NewsLocal NewsInvestigations

Actions

The Rebound: Recovering from a pandemic after years of hospital growth and ownership consolidation

Posted: 6:44 PM, May 07, 2020
Updated: 2020-05-08 15:58:40-04
Hospital Consolidation

CLEVELAND — In a pandemic, healthcare workers are heroes, risking their lives to protect ours. Since early March, hospitals around the country have been in crisis mode trying to stop COVID-19. But other things at hospitals stopped, too, like elective procedures and routine doctor visits costing hospital systems billions of dollars.

A lesser publicized side-effect of the coronavirus has been its crippling effect on hospitals, leaving behind unintended consequences like healthcare worker furloughs and emergency rooms closing their doors.

As hospitals begin to rebound, how are decisions made years ago shaping the future of healthcare?

20 years of change

“We were a teaching hospital,” said Dr. Robert Haynie who worked at Mt. Sinai Hospital in Cleveland for 22 years.

The hospital was sold and closed in 2000.

Dr. Robert Haynie, former employee of Mt. Sinai hospital

“I came to the hospital and there was all the news channels,” recalled Dr. Haynie. “And we’re told we got two weeks.”

Looking back to the year 2000, there were 42 hospitals in Northeast Ohio according to a registry of the Cleveland Hospital Association. Those hospitals had 30 different owners.

Scroll over the graphic to see the different hospitals and ownership groups back 20 years ago:

In the coming years, five other hospitals would close including St. Luke’s and Huron Hospitals. Other community hospitals bearing names of suburbs like Parma Community General, Lakewood Hospital, and Euclid Hospital were taken over and repurposed.

Over the past two decades, the hospital landscape dramatically shifted as there was an ownership arms race between Cleveland Clinic and University Hospitals.

Today, Cleveland Clinic, UH, and Summa own 66% of the hospitals that were listed in 2000.

The largest hospital systems would continue to grow and build further into the suburbs, across the country and the globe, while further increasing their market shares in Northeast Ohio.

Despite all of the change, Dr. Haynie told us he doesn’t think patients are worse off today.

“I don’t think we’ve had a drop-off in quality,” he said. “In fact, I don’t think you can get better healthcare anywhere in the world than in Cleveland.”

Some aren't convinced

However, longtime Lyndhurst resident Franco Foti, 67, told us he doesn’t see the benefits. “I just don’t want to pay for things that are ridiculous charges,” he said.

Foti told us consolidation is forcing him to pay more since doctors offices are being absorbed into health systems or hospitals and now they’re collecting facility fees.

Patient Franco Foti expresses concern over facility fees

“Now the whole thing is considered a hospital, but (my doctor’s) office has not changed,” explained Foti. “I’m still going (to the same office) I was going before except, instead of being charged…$200, $300, $400, now I’m getting charged $1500, $2000 plus.”

“People really are worried about our healthcare system and they’re unhappy about it,” said Dr. Martin Gaynor from Carnegie Mellon University, who has studied hospital consolidations for the past 40 years and testified in front of Congress.

Dr. Martin Gaynor
Dr. Martin Gaynor testifying at congressional hearings about hospital consolidation

“Prices are high and rising. There are egregious pricing practices,” he told U.S. Congress members about a year ago in Washington, D.C.

“This massive consolidation in healthcare has not delivered for Americans,” he told the committee. “It has not given us better care or increased efficiency.”

Quality questioned?

Dr. Gaynor told us in the past 20 years there have been more than 1,600 hospital consolidations around the country. He disagrees with Dr. Haynie about the caliber of care.

“When there are mergers, between close competitors… the quality actually deteriorates,” he said.

He pointed to a study of heart attack patients on Medicare. “People who had heart attacks and were treated at hospitals that faced a lot less potential competition, did a lot worse in terms of their mortality,” explained Dr. Gaynor.

Dr. Haynie did tell us there are still unacceptable infant mortality and longevity rates in Cleveland.

“In fact, in Fairfax where I do a lot of community outreach, it’s more like a 2nd or 3rd world country,” he explained.

Dr. Gaynor reports consolidations, in general, bring lack of competition, lack of options for patients, and lack of appointment times available.

Size as a strength

But, the hospitals see their size as a strength.

A spokesperson for the Cleveland Clinic wrote the following in response to Dr. Gaynor's concerns about growth "We know that high volume medical centers can produce better outcomes for many procedures and more effectively and efficiently provide care.”

