WARNING: The assault on Connecticut’s Hospitals – Here come the for-profit hospital operators

For decades, even centuries, Connecticut’s regional non-profit hospitals have been one of its greatest assets.  Emergency rooms, maternity programs, and access to local, high-quality hospital care have made our communities better, safer and healthier places to live and raise a family.

While improvements to the quality of care and the reduction of hospital medical errors have become a major concern across the nation, the notion of local, non-profit, comprehensive hospitals are the healthcare and economic backbone of many Connecticut communities.

But Governor Dannel “Dan” Malloy’s unprecedented cuts to Connecticut’s non-profit hospitals and his outrageous support for the for-profit hospital industry is already leading to the worst possible outcome.

The truth is that over the past two years, the Malloy administration has cut hospital funding by over $400 million and these cuts have led to layoffs and reduced services at numerous Connecticut hospitals.

The cuts have also left a number of smaller hospitals teetering on the edge of bankruptcy.

But worst of all, while undermining the funding of Connecticut’s non-profit hospitals, Malloy has also quietly opened the door and ushered in the for-profit hospital industry to our state.

Take the dire fiscal problems facing many hospitals, introduce the “profit motive,” and we’ll now be seeing the type of healthcare system that Malloy’s policies have created.

As recently reported by Connecticut media outlets, the for-profit Tenet Healthcare Corporation is already moving to purchase St. Mary’s Hospital in Waterbury, as well as, Waterbury’s other hospital.  Those of us in Eastern Connecticut know that Tenet is also making a play for hospitals east of the river.

For those who don’t know, Tenet Healthcare Corporation is the $12 billion national hospital operator that employs over 100,000 people and brags that they are, “a leading healthcare services company, through its subsidiaries operates 79 hospitals, 193 outpatient centers and Conifer Health Solutions, a leader in business process solutions for healthcare providers serving more than 700 hospital and other clients nationwide.”

As Tenant arrives in Connecticut, residents should be aware of the following information provided by Wikipedia,

  • In 2003, Tenet sold or closed 14 hospitals and closed more than 20 facilities in 2004 to achieve its financial performance goals.  Also in 2004, Tenet also moved its headquarters from Santa Barbara, CA to Dallas, TX.
  • In June 2006, Tenet agreed to pay $725 million in cash and give up $175 million in Medicare payments for a total of $900 million in fees to resolve claims it defrauded the federal government for over-billing Medicare claims.
  • In 2007, Tenet appointed former Florida governor Jeb Bush to its board of directors to improve its reputation.
  • In December 2011, the non-partisan organization Public Campaign criticized Tenet Healthcare for spending $3.43 million on lobbying and not paying any taxes during 2008-2010, instead getting $48 million in tax rebates, despite making a profit of $415 million, and increasing executive pay by 19% to $24 million in 2010 for its top 5 executives.
  • In April 2012, Tenet agreed to pay $42.75 million to resolve allegations that it improperly billed Medicare between 2005 and 2007.  

And the list goes on and on…

But as the CT Mirror reported earlier this week in an article entitled, St. Mary’s Hospital to be acquired by Tenet

St. Mary’s Hospital in Waterbury announced plans Tuesday to be acquired by Dallas-based Tenet Healthcare Corporation, a national for-profit hospital chain that’s already in the process of purchasing hospitals in Bristol, Vernon, Manchester and Waterbury.

St. Mary’s had been considering corporate suitors for several years. A previous deal to join forces with a different for-profit company and Waterbury Hospital fell apart two years ago over concerns about providing reproductive services and the rules St. Mary’s operates under as a Catholic hospital.

Although Tenet is also in the process of acquiring Waterbury Hospital, the deal announced Tuesday would leave each hospital in the city separate. Both would convert from nonprofit to for-profit.

[…]

Legislation passed this yearcrafted with Tenet’s other pending transactions in mind, changed state law to make it easier for non-profit hospitals to convert to for-profits.

So the when it comes to Connecticut’s hospitals, Malloy’s legacy is (1) record cuts and (2) making it easier for for-profit hospital chains to gobble up Connecticut’s hospitals.

Hardly the policies that Connecticut needs or deserves.

And why would Malloy push such detrimental policies on Connecticut?

One need only check out the Tenant Healthcare Corporation’s “corporate policies” which include the following:

We believe that it is important to participate in political, legislative and regulatory processes on issues that affect Tenet’s business and community interests, and are committed to doing so in a way that is consistent with our values, our legal obligations, and our Standards of Conduct…

  • buygoldandprosper

    Remember the book, FIVE DAYS AT MEMORIAL, by Sheri Fink?

    Tenet Health Care at its finest!

    “Families of patients who died”… (murdered?)… “sued the company over the actions of officials at Memorial Medical Center in August 2005. At least 34 patients died at the hospital after the hurricane knocked out power and the temperature inside the building rose to more than 100 degrees Fahrenheit (38 degrees Celsius). The hospital’s windows couldn’t be opened.”
    Read the book, folks. It is an eye opener.

  • Castles Burning

    So so sad. Who is leading or part of the anti-profit hospitals movement? Would there be any hope of an intervention or is it already too late?

  • Willow

    Malloy cut all hospitals including a for profit hospital in Sharon, CT the only sacred hospital sparred cuts was UCONN. The amount cut to hospitals was $550,000 million not $400,000 million. Finally, the Governor has not been quiet about any of this has the author of this blog Jonathan Pelto been listening and reading.

  • ctdevilsadvocate

    Jonathan I agree about the cuts to hospitals Malloy made. But the problems these small and middle sized hospitals had with access to capital began well before the cuts.

    The simple fact is that even without the cuts, these small hospitals were struggling to find the cash to improve facilities. For better or worse, for-profit companies such as Tenet have access to capital.
    A for-profit bought Sharon in 2002 and the results have been fine. It was either sell to Essent or close. Which would you have chosen? What is your prescription for access to capital for CT’s struggling small hospitals?