August 4, 2014

Blue Springs and south KC eye hospital deal

Blue Springs Mayor Carson Ross said he hopes the sale of St. Mary’s Medical Center will bring stability to a hospital that has lost some doctor groups while an earlier deal was pending. Kansas City Councilman John Sharp hopes the transition to a for-profit hospital won’t compromise charitable care.

The pending sale of St. Joseph Medical Center in south Kansas City and St. Mary’s Medical Center in Blue Springs is bringing a mix of hope and uncertainty to both areas.

The hospitals’ owner, Carondelet Health, said last week that it had signed a letter of intent to sell the hospitals to Prime Healthcare Services Inc. Kansas City-based Carondelet is part of St. Louis-based Catholic health care system Ascension Health.

Carondelet had been trying to sell the hospitals and some related facilities for at least two years. Former suitor HCA Health Midwest System failed to seal a deal earlier this year when it seemed unlikely that federal regulators would approve it because HCA would’ve become too big a force in Kansas City’s hospital market.

In Blue Springs, a possible sale of St. Mary’s has been discussed for a number of years, said Blue Springs Chamber of Commerce President Lara Vermillion.

“It’s been a concern for quite some time to make sure there’s a buyer and it remains as a community hospital,” Vermillion said.

“It’s important to the community that it doesn’t stay empty, that it doesn’t close.”

A potential purchase by HCA had been particularly worrisome in Blue Springs because St. Mary’s is close to two existing HCA Health Midwest hospitals — Centerpoint Medical Center in Independence and Lee’s Summit Medical Center.

Even before official negotiations were announced wth HCA, hundreds of Blue Springs citizens launched a public relations campaign to keep St. Mary’s open in the event of an HCA purchase.

But in the Kansas City area, Prime Healthcare owns only Providence Medical Center in Kansas City, Kan., and St. John Hospital in Leavenworth.

Blue Springs Mayor Carson Ross called St. Mary’s “a good community partner” and said that’s what the community is looking for, regardless of who owns the hospital.

“We have suffered in the past few years while HCA was looking to buy,” Ross said. “We had physician groups leave the hospital because of the pending transaction.

“I hope it gets done quickly so we can have some stability.”

St. Mary’s also serves Grain Valley, Oak Grove, Odessa and Concordia, and it’s important to those communities, too, Ross said.

“It’s about Blue Springs and beyond,” he said. “We take a lot of pride in having the hospital.”

Grain Valley Mayor Mike Todd said in a statement that city officials were happy about the pending sale.

“Prime Healthcare Services has a strong, established history of purchasing financially struggling hospitals and turning them around,” Todd said.

However, Grain Valley Chamber of Commerce President Jeff Coleman said the pending sale has been generating a lot of worries.

“There are so many unknowns,” he said.

St. Joseph Medical Center hugs the state line just east of Interstate 435. Kansas City Councilman John Sharp called it “a great asset to south Kansas City.”

“I’m always concerned when nonprofit hospitals are acquired by for-profit corporations,” said Sharp, whose 6th City Council District includes the hospital.

“Nonprofit hospitals are required to provide a greater amount of charitable care for their tax-exempt status than for-profit hospitals are,” Sharp said. “So it’s always a concern about whether for-profits provide as much of that kind of care. Oftentimes, they don’t.”

Sharp also said “potential patients want to be assured that there won’t be drastic cuts in staffing,” which could affect the quality of care.

Vickie Wolgast, president of the South Kansas City Chamber of Commerce, said that whether the sale goes through or not, “the hospital will still be here and it will still provide good care for its patients.”

The South Kansas City Alliance, a coalition that promotes the area, said in a statement that it initially saw no downside for the area from the sale of St. Joseph.

“Our primary concerns are that the hospital continues to at least sustain current employment levels, or add more jobs,” the organization said. “We also hope that Carondelet Health will incorporate some safeguards into the transaction to make sure patients, many of whom live in our community, continue to get quality healthcare — along with a follow up reporting method to ensure proper billing practices.”

Federal investigators have looked into Prime Healthcare’s billing practices. A former company executive filed a federal whistleblower suit against the chain, claiming Medicare overbilling. Prime responded in a statement, calling the allegations “speculative nonsense.”

Prime Healthcare, based in Ontario, Calif., owns and operates 27 hospitals in seven states.

St. Joseph is licensed for 310 beds and operates 180 of them, and it employs 1,160. St. Mary’s is licensed for 146 beds, staffs 80 of them and employs 548.

Another 174 employees serve both hospitals.

A 2013 report by the market research company HealthLeaders InterStudy stated that Carondelet Health held about 7 percent of the Kansas City hospital market.

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