...don't even ignore 'em.
-- Samuel Goldwyn

Tuesday, August 09, 2005

Hospital Biz.

In the city of Yakima, Washington, where I have a home and family, one of the two hospitals was bought a year or so ago by HMA, an NYSE company, based in Florida, that owns 57 hospitals in small or "non-urban" communities, and which did about $900 million in business in the quarter ending June 30, pulling $98 million in income out of that. The hospital they bought was formerly non-profit, founded by the Sisters of Providence about a hundred years ago. It was struggling, as was the Providence organization.

HMA went through the place with a chainsaw. Providence was already having management problems, but HMA created many more, and complaints piled up. Then, earlier this year, all the ER docs quit, quite publicly, saying the place wasn't safe and they wouldn't stay. All of them. HMA said it was a negotiating ploy and called them, in effect, money-grubbers. There's much more, and the Yakima Herald Republic has been reporting the story well, including this wrapup in today's paper.

You couldn't find a better example of totally botched community relations. HMA misread the situation and thought they could split the medical community by crowing about how profitable they've made the hospital, now called Yakima Regional. But the doctors and the state health inspectors say HMA has downgraded the quality of the hospital.

Yakima's medical community works, and HMA is going to have to work with it if they're going to stay. The issue this example perfectly addresses, for me, is whether a strictly-business approach is appropriate in health care and medicine.

In Yakima, an almost perfect-sized community, coming on as an aggressive, combative competitor, against only one well-run non-profit hospital that is highly regarded by community and medical professionals, doesn't seem to me the smartest business decision. The HMA local manager has mainly patronized everybody: "Change is hard..." he regularly intones, suggesting that those who oppose him are foolish geezers. But this blowoff line only works when the change being imposed is an improvement. HMA is only fooling itself. Profitability isn't enough of a change in health care, and Yakima knows the difference.

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