held a special meeting on Monday to begin garnering feedback from the PVH board on how to reach out to the community.

Options for the district to consider include extending or renewing the current contract with St. Joseph's, sending out requests for proposals to local health care providers in hopes of getting a different or more favorable contract, or running the hospital itself.

Faith said that the district is currently in the process of analyzing current operations with St. Joseph's while also studying what the needs of the community are and how to best meet them. Should they decide to solicit RFPs from other local health care providers, Sutter Medical Group, Annadel Medical Group, Marin General Hospital and Kaiser Permanente could all be potential players, along with St. Joseph's.

No matter which health care provider operates the hospital in the future, Faith said that in the long run, the district may need to explore a parcel tax to help support the hospital. She pointed out that most health care district hospitals across the state are supported by local parcel taxes.

Despite operating in the red much of the time, the hospital gained national recognition last year when the Joint Commission — a nonprofit organization that accredits and certifies health care organizations and programs in the United States — named Petaluma Valley Hospital a "Top Performer in Clinical Quality" and ranked it in the country's top 7 percent of hospitals.

St. Joseph's has continued to invest in the hospital, recently upgrading its electronic records systems to the tune of $3.5 million and continuing to upgrade medical equipment regularly.

(Contact Janelle Wetzstein at janelle.wetzstein@arguscourier.com)