Sunday, May 2, 2010

Still NO response to these questions on the Wellness Center from any VHS official

For the record, the editorial was in print in the Winchester Star back on 10-16-2009.

Valley Health opened the doors of their new Wellness Center last September of 2008. Since it’s nearing a year old, it’s fair to the local community to be aware of its annual checkup.  The $17million dollar Wellness Center project was funded from VHS [Valley Health System] cash reserves.  FY 2004 year-end balance sheets showed cash, cash equivalents and investments in excess of $170 million, easily sufficient to finance the capital costs of the project. Still have not been able to obtain the figures on Valley Health’s cash reserves for FY2005, 2006, 2007 and 2008.

Since Valley Health is a not-for-profit, one can be under the assumption that this information should be made available to the public when it’s requested. Unfortunately, the former CEO did not provide that answer as it was a question featured in the open forum of the Winchester Star on February 23, 2009 “Vexing Paradox”, Questions posed to better understand VH ‘community benefit’.

Below are a few reasonable questions that should be a good barometer to inform the local community on how the Wellness Center is operating during these difficult economic times. Quotes and statements were obtained from the Quad State Business Journal in May of 2006.

- Are the current members at the Wellness Center representing all of the economic classes from our local community?

One issue raised by the International Health, Racquet and Sportsclub Association in Boston, in a January [2005] letter to Valley Health's board of directors, is that "to justify a hospital-affiliated fitness facility' tax exempt status, it must restrict membership to hospital patients; or if non-patients will be members it must be available to the entire community and be able to document that its membership is representative of all economic classes in the community. The tax exemption of several hospitals has been challenged, often successfully, because hospitals have failed to meet theses guidelines."

- What are the outreach programs available where anyone can come at any time and there are no fees?

Dena Kent said financial aid would be available to some people. "We will do health assessments on every member and develop individual plans for them. If they have a medical condition that needs attention, then they can get a scholarship [if they are needy].  "There will be a number of health outreach programs, where anyone can come at any time and there are no fees."

- What is the current membership and what is the age breakdown of present members? It has been said current membership is somewhere between 5,000 – 6,000 members.

In projections used for COPN (Certificate of Pubic Need) approval, Valley Health said it is looking at a membership of 4,000 persons, targeting the 35-to 80-age group, especially people who don't exercise, said Kent.

- Have local tax paying health club memberships increased since the Wellness Center opened it’s door to the local public, or worse yet, did any of them shutdown within the last year?

"I have met with owners of the local clubs, and some say we will take members away from them," said Kent. "But we are hoping to attract people who don't exercise. In most markets, commercial clubs did not go out of business; their memberships actually went up because of the increased awareness of fitness."

Valley Health is projecting the wellness center business will break even in its second year, and after the third year will throw off cash flow of almost $1.3 million. Funding the cost of the center from Valley Health internal resources means there is no requirement for debt service.

For the record, the information above was in print in the Winchester Star back on 10-16-2009.

View these documents of interests below:

January 2005 - Letter from IHRSA to VHS BOD's that went unanswered according to Tim Sullivan who is a Legislative Analyst for IHRSA, International Health, Racquet & Sportsclub Association.

May 2006 - Article that was featured in the Quad State Business Journal.
VHS Plans to Build Wellness Center

Between the Winchester Star on April 9th's and NVDaily's April 17th front page articles, was able to obtain the following information:

(NVDaily) - The center, which opened in September 2008, brought in $1.1 million in revenue in its first three months of operation, according to tax records.

(WincStar) - Just before the wellness and fitness center opened in September 2008, it had collected 3,200 applications for membership.

Kent said the goal was to reach 5,000 members in three years, but it has moved beyond that. “We hit that number in a year,” she said, noting that the center now has 5,800 members.



Want to go on the record as today is November 3, 2009 and still no response from Valley Health officials in regards to my questions.


Today is Sunday, December 20, 2009 and still NO response from VHS reps.


- Update, had a phone conversation November 30, 2009 that lasted in the ballpark of 30 minutes with Mr. Mark Merrill, the new PRES/CEO of VHS and he stated that he read my commentary and would research this and get answers to my questions.

- Had lunch on December 29th with Mr. Mark Merrill and Mr. Wes William and I made mention again about getting answers to my questions about the New Wellness & Fitness Center.

- Sent e-mail on January 15th.


Still NO answers to the questions!

WHY is Valley Health continuing to ignore this request to answer these questions?

The "fee" [reduced tax] agreement that was reached between the City of Winchester and VHS is for 50yrs.

This agreement is for 50 years as long as the wellness center is operating as part of the medical center per [City Mgr, Jim O'Connor].

More information that was featured in the Winchester Star last March 2009:

To avoid a lawsuit and trial, city officials and Valley Health reached a real estate tax agreement dated March 4, 2009.

The medical organization will pay a fee based on the city’s real estate tax rate as applied to one-third of the assessed value of the wellness center, according to the agreement.

The wellness center is assessed at about $11.2 million. A third of that would be about $3.7 million.

The city’s real estate tax rate is expected to be about 77 cents per each $100 of a property’s assessed value when the next fiscal year begins July 1.

Based on those figures, Valley Health would pay a $28,490 annual fee in lieu of real estate taxes.

The annual fee will be split into two payments due at the same times as regular real estate taxes — June 5 and Dec. 5.

The nonprofit organization’s first bill will be due in June, and will be assessed at the current real estate tax rate of 68 cents per each $100. That means the initial bill for the first six months of 2009 will be about $12,580.

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