by Roxie Hazard, Certified Radiologic Technologist
Is Sutter Health a not for profit charity, or just a secretive "for
profit" corporation in disguise? Read more and decide for yourself . .
.
This
article investigates the workings of Sutter Health Corporation, a
multibillion dollar California healthcare company which has transitioned
from its former role as manager of community owned hospitals, to its
new role as controlling entity of multi-hospital corporations. Why is
this important? Because Sutter now charges 60% more than the statewide
average for healthcare. If you have health insurance of any kind, or
you have ever been treated at a Sutter facility, Sutter Health's pricing
power impacts you. The following is my experience with Sutter Health,
as a former employee of Sutter Coast Hospital ("SCH"), a locally owned
community hospital for which Sutter Health is the manager.
It's been just about a
year since the online report of Sutter's self-funded $170,000
"independent" Strategic Options Study on the future of SCH. Sutter
muted the telephone lines so participants could not hear each other's
questions during the internet presentation. "The Study" was followed by
an extensive radio and newspaper advertising campaign. Ironically,
after two years of Sutter executives denying they were considering
downsizing the hospital to a Critical Access facility, the Sutter funded
"Study" reported the best option was to convert to Critical Access
Hospital. That means more money for Sutter Health--triple the amount which SCH is now able to charge to Medicare. Go figure.
The highlights of our local on-going hospital controversy:
2011: the hospital Board deliberately excluded our community
from its decision to "Regionalize" SCH (transfer hospital ownership to a
SF Bay Area corporation controlled by Sutter Health). Community outcry
forced Sutter to hold up the transfer of ownership.
2012: County Board of Supervisors requested the hospital Board release its meeting minutes and financial data. Sutter refused. Today, Sutter continues to refuse.
2012: The
Del Norte Triplicate prints the following quote: "Meanwhile, another
local doctor serving on the hospital's Board of Directors has called
regionalization "a merger that may save the hospital" from financial
ruin and closure."[1]
2013: The headline article in the Curry Coastal Pilot reads: "CEO: Sutter Coast Hospital losing money."[2]
2013: Hospital Interim CEO announced Critical Access designation is "not being discussed." (Note that later in 2013, the hospital Board voted to downsize the hospital to a Critical Access facility).
2014:
According to members of a City/County/Healthcare District committee,
Sutter Health's Regional CEO claims Sutter Coast Hospital turned
profitable in 2014. Really? The Critical Access application has not been approved yet! I thought the hospital needed to Regionalize and downsize in order to stay afloat. Now we learn that's not true!
As an employee of
Sutter for over 16 years, I watched Sutter morph from manager of three
local community hospitals striving to become the "employer of choice" in
Sacramento to a powerful, monied, extremely successful business
machine. While they frequently speak of their "not-for- profit
mission," Sutter's actions seem more about enhancing profits. Ask
Pat Fry, Sutter President and CEO -- it was Sutter's "enhancing profits
mission" that made his 53% wage increase possible in 2012!
Sutter's list of
attorneys, executives and consultants are proven capable to ensure
whatever Mother Sutter wants, Mother Sutter gets. If Sutter was a
private, for-profit corporation, we'd all be impressed. BUT, Sutter
Health and SCH are not-for-profit corporations. Their income is based
on billions in tax exempt bonds and tax-free operations. According to
the IRS tax code, Sutter is required to operate for tax-exempt
(charitable) purposes, not to the benefit of any individual. It would
seem Mr. Fry's salary increase, from $2.3 million to $6.4 million
between 2007 and 2012, may be inconsistent with a charitable, tax-exempt
purpose.
Last month, Sutter
Health announced a new corporate structure plan that will collapse five
existing Regional corporations into two Divisional corporations in
2015. Here's a quote from Sutter about the new structure: "Within
this new design, we emphasize the total patient experience; how we
present externally facing products to our customers; innovation, data
and analytics; and a stronger discipline in driving change across our
Sutter Health network." Who knows what that means? I don't. Perhaps it's "Sutter Speak" for "we plan to have even greater monopoly power across our network."
Sutter still holds closed
Board meetings, refuses to release meeting notes or financial data,
spends hundreds of thousands of tax-exempt dollars on self-funded
"independent" studies and advertising campaigns, charges 60% more than
average, pays its executives millions, makes conflicting statements,
operated SCH in violation of California law, and pays no taxes to the
communities it serves.
So what do you think?
Is "We Plus You," just "Smoke Plus Mirrors" from a not-for-profit
acting like a for-profit? I think it is. But even more distressing is
that our hospital Board continues to discount or acknowledge questions
and concerns from over 4,000 area residents . . . friends, neighbors and
patients of SCH.
It's time to end Sutter's secrecy and restore fair market prices to Sutter's facilities. If you would like to join this effort, please write me at roxiehazard@charter.net
If you would like
to join our city and county leaders, which have already asked the
California Attorney General to investigate Sutter Health, please ask the
Attorney General to investigate Sutter by writing to:
The Honorable Kamala Harris
Office of the Attorney General, Antitrust Division
300 So. Spring St., Los Angeles, CA 90013
Please forward this article to friends, and post on social media sites.
Working together, something very good could come of all this.
Roxie Hazard, CRT
Crescent City
Portions of this article were originally published in The Del Norte Triplicate, available online at http://www.triplicate.com/
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