ST. PETERSBURG — In its annual report to City Hall last June, Bayfront Health St. Petersburg painted a bright self-portrait of a thriving corporate citizen, here to "serve the community."
While patient admissions to the hospital were down, the amount spent on charity care was up.
Bayfront had spent more than $100 million since 2013 on facility upgrades, and soon planned to cut ribbons for an expanded trauma center and other improvements, including a satellite emergency department in Pinellas Park.
The for-profit hospital, which sits on public land, also boasted of close collaboration with two big names: the University of South Florida's medical school and neighboring Johns Hopkins All Children's Hospital.
A lot has happened since then, much of it not good. And as Bayfront Health prepares to deliver this year's update to its landlords at City Hall, some officials are signaling that they don't fully trust the corporate leaders now in charge of St. Petersburg's oldest and largest hospital.
PREVIOUS COVERAGE: Two top leaders resign from Bayfront Health St. Petersburg
The trouble spilled out in public over several months.
Late last year, prompted by reports in the Tampa Bay Times of infant deaths and other problems at the All Children's heart institute, top leaders at that hospital were removed. The resulting blow to All Children's' reputation has rubbed off on Bayfront Health St. Petersburg, causing many parents to avoid its labor and delivery department, according to Bayfront's regional president and interim CEO Joe Mullany.
Mullany, who was hired last year to oversee the Bayfront Health chain of hospitals along the Gulf Coast, took over leadership of the St. Petersburg hospital in mid-February after the sudden and unexplained resignations of CEO John McLain and chief financial officer Pamela Modisett.
The shake-up followed another setback — an announcement two weeks earlier that USF was cutting ties with Bayfront Health St. Petersburg. The 3-year-old partnership never really worked out, Dan Vukmer, a senior associate vice president at USF Health, said at the time.
He referred to Community Health Systems, Bayfront Health's Nashville-based corporate parent, saying their goal was "selling off hospitals," and USF was looking for "a more permanent partner."
In the course of those events, the hospital confirmed it had laid off 19 administrative and clerical employees over the previous six months.
Concerned by the string of negative news, City Council members asked Mullany to come and brief them.
He failed to show for a March 7 appointment after canceling a requested meeting with city officials on Feb. 24.
When he appeared in council chambers on March 14, some city officials, already irritated, were jarred by Mullany's rosy report. Its contents contrasted sharply with the recent news of layoffs, resignations and partnerships gone bad.
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"We're in heavy investment, heavy growth but a lot of challenges," he said, calling Bayfront's recent wins "spectacular."
He told them the hospital actually had hired 430 employees since October, and he brushed aside the news of layoffs, saying the 19 positions were "re-engineered" out of the organization.
"I do not like the characterization 'layoffs,'" Mullany said. "There have been no layoffs. … In the realm of health care, things do change."
He also told the council that the recent split between Bayfront and the USF medical school was not permanent, and that an agreement having to do with "branding, education and some other things" was still in place.
He added: "We're very positive on USF. … We would love to see that relationship not only continue but actually expand."
That was news to Vukmer, the USF official. "I have not heard directly from Mr. Mullany about this, so this is a surprise to me," he told the Times.
After Mullany's appearance before the council, city officials strained to make sense of his comments, particularly the claim of 430 new employees, which sounded improbable to some.
"The report he gave to the City Council is the first time I had heard that number," Deputy Mayor Kanika Tomalin said in an interview.
She added that "there seems to be a disconnect" between Mullany's portrayal of Bayfront and accounts the city has received from patients and former employees who have "expressed concerns" about the hospital.
Tomalin did not elaborate.
City Council member Darden Rice described Mullany's 18-minute presentation as "curt" and took note that he did not show when initially scheduled.
"It felt a little like we were being managed," she said. "The overall impression was that he addressed and understood the issues we were concerned about, but I feel like we should trust him, but verify."
She said it would behoove the city to check Mullany's numbers on new hires.
At the meeting, the CEO attributed the spike in employment to several factors, including an increase in patients, added staff for Bayfront's new stand-alone emergency department in Pinellas Park and using staff instead of contractors for some work.
The hospital, through spokesman David Larrick, later provided the Times with more detail on the numbers. It put the number of new hires at 440 since October. Of those, 109 were described as newly created jobs while the rest were hired to fill vacancies.
Mullany said the hospital still had more than 100 job openings to fill.
Last June, McLain, the former CEO, reported that the hospital employed a total 1,745 people in St. Petersburg. As of January, according to Larrick, the staff numbered 1,799 — just 54 more people than last year.
It is unclear where the 440 hires cited by the hospital fit into that overall total. But Larrick said the positions fell across multiple departments, from primary care to nurse residency, cardiology and emergency.
Mullany's presentation did not touch on charity care, Bayfront Health's commitment to caring for St. Petersburg's uninsured and underinsured residents as a designated safety net hospital.
But council member Steve Kornell said it remains "a top priority and concern" to the city.
In 2013, when the former Bayfront Medical Center was sold to a for-profit chain, Health Management Associates, the council instituted a clause in the lease that required the new owners to continue to treat all patients with incomes below 200 percent of the federal poverty level, regardless of their ability to pay.
But the agreement never specified a minimum amount of charity care the hospital would have to provide. The next year, the hospital was sold to Community Health Systems, also a for-profit chain.
"We heard some slick comments about the stability of the hospital but not much about their commitment to caring for our most vulnerable citizens," Kornell said of Mullany's recent presentation. "That seems to be a gray area."
The amount Bayfront spends on charity care has varied in recent years. After dropping from $63 million to $49 million between 2012 to 2015, it rose to $73.1 million in 2017, the latest figure available.
By comparison, St. Anthony's Hospital on the other side of downtown has steadily increased its charity care in recent years, from $14.1 million in 2015 to $20.5 million last year. St. Anthony's is owned by the nonprofit BayCare health system.
Bayfront Health St. Petersburg is part of a seven-hospital network along Florida's Gulf Coast, spanning from Venice to Crystal River. It's parent, CHS, is one of the nation's largest owners and operators of hospitals, with 137 of them in 21 states. But it has struggled financially in recent years, posting heavy net losses and selling dozens of under-performing hospitals.
Among them was Bayfront Health Dade City, which was sold last year to AdventHealth.
Earlier this year, Bayfront Health St. Petersburg celebrated the opening of its renovated and expanded Level 2 trauma center connected to its emergency room. It was the first of several phases in a $22 million upgrade.
Last year, the hospital renovated its neurology and orthopedic floors, and construction is ongoing to double the footprint of the emergency department with all private rooms.
When City Council member Ed Montanari reminded Mullany that he would need to return soon to give an annual report, as outlined in the lease agreement, the CEO said, "I did not know that, but I would love to."
City officials have him on their calendar for June 6.
Contact Justine Griffin at firstname.lastname@example.org or (727) 893-8467. Follow @SunBizGriffin.