Tuesday's Vote at San Antiono

Shriners oust CEO, address funding

By Laura Elder, The Daily News Galvinston,Tx Published July 8, 2009

Caught between a hard financial reality and a desire to continue their traditional role, delegates at a national Shriners convention made an unprecedented decision Tuesday to accept third-party payment for treating children at the organization’s 22 hospitals, including its island burns hospital.

Meanwhile, delegates voted out controversial president and CEO Ralph Semb, who, citing a $3 billion dive in the organization’s national endowment, headed a drive to close six of those hospitals.

Never in its 87-year history has Shriners charged to treat a child at hospitals specializing in burns, spinal cord injury and orthopedics.

The only requirement is that patients be younger than 18 and treatable.

The philanthropic organization, however, would continue to accept all children at all its hospitals regardless of whether they had insurance or other ability to pay, Tommy Lambright, a delegate from Texas City, said.

The momentous decisions came a day after delegates voted to reverse a plan by the organization’s Tampa, Fla., headquarters to permanently close the 30-bed Shriners Hospital for Children in Galveston, known worldwide for advances in treating badly burned children. Five other Shriners hospitals considered for closure also won reprieve. But while determined to keep the hospitals open, delegates say the operations face sharp budget cuts and fundamental changes.

Although Ike damaged the island hospital, it was a $3 billion shortfall in endowment funds caused by disarray in financial markets that threatened the hospitals, Semb and others had argued. Money for the island hospital’s $34 million operating budget comes from the endowment.

Just when the island hospital at 815 Market St., closed since Hurricane Ike, would reopen and how much money it would have was unknown, Lambright said.

The hospital also would have to receive accreditation and approval from the Texas Department of Health to reopen.

Some have questioned the logic of delegates trying to keep the hospitals open with serious budget shortfalls, Lambright said.

“The underlying message is that we’ve won a victory but could lose the war,” he said. “The reality is that we’re doing other things at this convention to address the budget shortfall and new sources of income.”

The island hospital, which once employed about 325 people, would have to reassemble a staff and teams of surgeons.

Delegates are expected to approve budget issues before the convention ends this week in San Antonio.

Meanwhile, Semb, who drew fire for his insistence that the island hospital would have to remain closed after Ike, lost his bid for a sixth term as president and CEO of Shriners hospital system to Doug Maxwell.

Semb did not return phone calls.