Get rid of non-compete clause in proposed lease agreement between Tenet, health care district

Over 75 years ago, the residents of our valley formed the Desert Health Care District to bring better health care to our area. It is funded with a portion of our property tax dollars, and it owns Desert Regional Medical Center. Currently the district is in negotiations with Tenet Health Care, who leases and operates Desert Regional Medical Center for the district, as to whether to sell the hospital to Tenet at the end of the next lease. Ultimately that decision will be made by the voters this fall and given the circumstances the sale makes a lot of sense – with one glaring but quite fixable exception.

There is a problematic component in the proposed lease/sale agreement that is very concerning to me and my community of Desert Hot Springs. It should also concern other parts of the district that are, pardon the pun, in a health care desert as we are.

In one section of the proposed lease/sale agreement in very convoluted legalese would prevent the district from using its taxpayer generated funds to help any other health care provider – if it “competes” with Tenet. Arguably this is to prevent the district from opening a competing full-service hospital once Tenet purchases Desert Regional. However, the proposed lease agreement goes much further than that, which is cause for concern and needs to be clarified.

For example: if, in the future, Desert Health Care District wants to use our tax dollars to support additional health services in Desert Hot Springs or elsewhere in the valley by subsidizing someone such as DAP Health or Eisenhower or Kaiser Permanente to help open a clinic, or an urgent care, or to provide other medical services, they will not be allowed to without Tenet’s prior written consent , which Tenet can withhold in their sole and absolute discretion.

Desert Hot Springs is the fastest growing city in the Coachella Valley, yet we, like other parts of the valley, are in a health care desert. We have only a single urgent care and a great women’s and children’s health clinic both operated by DAP here. Yet most of our residents must go to other valley cities for almost all their health care services. And sometimes this is quite difficult with road closures between our city and the rest of the valley.

Our city has discussed the need for more medical clinics and health care services in Desert Hot Springs with other health care providers, but their management teams have asked us for financial help. Some of the ideas we’ve discussed are subsidizing a residence in the city for a doctor and help in funding construction of a new building. Those are the kinds of things our resident’s tax dollars that are paid to the Desert Health Care District could be utilized for in the future to expand health care options for our residents here.

If the DHCD board approves sending the lease/sale agreement to the voters this fall and voters approve it, the district will receive an immediate $100 million payment when the lease goes into effect, plus annual lease payments totaling $650 million, on top of the tax revenue paid by residents. Over the course of the lease that all adds up to nearly $1 billion dollars for the district. That money could potentially be used to fund a lot of health care services for district residents especially those in poorer parts of the valley. But if that service somehow “competes” with Tenet, the District can’t spend the money “without prior written consent (which… may withhold in its sole and absolute discretion).”

So, in a sense, if this provision remains as is and is adopted the board when they vote on sending it to this fall’s ballot, they will be abdicating their responsibility as elected officials governing how our tax dollars are spent and giving it to Tenet’s corporate management in Texas. That is not why this district was formed, and that is not why we pay our taxes to improve health care here in the valley. That’s not why we elect a board to oversee those tax dollars. It is imperative that this clause in the proposed lease be eliminated prior to it going before the voters this fall.

Gary Gardner lives in Desert Hot Springs and has served as a member of the Desert Hot Springs City Council since 2018, and can be reached at ggardner@cityofdhs.org .

This article originally appeared on Palm Springs Desert Sun: Get rid of non-compete clause in proposed lease agreement between Tenet, health care district