After a long year of negotiations, officials from Tenet Health and the Desert Healthcare District finally came together on Tuesday to sign the much-anticipated voter-approved agreement. This momentous event marks a significant milestone in the healthcare landscape of the region.

Securing the Future of Healthcare with a New Lease

Signing Ceremony and Voter Approval

After more than a year of dedicated efforts, the signing ceremony took place, bringing to fruition the plans for a new 30-year lease. Local voters had played a crucial role in deciding the fate of the lease through Measure AA on the November ballot. With an impressive 72% of the vote in favor, it was clear that the community was behind this important initiative. The 30-year lease between Tenet and the hospital's owner, the Desert Healthcare District, a public agency run by an elected board, holds great significance. It includes the sale of the Palm Springs hospital to Tenet at the end of the lease, along with other crucial provisions such as bringing the hospital into seismic compliance by 2030, expanding the emergency room at JFK Memorial in Indio, and providing nearly $650 million in payments to the district.This was a prime opportunity to move forward due to the stability of the elected officials on the district board. As Michele Finney, the Desert Regional CEO, pointed out, "This is a very complex arrangement that took a lot of negotiating. You really needed the consistency of the same people working the process from start to finish." The stability on both sides of the negotiation was invaluable in reaching this agreement.

Community Support and the Desert Care Network

During the press conference for the lease signing, several local leaders emphasized the importance of the November vote. It showed that the community supports the Desert Care Network and the continuum of care it provides. Alongside Desert Regional, the Desert Care Network consists of JFK Memorial and Hi-Desert Medical Center in Joshua Tree. As one leader quipped, the process wasn't always easy, but it was essential for the future of the community.Tenet Executive Vice President Michael Maloney noted that the last year consisted of "at times some very healthy and vigorous back and forth" discussions. However, it ultimately demonstrated "how important it was to this community to get this figured out and to get it done and secure the future of this important partnership."

Next Steps and Seismic Upgrades

Although the new lease doesn't officially start until May 2027, healthcare officials are already working on the next steps behind the scenes. By January 1, 2026, Desert Regional will need to submit plans for seismic upgrades to the state of California. The hospital will collaborate with the state to determine the necessary upgrades and the scope and magnitude of the work. This is a crucial task in compliance with California law, which mandates that all hospitals rebuild or retrofit by January 1, 2030, and remain fully functional in the event of an earthquake.At Desert Regional, structural seismic retrofits are needed at three buildings - the main hospital and additions, east tower, and north wing - and nonstructural retrofits at 20 buildings on the Palm Springs campus. According to a 2022 report from engineering firm Simpson Gumpertz & Heger Inc., the cost of this work is estimated to be $222 million.There are also plans to expand the emergency room at JFK Memorial. While there is no specific timeline available yet, Finney said she and her colleagues are "reengaging with the regulatory process" to make this expansion a reality.Last month, the district outlined some of the next steps it will take following the passage of Measure AA. This may include expanding its grant program by potentially increasing awards for individual applications. The district also plans to work with consultants and financial advisors to find the best ways to support funding community health needs.As District CEO Chris Christensen said, "We are tasked with now a mission of how do we go forward to help ensure, (by) working with our community partners, (that we) provide that care to our district residents and best manage the fiscal resources that are associated with that." Finney added that the hospital does collaborate and partner with the district, but "the district really has the independent decision-making on how they’ll move forward with their grant funds."Ema Sasic covers entertainment and health in the Coachella Valley. Reach her at ema.sasic@desertsun.com or on Twitter @ema_sasic.