Monday, March 10, 2014

Healthy choice

Community Medical Center pushed toward St. Pat's deal

Posted By on Mon, Mar 10, 2014 at 2:40 PM

Community Medical Center has spent the last six months delicately preparing staff, major donors and the general public for significant changes at the Missoula hospital. As the nonprofit’s search for a “partnering initiative” nears its end, major stakeholders are angling to influence the board of directors’ decision while others are frustrated with the lack of transparency and public involvement throughout the process. That frustration only rises amid speculation that Community’s options include Billings Clinic, an existing affiliate through its gynecologic surgery and electronic health records programs, and Providence Health & Services, the parent company of Missoula’s only other—and larger—hospital, St. Patrick.

“This is a decision that impacts every patient in Missoula, every resident, but it’s being decided by a select group of suits behind a closed door,” said one independent physician with privileges at both Community and St. Pat’s, who requested anonymity due to the sensitive nature of the negotiations. “I don’t know if going with St. Pat’s is the best move or not, but I think that’s something the Missoula community should have an opportunity to talk about.”

Steve Carlson, Community’s chief operating officer, announced in an Aug. 15 letter to staff that the hospital hired a national financial advisory firm, Cain Brothers, to help identify and evaluate options as it adjusted to “market forces and legislative mandates for change.” Those options included remaining an independent nonprofit or “pursuing an affiliation with a regional or national system.” In October, Community eliminated 20 positions and furloughed additional workers in an effort to cut $3 million in costs. On Feb. 18, Carlson and Board Chair Scott Stearns released a letter stating the hospital had identified “several solutions now under consideration that offer us the opportunity to become part of a larger organization.” The letter added that “no final decisions have been made,” but assured the board is “committed to making the very best decisions on behalf of our community.” A separate Feb. 27 letter sent to major donors and signed by Foundation Chair Barry Kenfield specified that a partner decision will be made “within the next 60 days.”

“Non-disclosure agreements have been signed with any and all potential partners, so no potential partners can be identified,” said Mary Windecker, Community’s vice president of planning and marketing.

While none of Community’s public releases has solicited public or staff input, local groups are positioning themselves to make their opinions known. The Independent received one letter addressed to the Community board on behalf of independent physicians advocating for a partnership with St. Patrick Hospital.

Community Medical Center

“Your choice of a partner is an important matter that cannot be overstated and has significant consequences for all of us,” it states. “...We believe that the unity of hospitals will increase [health care] quality and will help to improve Missoula as the center of healthcare excellence. The economic benefits for the entire community cannot be overlooked.

“We believe that the division of the Missoula medical community will have an opposite and disastrous result,” the two-page letter continues. “... If Community Medical Center and St. Patrick Hospital cannot establish a partnership, the attributes of both hospitals will be compromised.”

The Independent received the same letter from two different physicians, one of whom said he agreed to sign it. The other said he was undecided. When asked if the physicians knew whether St. Pat’s was a realistic partner for Community one responded, “It’s what’s always made the most sense to a lot of people. It’s kind of the worst kept secret around the halls that they’ve been exploring this from the start.”

Windecker said she was unaware of the physicians’ letter, but added that “any comments are always taken to the Board.”

The Montana Nurses Association, which represents employees at Community, St. Pat’s and Billings Clinic, said Carlson notified staff of “acquisition discussions” but its members have not been informed of any specific partner possibilities nor been asked to weigh in on the process.

“The Montana Nurses Association will continue to focus on representation of all registered nurse members who have collective bargaining agreements in place at both facilities,” said Lori Chovanak, referring to St. Pat’s and Community, in an emailed statement. “We will continue to prioritize supporting each nurse in their work environment so that they can provide the quality care necessary to contribute to optimal patient outcomes. Additionally, we will maintain our respectful relationship with both facilities.”

Community Medical Center admits nearly 6,000 patients each year and employs more than 1,100 people with an annual payroll of over $38 million. Its medical staff includes 300 physicians. Community offers the only obstetrical and newborn care in Missoula County, and it’s the only hospital in western Montana that provides pediatric specialty and pediatric intensive care services.

The nonprofit reports total patient revenue at $237 million but it’s one of many facilities across the country struggling to adjust to an evolving health care system. One of the major challenges facing Community involves changes to Medicare and Medicaid, the government’s health insurance programs for seniors and the poor. A proposal in the 2013 Montana Legislature to expand Medicaid failed. As a result of these challenges, Moody’s Investors Service recently downgraded the outlook on Community Medical Center’s bond rating on $24.9 million of outstanding debt to “negative.”

It’s unclear how Community’s partnership with or acquisition by a larger organization would impact staff or patients. Cain Brothers, the firm hired by Community to help it through this process, brokered a deal between two East Coast nonprofit health care entities last month, which brought Adventist Health Care’s Hackettstown Regional Medical Center in northwest New Jersey under the control of Atlantic Health System for $54 million. Hackettstown has 111 acute-care beds. Community, by comparison, has 146.

Among Community’s options, a merger with Providence and St. Patrick Hospital has generated the most discussion. A Catholic institution, St. Pat’s is Missoula’s second largest employer with approximately 1,773 employees, but announced in November its own financial challenges and a restructuring plan to cut $5 million.

“There’s an argument to be made for combining resources, sure, but there are also a lot of questions about what it means to basically eliminate competition and patient choice,” said another local physician with privileges at both hospitals.

Calls and emails to St. Pat’s requesting comment were not returned.

Billings Clinic, also a nonprofit, includes three branch clinics as well as five primary or specialty-care clinics in Montana and Wyoming. Community partnered with Billings Clinic on its OBGYN oncology program beginning in 2009, and more recently collaborated on its electronic health records system.

“Billings Clinic has several relationships with Community Medical Center,” said Jim Duncan, president of the Billings Clinic Foundation & Community Relations. He referred any questions about Community’s search for a partner and Billings Clinic’s role in that process to the Missoula hospital.

With no additional information coming from Community, local leaders are concerned with how such a significant decision will ultimately impact staff, patients and the city’s overall level of health care.

“You know, honestly, I don’t know much about it. Apparently there is not much transparency if I don’t know anything about it,” said Missoula City Councilman Jon Wilkins, who chairs the Public Safety and Health Committee. “I think people should know about what is going on, and they should be allowed to put their input in if it affects their life … I run the Public Safety Committee and I have heard not one word on any of this. I would like to know how this affects the people that live in Missoula.”

Additional reporting by Jimmy Tobias.

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