Keep the health care promises
The 2003 sale of the former Health Midwest hospital network to the out-of-town Hospital Corp. of America was a drawn-out, contentious process.
Thirteen hospitals in the Kansas City region were involved, and people understandably worried that the transfer of nonprofit community assets to a for-profit owner would result in weakened connections and diminished charity care.
Based on a judge’s ruling this week, those concerns were well-founded.
Jackson County Circuit Judge John Torrence awarded a $162 million judgment against HCA to the Health Care Foundation of Greater Kansas City. The foundation contended the for-profit hospital owner failed to pay for capital improvements to the former Health Midwest hospitals, as it had agreed to in the terms of the sale, and also may have dodged its full commitment to help with charitable care.
Though HCA says it plans to appeal the ruling, the Health Care Foundation, which was created under the terms of the sale, deserves congratulations for its vigilence. Its board and staff never took their eyes off a core principle spelled out in the transaction — that the community as a whole, and indigent patients in particular, should not be abandoned.
Under the sale agreement, Health Midwest, which changed its name to Community Health Group in 2003, was intended to be the front-line watchdog to see that HCA met its obligations. Unfortunately, the legal case so far suggests it has been ineffective in that role. That may also be so of the Missouri and Kansas attorney general offices, which reviewed the Community Health Group’s work annually. In future complex agreements of this sort, care should be taken to create more of a separation between the designated watchdogs and the people being watched.
A Kansas foundation also created by the sale, Reach Healthcare Foundation, disappointingly declined to join the Health Care Foundation in its legal action.
The trend in health care is toward consolidation. We are likely to see more mergers and sales in which large, out-of-town corporate entities gain control over what are intended to be community assets. Sound agreements, and the sort of vigilance that the Health Care Foundation has provided, are essential going foward.
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