Casey Abrams out of hospital and eager for Wednesday

American Idol finalist and Idyllwild resident Casey Abrams was released from the hospital today and is eager to sing in Wednesday's American Idol competition.

Abrams suffers from ulcerative colitis, an intestinal condition that can be both genetically influenced and stress aggravated.

Abrams was able to work from the hospital using Skype on the arrangements for this week's performance with AI producer Don Was. He will be in rehearsal on Monday for Wednesday's show.

According to mother Pam Pierce, Casey "sends his bear hugs to the town and Idyllwild Arts and to everyone who helped by their thoughts, wishes and prayers."

American Idol airs on Wednesday, March 16 at 8 p.m. Viewers will have a two hour window at the telecast's conclusion to vote for Casey.

Results air on Thursday, March 17, St. Patrick's Day. One contestant of the remaining 12 will be eliminated if not saved by a unanimous vote of the judges.

Shh! VHS has another bid, don't tell anyone!

What maybe the most important news about Valley Health System (VHS) was not mentioned at Monday evening’s meeting. In a Nov. 19 letter, Prime Healthcare Services Foundation has submitted an offer to purchase substantially all of VHS’s assets.

In his letter to VHS Chairman, Dr. William Cherry, Michael Sarrao, secretary and treasurer of the Foundation, describes the offer as “… a structure which is similar in many respects to the proposal submitted by Physicians for Healthy Hospitals (PHH) … there are several important differences which make [the Foundation’s] offer far superior to PHH’s proposal for the District, its residents, and its creditors.”

Not only was the new proposal omitted from the agenda, which was prepared on Nov. 20, none of the directors urged consideration of the offer, refuted its value or even mentioned its existence during their individual comments.

VHS’s legal counsel, John Marshall said the letter arrived too late to be printed in the agenda documentation. In addition, he linked the offer to the pending litigation to explain why the board would not discuss it in open session.

“…[I]t was not appropriate to discuss this in open session. While the pending litigation was properly agendized and discussed in Executive Closed Session, the specific terms of Prime's proposal were not discussed,” he said in an e-mail. “In addition, VHS is contractually bound by the terms of the Asset Sale Agreement with PHH approved by the Board in September and which is the subject of the December 15 election. Thus, VHS would be in breach of the agreement with PHH if it entered into negotiations with another party at this time.”

Sarrao also reported that the State Superior court had ordered VHS to release material regarding the sale. VHS had withheld this information (such as their consultant’s(the Piera Group) report on PHH) as privileged information.

Subsequently, Marshall said VHS is trying to overturn this ruling with respect to the evaluation materials, but has provided Prime with more than 12,000 pages of information — just what PHH requested and received.

Sarrao claims, “[Dr. Kali] Chaudhuri has an ownership interest in PHH and is the managing member of the Physicians for Healthy Hospitals, LLC, the sole shareholder of PHH. We suspect (based on, among other things, the efforts by VHS to shield these reports from disclosure by trying to create a ‘privilege’) the Peira Group reports may include a much more information about the process or lack thereof employed by VHS and PHH.”

Since the board had no new business for action, most the meeting was occupied with a dismal financial report from Interim Chief Financial Officer, Michael Bernstein, who is leaving VHS within weeks.

VHS terms with PHH

Last night, the Valley Health System (VHS) directors approved a tentative agreement with the local physicians group — Physicians for Healthy Hospitals (PHH) — for the purchase of the hospital district.

A final definitive agreement is not ready for approval, but the physicians and hospital directors were getting nervous about the timing of a necessary voter approval and the approaching December and January holidays, according to VHS counsel John Marshall.

Consequently, the board adopted a memorandum of understanding with PHH that outlines the more general or basic terms and asked the county Registrar of Voters to schedule a polling place election or a mail-in ballot election or some combination of the two. The election would occur on Tuesday, Dec. 15.

The doctors are willing to pay the existing bond debt ($42.5 million), provide $21 million for unsecured creditors, assume post-petition (means debt incurred after bankruptcy was file in December 2007) of $25 to $30 million, pay a $8.4 million not to Select Healthcare and relief on other claims amounting to $50 million, eventually this might be reduced substantially.

In aggregate, PHH says it is willing to ante up $156 million for the system. VHS would sell all of its assets (with a few minor exceptions such as a small limited trust account).

In 2007, Select Healthcare’s $135 million offer for the whole district, including Moreno Valley Medical Hospital, was rejected at the polls.

The board voted 6-1 to accept the terms and request the registrar to establish an election if the directors finally accept and approve a sales agreement.

Both Board President Dr. William Cherry and Marshall indicated that the final agreement and related documents will be available in several weeks. But Marshall warned that the sheer volume of paper and number of lawyers involved will slow the process although establishing the election day will be a strong motivator.

The sole dissenter was Director Robert O’Donnell. He was disappointed that PHH did not present a business plan to demonstrate how it will generate additional revenue to pay its own debt.

VHS’s inability to create sufficient profits to pay debt and cover current expenses has been a major criticism of recent management

When asked how the doctors’ group could accomplish this task, Director Glen Holmes, chair of the Ad Hoc committee that has negotiated for the board, asked to discuss it on Thursday.

“A lot of the hospital’s deficit is the cost of bankruptcy. That’s about $300,000 per month,” replied Dr. Alex Denes, PHH spokesman. “That will disappear because we’ll be out of bankruptcy.”

He also said the doctors plan to re-established the healthcare contracts with local groups that the former management team had canceled. He also believes that patients will return to VHS facilities because the doctors can improve the image of the hospitals.

“Nearly 50 percent of residents were seeking healthcare outside the hospital district,” he noted.

If the voters reject this offer, as they did two years ago, an "Alternative Transaction" will be effective. PHH can purchase Menifee Valley Medical Center for $29 mllion. Apparently, some VHS officials have concern about this possibility since one whole slide of Marshall's presentation addressed "Concerns abou the Alternaive Transaction", such as the district will still have one hospital — Hemet — and substantial debt.

For those still excited about this transaction and healthcare finances, go to JP's blog for additional thoughts and comments.