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The Merger by novelist William S. Frankl, M.D.
Title: Books by Novelist William S. Frankl, MD

Excerpt from The Merger

Tony Mackenzie, Stetson Health Care System's CFO, and Nabil Haddad, President of Baldwin University, one of Stetson's divisions, met to review next year's budget, which included the merger with Concordia University.
"Let me summarize the problem in a few words" Mackenzie said, sitting down beside Haddad at a large conference table in Haddad's office."Because of Baldwin we're losing money like a drunk high roller at a goddamn casino." Haddad read the Baldwin figures."What about Stetson General Hospital and Stetson Health? Aren't they producing big profits?" Haddad demanded. "The last time I reviewed their financials, they looked good."
"The General is holding its own, even with declining reimbursements," Mackenzie said. "But costs are rising and reimbursements falling. The General did three hundred and ninety million in net revenues with three hundred and sixty million in costs. But we need to budget for next year and that's where we're in trouble. Remember, we've been siphoning off about ten million per year from the General to support Baldwin. It's the only way Baldwin looks like its even close to being in the black." "What about Stetson Health?" Haddad snarled.
"It's doing well. The nursing home business, the small community hospitals we own in this part of the state, the pharmacy plan, the rehab centers, the spin-offs in real estate, the sports clubs˝-are all making a profit."
"So what's the goddamn problem?" Haddad screamed, pounding on the table. "I'm worried about other things. There may be trouble at Baldwin. There's a rumor going around over at Concordia about the merger. If the docs at Baldwin get wind of it, they'll be up in arms."
"Well, Concordia's the headache you're going to put us in financially. Crunching the numbers, if Concordia is included in next year's budget, it's a disaster. Look for yourself. We hoped that increased revenues generated by these other Stetson programs, along with a decrease in losses at Baldwin, would cover the cost of taking on Concordia's debt. Well, it won't. Our revenues across the system are falling. Still, even with an increase in projected losses at Baldwin, we can survive. But not if we take on Concordia. You've got to give up the idea."
" Can't we get by with some creative accounting?" Haddad shouted. "Suppose we took receivables that are still owed to us and account for them as revenue? Make our bottom line look better and we can hope that the receivables will ultimately come in. And can't we get a loan from Alliance Bank? Dan Jenkins, its CEO, is on our board. He's been useless up to now. Let's get something out of the dumb bastard. Get a loan from his damn bank and put it on our books as revenue. I'll depend on you to deal with these things. I must have Concordia!"
"Are you going to speak to our board about this?" Mackenzie said.
"I'll speak with Hal Crossman. He'll handle things at the board level. You know they think anything Crossman and I suggest is perfectly fine. They won't be a problem."
"But, I might be," Mackenzie said. "I'm not going to jail just so you can buy Concordia."
"Tony, look. I'll propose to the board that your salary be raised to seven hundred and fifty thousand and we'll find a way to put half a million a year, in cash, into a special account for you in the Caymans, for as long as you remain our CFO. In five or ten years you'll be a multi millionaire."
"Haddad, you're crazy. You bastard, you know how to corrupt a man, don't you? We'll all be in jail because of you."
"Tony, not corrupt. Merely showing appreciation."
"I don't know. It's my job to deal with the fucking money in an honest way. Well, okay for the raise. But I need to think about your Cayman crap."
After Mackenzie left, Haddad wiped his brow, put his feet up on the conference table, and began to construct a strategy to deal with any problems the Baldwin physicians might offer.

Haddad's problem began to take shape later that day in Athens.
"Dr. Russ Carmichael is on the phone," Mary Morgan, Felix Stern's secretary said, as she entered Stern's office. Russ Carmichael, the chief of cardiology at Concordia, was ten years younger than Stern, the chief of cardiology at Baldwin.
When Mary left, Stern picked up the phone."Hello Russ, what's up? Who are you trying to steal from me today?"
Carmichael chckled. "If what I'm going to tell you is correct, pretty soon that won't be necessary. Do you know who Slade Curwen is?"
"Yeah, sure. A big time tax lawyer. What about him?" Stern asked.
"He's my patient," Carmichael said. "Comes in yearly for a complete cardiac work-up. Well, Curwen was in today, and in great confidence, of course, told me that Concordia is in talks with Baldwin to merge us. The talks are at the highest levels, which means Abassi and Haddad. I thought you deserved a heads up."
For a moment, Stern said nothing. He picked up a pencil on his desk, and with quiet rage, broke it. "Are you sure Curwen wasn't bull-shitting you? The idea is insane." But Stern remembered his daughter-in-law's tale of the meeting at the Ritz-Carlton and knew that Carmichael's information was probably correct.
"No, Felix. I think it's true. Curwen's one of the most important members of our board. Concordia and Baldwin are talking, I'm sure of it. Whether a merger will happen is still up in the air, according to Curwen. Well, got to hang up now. Let's sit down and talk soon. We'll sure need to if this merger goes through. Turf and all that stuff, you know."
"Goodbye, Russ, and thanks." Stern hung up, pushed away from his desk, swiveled his chair around and for several minutes gazed out on the Baldwin campus still covered with the last snowfall. Then he punched the intercom button. "Mary, get George Morrison on the phone and tell him I'm coming up. It's an emergency."
William S. Frankl, All Rights Reserved