In advance of the Lee County Board of County Commissioners’ workshop on the potential conversion of Lee Health to a private nonprofit structure, representatives from the health care system emphasized it is not contemplating a sale.
Questions about a possible sale arose during public hearings before Lee Health board of directors voted 9-1 June 13 in favor of pursuing the conversion. Lee commissioners now have until mid-October to make a final determination.
Lee Health ‘not for sale’
Michael Nachef
Lee Health Vice President of Government Affairs Michael Nachef stressed that the system is not for sale and reiterated Lee Health CEO and President Dr. Larry Antonucci’s goals for the potential conversion.
“Dr. Antonucci has said in the past, if you listen to him, that the goal is to make Lee Health stronger and keep it local, and that is 100% the goal,” Nachef said. “We do not want to sell. Lee Health is not for sale. I cannot be more explicitly clear about that point.”
Safety net status to remain intact
Nachef also stressed that the system fully intends to honor its “safety net” status, providing care regardless of patients’ ability to pay, in perpetuity. In 2023, Lee Health provided $180 million in charity care/community benefit. Questions about that commitment, including from Lee Health board member Therese Everly at the June 13 meeting, came up repeatedly during the conversion exploration process.
In a prepared statement Everly read at the June 13 Lee Health board meeting, Everly, who ultimately cast the sole dissenting vote, said, “Lee Health has always committed to meeting the charity benefit by utilizing a community benefit benchmark. The current mission agreement states a new nonprofit will continue to maintain a policy of providing charity care to the underserved population in Lee County. Consistent with similar situated tax-exempt safety net providers in Florida, I have asked what the current benchmark is and how Lee Health currently rates against that benchmark.” She added that system staff was working to provide the information that was “still in the preliminary stages of defining.”
Asked about the community benefit benchmark and about continuing questions from critics of the conversion process about the system’s commitment to the safety net mission, Nachef said the benchmark he would suggest is the current community benefit, which is published every year.
Jesse Neil
“You can see the dollar thresholds and you can see the other safety net hospitals in the state of Florida providing similar community benefits,” Nachef said. “They’re not all exactly the same as that; they’re not all accounted exactly the same. But you can see what Lee Health is delivering in terms of uncompensated care and wholly charity care, and that is pretty explicit, right? And so are the mechanisms by which we deliver that care, so I think that is the benchmark.”
Jesse Neil, a partner at law firm Holland & Knight who has been advising Lee Health during the conversion exploration, added that there are certain legal requirements with regard to community benefit and charity care to maintain that status.
“The IRS has considered hard dollar thresholds in order to maintain that status and they have consistently declined to adopt that approach because it’s really important for hospitals and communities to be able to kind of tailor their engagement to what gives the most value and support and access to their unique population,” Neil said. It’s important to retain flexibility on that in order to maximize your positive impact in the community. And I think the IRS approach reflects that.”
Regarding continued skepticism from some opponents of the conversion process related to the permanence of the safety net, Nachef was asked if Lee County residents need to accept “on faith” that it will be permanent.
“The ‘good faith’ comment is, I believe, a misnomer, because it’s contractual,” Nachef said. “It’s there [in the draft mission agreement], so that’s not asking for good faith. That’s seeing it explicitly written.”
Requests for additional financial information
Nachef and Neil were also asked about concerns continuing to be raised by local physician Dr. Raymond Kordonowy regarding a valuation of system assets that he says is required by a section of a legislative enabling act passed in 2023 that made it possible for Lee Health to explore a conversion. Kordonowy recently submitted a petition to Lee commissioners and a request to the Office of the Florida Attorney General asking for its help in obtaining additional information from Lee Health. He said the AG’s office responded saying “this is not an issue for them and their jurisdiction” and recommended that he submit a public records request and keep pursuing the information that is publicly available.
“In terms of complying with the legislation that was passed and the regulations that the organization is subject to, I’m confident in terms of what we’ve been doing and how we’ve been doing it,” Neil said.
“If you look at the 95-page audited financial statement on the Lee Health website, or the one for the last three years, I think you’ll be able to find a perfectly accurate accounting of exactly what the system’s worth,” Nachef added. “If you go on the website, you can see the listing of 305 Lee Health locations across Lee County; those things are all on there. So, I believe the attorney general was clear in the sense that they referred him back to the information publicly available and to keep asking Lee Health. Lee Health is clearly following the enabling act and the laws prescribed. And all of the information, it might not be explicitly compiled the way he is asking for it, but it’s all available to him: It just takes a little bit of reading.”
At the July 30 workshop, which will take place following the regular Board of Commissioners meeting that starts at 9:30 a.m., representatives from both Lee Health and Lee County will be presenting to the commissioners, said Betsy Clayton, director of the county’s office of community engagement.
The July 30 workshop is open to the public, and presentation materials from Lee Health and the county will be posted at leegov.com later this week, Clayton said.
