Wednesday, March 23, 2016

Metro General seeks $7.5M more, on top of a recent $10M more, on top of the budgeted $33.5M subsidy.

Metro's money pit known as Metro General hospital is seeking an additional $7.5 million dollars on top of the $10 million it received two months ago.  Is there no end!

Metro does not even have to be in the hospital business and should get out of it,  just as we got out of the nursing home business last year when the city privatized Bordeaux Long-term Care and Knowles Home Assisted Living and Adult Day Services, saving the city $10.5 million a year.

Many years ago there was a need for local governments to provide charity hospitals and many cities did. As healthcare changed and low income people no longer had to go to the charity hospitals but could go to the hospital of their choice, the justification for such safety net hospitals went away, but with government slow to change, many cities continued their funding of charity hospitals as did Nashville. Overtime other changes occurred which made General even less viable, such as more people being treated as outpatients rather than being admitted into hospitals and length of stay in hospitals being shortened.

Metro General Hospital opened as the City Hospital on April 23, 1890 as Nashville’s first full-service hospital. In 1891 the hospital started a school of nursing and in 1913 it opened a pediatric ward. The hospital grew and flourished until after World War II when admissions began declining. As more hospitals opened in Nashville customers had more choice. St. Thomas opened in 1898 and then Baptist Hospital, first known as the Protestant Hospital, opened in 1917. Park View, which was the first in what was to became a chain of hospitals known as HCA, opened in the mid 1960’s. Vanderbilt Hospital opened in the 1970’s and there have been numerous expansion and additions of other hospitals since then.

Not only did more choice mean less demand for General, but when Medicare and Medicaid were signed into law in 1965 that meant that low income people could go to any hospital and not depend on city charity. By the 1990’s General was facing a crisis. Not only did low income people have choice, but General, dependent on Metro’s level of funding, did not have the resources to acquire the latest in technology and equipment. Also the building, by this time a hundred years old, was in need of rebuilding or major rehabilitation.

Maharry Medical College was also facing a financial crisis in the late 1980’s and early 1990’s. In an effort to help both institutions, in October 1991 Nashville approved of a plan to merge the Meharry Hospital with Metro General. The merger phased out services at the Metro General Hospital site on the bluffs of the Cumberland, now known as “Rolling Mill Hill,” and relocated services to Meharry-Hubbard hospital. General Hospital became the teaching hospital for Meharry Medical School and metro heavily subsidized the 116-bed facility.

General has had a difficult time competing with the many other hospitals in the area despite Metro’s generous subsidy, although the subsidy is not as generous as it was when the merger first occurred. Last year Metro’s subsidy was $33.5 million and then an additional $10 was appropriated two months ago.  Despite Metro’s continued subsidy of the hospital, the hospital struggles to attract patients. All Metro prisoners are treated at Mehary-General and Metro employees are given an advantageous deal if they will use Meharry, and yet still the hospital struggles.

In 2012 the city commissioned a study of Meharry-General conducted by the firm of Alvarez and Marsal. The study found that as currently operating Meharry General was not sustainable. One thing plaguing meharry is that it cannot fill its beds. They only have an occupancy rate to about 42%, but even if they operated at full capacity they would have a per patient loss per day of $1,602. The per patient loss is higher with fewer patients, but the overall loss would be greater with more patients.

The consultants offered a range of options for addressing the situation, ranging  from “maintaining the status quo to re-purposing the hospital as an ambulatory care facility with reduced inpatient services to a full scale re-design of the business model focused entirely on outpatient and clinical service.”

Last year Metro spun off its nursing homes and saved the city $10.5 million a year. A city owned nursing home is as about as archaic as a city poor farm, yet ending metro’s ownership and operation of a nursing home was not without its opponents and yet the city did it. Even Megan Barry voted to privatize Boudreaux and Knowles.

Running for office last year Megan Barry, as did all of the mayoral candidates, pledged to continue supporting Meharry. This speaks more to the influence of the Black vote than any rational reason to continue supporting Meharry.  I find it very disappointing that among a 40-member council there is not a single council member who will stand up and speak the truth, and that is, that a city charity hospital is not mandatory nor needed and Metro needs to get out of the hospital business. 

The read The Tennessean report on this development see  Metro General Hospital seeks $7.5M to pay late bills.

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