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Could employees buy state hospital?

In rural Baker County, the Northeast Florida State Hospital is big business.

But after a long-running debate, a new Senate proposal would transform management of the mental hospital --- either turning it over to a private company or possibly to a non-profit firm created by hospital employees.

The proposal, disclosed Thursday, followed weeks of discussions about privatizing the Baker County hospital and two others in Gadsden County and Gainesville. Community leaders from Baker and Gadsden counties have lobbied heavily against privatization, arguing that a potential loss of state jobs --- or worker benefits --- would hurt their economies.

The Senate proposal does not call for privatization of the Gadsden or Gainesville facilities. But it would create a process to turn over management of the Northeast Florida hospital to a private company, a local government or a non-profit created by employees.

That process would be designed to "select the proposal that provides the best overall long-term value to the state of Florida,'' according to the proposal, which was included in budget details released by the Senate Health and Human Services Appropriations Subcommittee.

Sen. Don Gaetz, a Niceville Republican who serves on the panel, said the idea of allowing employees to form a non-profit is innovative.

"That's the kind of entrepreneurial spirit that I think exists in many of our state agencies,'' Gaetz said.

But aside from the complexity of creating a non-profit to run a mental hospital, the idea also does not appear to resolve one of Baker County's major concerns. Workers in a privatized facility likely would not be able to continue receiving state pension and health benefits.

When asked Thursday about the privatization proposal, Baker County Commission lobbyist Chris Doolin responded simply, "We're working on it.''

Doolin said Baker County leaders understand the state budget problems that are at least partially driving the privatization discussions. But he said another way to address the issue would be to allow the Northeast Florida hospital to find ways to reduce its budget.

He also said Baker leaders would like to see analyses that would help compare operations of state-run and privatized hospitals.

It remains unclear whether lawmakers ultimately will move ahead with the privatization of the 633-bed hospital, which is in the town of Macclenny and has operated since 1959. Past legislative proposals to privatize the hospital have died after drawing political opposition from local lawmakers.

House Health Care Appropriations Chairman Matt Hudson, R-Naples, said his initial budget proposal does not call for privatization of the hospital. But he said the issue would be handled in the House by a separate committee that is looking at government reorganization.

At least one private firm, Geo Care, has expressed interest in running newly privatized hospitals. The company's president recently told the Senate subcommittee that his company could find cost savings of 6 to 14 percent.

--Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail at