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SPH chief stepping down

Hospital CEO will serve until his replacement is hired

Posted: Friday, August 24, 2007

In a move that surprised some and not others, South Peninsula Hospital Inc.'s Chief of Staff Charlie Franz announced his plans to leave the

hospital.

A press release issued today said Franz, who has been the hospital's CEO since 1995, submitted his intent to SPHI's board of directors and they have accepted it "with regret."

The agreement between Franz and the board is for Franz to continue as CEO until a suitable replacement is found.

"All I can say is that we wish Charlie the best of luck and we appreciate his 12 years of service," said Walt Partridge, president of SPHI's board. "We're going to try to find a replacement as quickly as we can so he can move on."

Partridge said he was "not really" surprised by Franz' announcement.

"It was a mutual agreement," he said. "He expressed a desire (to retire) and we felt it was time, and we mutually agreed with the timing and went with it."

The announcement comes at a busy time for the hospital, which is owned by the Kenai Peninsula Borough and is in the midst of a multi-million dollar expansion project. The hospital currently is completing the steps necessary to obtain a state-required Certificate of Need that will allow occupancy and utilization of the portion of the project nearing completion, as well as continuation of the project.

Failure to obtain a CON until the project was well under way drew criticism of Franz by Kenai Peninsula Borough Mayor John Williams. Questioned by the borough assembly earlier this month concerning the lack of a CON, Franz said he took full responsibility for not having applied for it earlier than July.

Without the CON, Williams delayed opening bids for the next phase of expansion, a move that pushes back construction until next year.

The hospital is transitioning to Critical Access Hospital status. In addition, negotiating a changed sublease and operating agreement are scheduled to begin in the near future.

"Even more importantly, the hospital needs to continue to operate for the benefit of the citizens of the South Peninsula," Partridge said in the press release. "Now is not the time to be without a chief executive officer to lead these efforts. Mr. Franz' background and expertise will be sorely needed until a new CEO is found."

A search committee has been established and will begin looking for a replacement immediately. Partridge said it might be several months before a new CEO will take over.

Contacted this afternoon, Williams said he was "kind of caught off guard" by the news.

"I don't have any comment to make," he said, adding that he had not seen the press release.

"I do plan on meeting with the board Monday evening and will probably learn more about it then," Williams said.

According to information provided by the hospital, during Franz' tenure as CEO, SPH patient revenue has grown from $12 million in 1996 to more than $30 million his year, a new long-term care unit has been constructed, diagnostic equipment has been added, the hospital's electronic records and digital storage of radiology images have been upgraded, a new emergency department has been added and the imaging department expanded.

Franz has served as secretary, vice chairman and chairman of the board of directors for the State Hospital and Nursing Home Association. For the past three years, he has represented Alaska to the American Hospital Association's Regional Policy Board. He also is a founding member of the Alaska Small Hospital Performance Improvement Network.

Locally, Franz has been active in the Homer Chamber of Commerce, has served on the Kenai Peninsula College Council, the Kachemak Bay Campus Advisory Board and the Infant Learning Center's board of directors.

Once a replacement is found, Franz said, "I'm going to take at least a year off and enjoy the many recreational opportunities available in our area such as fishing, hunting, kayaking and skiing."

McKibben Jackinsky can be reached at mckibben.jackinsky@homernews.com.



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