History of McCall Memorial Hospital District

The McCall Memorial Hospital District was created to ensure local access to quality healthcare for the McCall area. Voters approved the District on December 20, 1984, and the Valley County Commissioners officially established it the following day. Its boundaries closely match those of the McCall-Donnelly School District. Under Idaho law (Idaho Statute 39-1331), the Hospital District Board is responsible for acquiring and managing property, entering into contracts, and overseeing improvements. The District’s bylaws define its purpose as supporting public health and providing necessary medical care, including the construction, maintenance, and improvement of public hospitals.

Between 2005 and 2010, the Hospital District Board, like many rural hospital boards in Idaho and across the country, faced increasing challenges in sustaining full-service local healthcare. These included limited financial resources, workforce shortages, and aging facilities.

To help secure long-term healthcare services for the community, the Board began discussions with St. Luke’s about joining its health system. Community members strongly supported this step: in an advisory vote, 86% of voters approved the relationship and supported keeping the Hospital District in place. This relationship was formalized through a Healthcare Services Agreement, under which St. Luke’s McCall took responsibility for healthcare operations and services, and the Hospital District’s assets, facilities, and equipment were transferred to St. Luke’s McCall.

In 2016, the Idaho Attorney General raised concerns about how that asset transfer had been structured. After a year of work together, the Hospital District and St. Luke’s signed a revised Healthcare Services Agreement. This updated agreement returned ownership of the assets and facilities to the Hospital District and confirmed that the District alone has the authority to decide whether to levy taxes. At the same time, it preserved the central purpose of the relationship: maintaining high-quality, comprehensive healthcare services and facilities for the community.

The Hospital District and St. Luke’s also entered into a Lease Option Agreement which helps support long-term investment in local healthcare. In simple terms, St. Luke’s leases the hospital facilities from the District and, instead of making traditional rent payments alone, much of its “rent” is fulfilled through direct investment in McCall’s healthcare system. These investments include major improvements such as the construction of the new expanded hospital, upgraded equipment, and other capital projects that strengthen patient care locally.

As St. Luke’s continues making these investments, their value is tracked over time. Once those investments reach a certain amount, St. Luke’s earns the option to acquire specific assets, such as hospital buildings and equipment, under the terms of the agreement. St. Luke’s investment in McCall has already surpassed that required threshold, demonstrating a substantial long-term commitment to sustaining and improving healthcare services for this community.