Contract talks break down between Pinellas County and hospitals serving the poor

For most of the last decade, a group of Pinellas County hospitals has agreed to a losing proposition. In exchange for caring for the thousands of poor and uninsured patients referred to them by the county, they accepted small reimbursements that covered a fraction of their costs.

It was charity care supported by the theory that if the hospitals treated patients in the county's health plan, which serves people who have almost no income and don't get Medicaid, it would lower their emergency room costs. And for years, most of those patients sought treatment at two of the biggest names in indigent care in Pinellas: Bayfront Medical Center and the BayCare Health System.

But after a period of relative harmony, negotiations over the hospitals' reimbursement rates have broken down amid a dispute over which hospitals are caring for most of the county's poor, and how much they're being paid to do it.

New data collected by the Pinellas County Health and Community Service Department suggests that in the last year, Bayfront, a former nonprofit that is now owned by for-profit Community Health Systems Inc. and is called Bayfront Health St. Petersburg, has experienced a major decrease in the number of low-income, county-referred patients in its care.

Meanwhile, BayCare, which has four hospitals in the county's health plan, has seen its numbers climb to the point where it is now performing 94 percent of the total procedures.

Several years ago, the numbers did not look this lopsided.

The county's analysis shows that in fiscal year 2011, Bayfront performed 900 procedures on the patients sent there through the health plan. Two years later, after Bayfront moved to for-profit ownership, first with Health Management Associates and now with Tennessee-based CHS, the number of procedures dropped to 285. Meanwhile, the overall number of people enrolled in the health plan has risen each year, and now stands at 10,000.

Bayfront's leaders dispute these figures, which show its share of procedures on county-referred patients has fallen to 6 percent from 20 percent in 2011.

"There's no way that can be accurate," said Eric Smith, Bayfront's chief financial officer.

Smith said the number of procedures shown in the county's data is roughly equal to the number of patients enrolled in Pinellas' health plan that the hospital sees in a two-month period. Most likely, each of those patients received multiple procedures, which can range from a CAT scan to a biopsy.

"Our number is significantly higher," he said, estimating that Bayfront performed close to 900 procedures last year, a figure that, if correct, would suggest that the hospital's approach to care for the poor hasn't been altered in the midst of its ownership change.

The disagreement between Bayfront and the county has bled into negotiations over the reimbursement rates.

For the past several years, the county has split $3 million in property tax revenues almost evenly between Bayfront and BayCare, which operates St. Anthony's, Morton Plant, Mease-Countryside and Mease-Dunedin hospitals. Florida Hospital North Pinellas, a Tarpon Springs nonprofit, receives a minuscule sum. Until 2011, when it dropped out of the county's health plan, the for-profit chain HCA — which runs five Pinellas hospitals — also got a share of the funds.

But now that it appears that BayCare is shouldering a majority of the burden, county officials have agreed to increase its funding. The hospital network has signed a contract for $2.6 million this year, more than doubling the $1.1 million it got last year.

Offered $360,000, Bayfront has refused to sign a new contract, as has Florida Hospital, which was allocated $30,000, a small fraction of the cost it incurs by treating patients in the Pinellas health plan.

"What we're asking for is to work with the county to negotiate a more equitable reimbursement," said Paul Hoover, North Florida's vice president of business development.

Said Bayfront's Smith: "We want to participate in the program. Our intent is to work something out."

In a worst-case scenario, if both Bayfront and North Florida walked away from the program, too, BayCare hospitals would be left wholly responsible for treating the county's health plan enrollees, at significant expense.

"If the other providers chose not to participate, could BayCare absorb all that and the financial implications of that?" wondered Glenn Waters, president of BayCare's hospital division. "That's a huge burden, and there are more hospitals in Pinellas than just us."

Contract talks break down between Pinellas County and hospitals serving the poor 03/15/14 [Last modified: Saturday, March 15, 2014 8:01pm]

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