Robinson Memorial Hospital has taken a major step toward operating as a not-for-profit hospital at the start of 2014.
Hospital officials announced Tuesday that Robinson Health System, Inc., the new corporation formed to operate the hospital, was granted tax-exempt status by the Internal Revenue Service on Sept. 30
Stephen Colecchi, the hospital's president and CEO, said the approval is a key step in the 117-staffed-bed hospital's plans to convert from county ownership to not-for-profit. Robinson Health System, Inc. was formed in November 2012 as an Ohio not-for-profit corporation. The hospital is the second-largest employer in Portage County, behind Kent State University.
Robinson Health System, Inc. entered into a lease agreement for Robinson Memorial Hospital with the Portage County commissioners on Nov. 13, 2012. The effective date of the lease agreement was contingent on the approval of tax exempt status for Robinson Health System, Inc., Colecchi said.
"This approval is very important because it now allows the hospital to complete its conversion to not-for-profit status," Colecchi said.
"We have notified the county commissioners that we will begin operating Robinson Memorial as a not-for-profit hospital on Jan. 1, 2014. This will allow us enough time to share information with our employees regarding the new employee retirement and benefits plans," Colecchi said.
He said the change in status "will be seamless from the patient point-of-view" and that all charitable care policies will remain unchanged.
"The conversion of Robinson Memorial to not-for-profit is an important step in the history of the hospital and will give us the flexibility to partner with other health care providers to continue to meet the health care needs of the residents of Portage County." Colecchi said.
Earlier this year, Robinson officials announced the hospital's affiliation with Summa Health Systems would be allowed to expire at the end of 2013. Robinson and Summa have had an affiliation agreement since 2007.
Colecchi said Robinson is looking at new partnership opportunities made possible under not-for-profit status.
"We're in the process of reviewing responses to our request for partnership proposals. We have received a number of highly competitive proposals," Colecchi said.
The operating corporation hopes to have a letter of intent signed and a definitive agreement by the end of this year, Colecchi said, with an effective date by the second quarter of 2014.
The change in status also includes a change in the board structure. Robinson Health System, Inc. will be governed by a 15-member board of directors. The initial board of directors will consist of the 10 current members of the Robinson Memorial Hospital Board of Trustees and five new board members.
The selection of the new board members will be finalized in the next several weeks. The increase in the number of board members will result in a broader community representation on the hospital board, Colecchi said.
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