Phil Mella 
Member since Dec 20, 2011

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Re: “Memorial: Health makes wealth

Mr. Hazlehurst's breezy analysis belies the complexity of weighing the differences between a non-profit academic entity such as UCH and a pro-profit entity with out-of-state corporate offices and the need to maintain a strong P/E ratio.

To begin, when previously asked whether they would guarantee indigent care, HCA responded they would---for ten years. What then? The sub-text, which doesn't take a K Streeter to parse, is that it would be subject to cuts.

Memorial's pediatric neurosurgery program is critical, but the demographics make it impossible to maintain profitability; what would HCA do with that service line? The list goes on, but suffice it to say that corportate governance from afar typically erodes local control, which can and often does, flout the will of the people.

This is less a criticism of HCA, which successfully runs six hospitals Colorado, than it is a comment on what the Springs citizens made unambiguously clear in the recent year-long, 54 public meeting process (which, astonishingly, was deemed insufficient by some politicians, since it didn't reach their preferred conclusion): Local control is paramount.

A year ago it might have been possible to argue that Memorial should become a local non-profit, but the system has struggled with respect to market share. Under those changed circumstances, the option that best respects the will of the people is UCH.

It has the advantage of strong leveraging capabilities relative to contracts as well as capital acquisitions. It will also afford the system a meaningful voice in its operational management, something that is highly unlikely with HCA.

HCA's allure is clearly the siren song of cash. And, that's where politics inevitably distorts incentives and can confound the will of the people. Unlike all other city enterprises, it's arguable that a hospital system, which provides the most life-critical services we citizens will every need, should provide services based on community needs, not exclusively based on whether each service line is profitable. That's something to think about if your child ever needs special services or if you need care but are unable to pay for it.

Finally, those on council who would have preferred the upfront $500 million HCA offered convincingly make the case that retail health care shouldn't be under the auspices of a municipality.

3 likes, 0 dislikes
Posted by Phil Mella on 12/20/2011 at 10:20 AM

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