Suddenly, hospital not the success story we imagined

The reaction to Ed Epperson's decision to lay off more than 50 people and shut down some programs at Carson Tahoe Regional Medical Center came quickly on May 30.

Within minutes, even before all of the laid-off workers had been informed, word leaked out into the community. The phones began ringing, and community leaders and patients and their families wanted to know what was happening.

For all of those callers, and the community as a whole, it was the first indication that not all was as it seemed within those gleaming walls.

Prior to that Tuesday, the hospital had been nothing but a good-news story, and Epperson, as its leader and the visionary of the $132 million campus, was the main character.

It was a widely told story.

At an open house prior to its official opening, about 7,000 people went to see the new building. Its scope and architecture told a story that couldn't be mistaken as anything but prosperity.

Financial reports the hospital submitted to the state in prior years didn't give any hints of trouble ahead.

Now, perhaps, the walls don't seem as majestic to some.

The reasons for the financial problems that led to the layoffs and program cuts are many, and too complex to go into in this space. Business reporter Becky Bosshart will detail them in this Sunday's edition of the Appeal.

But for now, suffice it to say that the hospital's problems have become the community's problems.

The abrupt announcement sent 745 behavioral health patients looking for new counseling programs, and it was soon clear that those scarce services wouldn't be easy to find close by. Emotional patients and parents, some of whom went so far as to credit the behavioral health programs with saving their families, were devastated.

Then there are the employees. Epperson's decision will change those lives and families as well, and some will likely have to leave town to find jobs.

Epperson said his Memorial Day weekend was spent agonizing over what he knew he had to do.

"It's painful ... I know these people," he said.

But make no mistake, it was Epperson's decision, and he does not hide from it.

The criticism following the announcement was strong and, in some cases, harsh and personal.

Some accused him of selling out the community. Others questioned his compassion.

A few people said he didn't handle the announcement well. Several prominent people in the community, including the mayor and school officials, heard the news second-hand, rather than from Epperson or other hospital administrators.

"I'm very aware the community is upset," Epperson said.

The hospital board was told about the details after the plans were final, a few days before news broke on May 30. Board member Caleb Mills said he supports the decision. "The role of a leader is to deal with all the good things and all the bad things," he said.

The reaction hasn't been all bad. Epperson said some doctors and others have applauded the move as necessary to ensure the hospital's future.

As for how he went about informing the staff and community, Epperson explains his emphasis was on informing the employees before anyone else. That's what they were doing the morning of May 30, but when word leaked out to the community, any hope of an organized information campaign was lost. Calls immediately began coming in from all fronts, including the media.

"We were playing defense," he said.

Epperson isn't sure how he could have made the actual announcement go any smoother. It was the right decision to tell the employees first, he said.

On Monday, when he met with representatives from the Nevada Appeal, he didn't back down from his decision. As he saw it, there was no choice. The hospital's finances were reeling from what were primarily situations beyond its control. He is keenly aware that banks are watching the hospital's performance, and are prepared to send in their own efficiency experts if things do not improve.

In February, Epperson called a meeting with 75 managers at the hospital and explained the problems. He asked for recommendations, but those that came in weren't going to be enough.

"It became clear to me that it would have to be an administrative decision," he said.

So he did the cutting himself. Outpatient Behavioral Health Services alone would save about $350,000 annually, and the other programs added to that total. Those programs had been, in effect, subsidized by other patients in the hospital, he said.

Since then, of course, there's been a major development. The hospital announced Wednesday it had found a way to keep the mental health and substance abuse services for hundreds of teens and children going for another six months and, it hopes, indefinitely.

Does that news mean that Epperson has backed off on his decision based on community reaction?

There's more to it than that. Epperson acknowledges they hadn't anticipated the emotion that would come from the announcement, nor did they fully gauge how critical the programs were to the school district and the community as a whole.

"The depth of that dependence did shock me," he said.

But he said he doesn't make his decisions based on public outcry. In fact, a petition with about 50 names that arrived on Thursday ended up in his wastebasket.

The resurrection of the program became possible because the hospital found other funding sources, which may include the city and school district. The hospital also learned of a funding source it hadn't considered before that state officials brought to its attention, he said.

Now the logical question is whether the cuts have been enough to put the hospital on solid financial footing.

Epperson believes it is, but also knows there is much outside the hospital's control, including reimbursement from insurance providers.

"I think the future is incredibly bright," he said. "We just had to make this correction to make sure."

• Barry Ginter is the editor of the Appeal. Contact him at bginter@nevadaappeal.com or 881-1221.