Prime Healthcare is not the Solution to Hospital Woes

FOR-PROFIT OWNER FAVORS HEALTH CARE IF YOU HAVE THE MONEY
The inclusion of Prime Healthcare into the San Leandro Hospital equation may have larger ramification on the sick and infirm than the loss of the hospital.

The for-profit health care provider located in Southern California and owned by an eccentric cardiologist named Dr. Prem Reddy seems intent on following a tried and true pattern of gobbling up small, cash-strapped hospitals and stripping down costs to make them profitable. In the past seven years, Prime has purchased 13 hospitals in the state.

In many ways, Prime is an example of national health care policy gone wild. Reddy told the Los Angeles Times two years ago the medical field is a commodity like any other that is sold to the highest bidder.

“Why is it in health care we expect to have the same?” Reddy said, It’s an entitlement mentality. Why aren’t the same people asking why everybody shouldn’t be eating the same foods, or have the same clothes or same homes? Those are as essential services as health care.”

Prime typically enters a new market portraying itself as the savior willing to keep the existing hospital running. According to the Daily Review, part of Prime’s proposal will be to honor the current collective bargaining agreement, but in an era of immense public distrust in corporate greed and honesty, critics say the hospital chain is known to slash up to 10 percent of staff as they vowed last year after purchasing hospitals in Garden Grove and San Dimas.

To make the large profits it seeks, Prime’s modus operandi is to strip the new asset of services that fail to make substantial earnings such as chemotherapy and birthing centers. A main source of Prime’s profitability is a reputation for nullifying contracts with insurance companies that, in some cases, reduces their profits by 30 percent in return for the insurance carrier to keep the flow of business steady. By voiding this arrangement, a health care provider like Prime can reap larger profits from the carrier and make up the difference by utilizing expanded emergency room hours. Prime has also shown a propensity for favoring patients with problems that may necessitate longer hospital stays which translate into even bigger earnings.

The story of Prime’s acquisition of Paradise Valley Hospital last year in National City, near San Diego and 10-miles from the Mexican border, could be instructive to what may happen in San Leandro.

The 100-year-0ld hospital run as a charity by Adventist said the facility was hemorrhaging in debt and would need to be closed if a credible buyer did not reveal itself. Prime Healthcare was that Good Samaritan. What ensued was a roiling debate that pitted doctor against doctor, accusations of the faith-based owner of hiding behind religion and tugging at local fears of losing a hospital.

Not many of these aspects differ from what is occurring in San Leandro. The failure of the county to recognize a link between the building of a new hospital in Castro Valley to the possible closing of one in San Leandro has pitted doctors and nurses against each other while stoking jealousy between neighboring communities. In addition, the anxiety among older residents is high with the window of the next few years having fewer hospital services in the area while Kaiser Permanente constructs a new complex on Merced Street and the likely Sutter Medical Center in Castro Valley is built.

Prime’s ability to swoop into a situation and dictate the terms of its perception could be on display tonight when the Eden Township District discloses Sutter’s plan to turn over the hospital to Alameda County. The reported presence of officials from Prime, despite not listed on the agenda, raises the possibility the health care provider plans to portray itself as the cure of all that ails San Leandro. In reality, the sick and poor may have to pay more than ever before to line the pockets of a health care provider to retain their hospital. Sadly, that’s the cost of doing business.

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