"Operating as a hospital system we’re able to leverage shared resources and efficiencies. Without sufficient scale, it is difficult to address future healthcare initiatives such as access, infrastructure, sophisticated HIT, affordability/costs, insurance plan coverage and more." -- Cleveland Clinic

(for the Cleveland Clinic's complete statement, see below)

A spokesperson for University Hospitals echoed those sentiments:

"University Hospitals has been able to bring to bear the expertise and assets of our academic medical center, 18 hospitals and more than 50 outpatient facilities in caring for communities across Northeast Ohio. Community hospitals that chose to join the UH system have benefited from multi-million dollar investments to enhance facilities and equipment and expand access to highest-quality specialty care close to home." - University Hospitals

(for University Hospitals complete statement, see below)

COVID-19 Impact

Now, the worst case scenario hits: coronavirus.

Hospitals suffered major losses when non-essential procedures and treatments were postponed or canceled. The financial burden was thrust upon the big three hospital systems in Cleveland instead of spreading it out among many ownership groups.

The Ohio Hospital Association says hospitals across the state are losing more than $1.34 billion per month.

The losses may only heighten the need for what some already deem as overly aggressive collection practices by non-profit hospitals like the Clinic and UH.

“There are reports of non-profit hospitals going after people who couldn’t afford to pay,” said Dr. Gaynor.

Suing Patients

Claudia Simpkins, 73, from Cleveland who was sued in 2019 after she couldn’t pay for her one-night stay at Cleveland Clinic.

“I got a bill from them (for) $26,000,” Simpkins told us.

Claudia Simpkins
Patient sued by hospital over unpaid bill

“How do you feel about them coming after you for this money?” we asked.

“I don’t feel it’s right,” she answered.

A quick search of the Cuyahoga County courts shows there have been lots of Cleveland Clinic lawsuits against patients like Simpkins.

So, we went directly to Cleveland Clinic CEO Dr. Tom Mihaljevic.

Tom Mihaljevic, MD, CEO Cleveland Clinic

“As the leader (of Cleveland Clinic), what would you say to the patients who are looking at these and facing these lawsuits from your clinic?” we asked.

“To communicate with us,” said Dr. Mihalievic. “To approach the Clinic. Often times these things can be resolved through communication.”

Wake up call?

In a world now upended and hospitals just now starting to reopen more services, Dr. Gaynor said maybe COVID-19 can be a wake-up call.

“And we’ll come out the other side (of the Coronavirus) determined to figure out what’s the best thing to do about our healthcare system so it really works for all of us,” said Dr. Gaynor.

Here is Cleveland Clinic’s full statement:

“Our ultimate goal is to improve the overall health of the communities we serve. We continue to grow so that we can care for more patients and improve their outcomes. By sharing best practices and standardized care over a broader landscape, the care we deliver across all locations is consistent.
We know that high volume medical centers can produce better outcomes for many procedures, and more effectively and efficiently provide care across a whole spectrum of services.
At the same time, we know there is no one-size-fits-all approach to healthcare. Each of our locations has a culture, and each community we serve has unique needs. Acknowledging this diversity makes Cleveland Clinic stronger and able to adapt to change.
As hospitals have joined the Cleveland Clinic health system, their quality and safety have consistently improved. Akron General and Union Hospital, two hospitals that joined within the last few years, received an “A” in the most recently published safety grades by the Leapfrog Group—a national nonprofit organization that measures the quality and safety of American healthcare.
Operating as a hospital system we’re able to leverage shared resources and efficiencies. Without sufficient scale, it is difficult to address future healthcare initiatives such as access, infrastructure, sophisticated HIT, affordability/costs, insurance plan coverage and more.”

Here is UH’s statement:

“The COVID pandemic has highlighted an important benefit that results from having a comprehensive and coordinated network of hospitals working together as a unified system. University Hospitals has been able to bring to bear the expertise and assets of our academic medical center, 18 hospitals and more than 50 outpatient facilities in caring for communities across Northeast Ohio.
Community hospitals that chose to join the UH system have benefitted from multi-million dollar investments to enhance facilities and equipment and expand access to highest-quality specialty care close to home, such as services delivered by the UH Seidman Cancer Center and the UH Harrington Heart and Vascular Institute.
As a health system, UH is able to deliver care more efficiently. In serving Medicare and Medicaid patients, UH works as a responsible partner with the state and federal governments to seek ways of lowering costs while improving quality of care.
At UH, all patients are treated with respect, regardless of their individual financial circumstances, and no one is denied or delayed emergency or medically necessary care because of his or her inability to pay for services. If patients meet established financial eligibility requirements, their bill for emergency medical or medically necessary care at a UH hospital facility may be discounted under the UH Financial Assistance Program. More information on billing and insurance services at UH can be found: https://www.uhhospitals.org/patients-and-visitors/billing-insurance-and-medical-records[uhhospitals.org]”