Wilmington health care group seeks partner
The loss of DHL is expected to stress health care system that is already seeing an increase in 'charity care.'
Sunday, January 11, 2009
Officials of CMH Regional Health System and associated Clinton Memorial Hospital in Wilmington are concerned about how the upcoming DHL freight hub shutdown will affect the availability of health care insurance, when the amount of charity health care has already been increasing.
So, on Dec. 8, CMH issued a 38-page request asking larger hospital networks from Dayton to Columbus to Cincinnati to consider affiliating with CMH. The Clinton County-owned network includes a cancer treatment center and doctors' offices in the county.
Small community hospitals lack the financial resources of regional health care networks. The smaller hospitals also can benefit by contracts the larger networks may hold with health insurers that set reimbursement rates for medical services, said Andy Riddell, CMH's chief executive officer in Wilmington.
The responses from health networks, including Kettering Health Network, Premier Health Partners, TriHealth in Cincinnati and OhioHealth in Columbus, are due back to CMH by Jan. 23.
Riddell said that charity care — a shorthand reference to unreimbursed care and service to Medicare and Medicare patients — is approaching 60 percent of CMH's total annual revenues of $104 million, Riddell said. Bad debt has increased from $4 million to $6 million annually since he became CMH's chief executive in April 2007, he said.
"You just don't create working capital out of that, because you're providing care at cost — or less, as in free care," Riddell said.
Express shipper DHL plans to close its U.S. freight hub at Wilmington after this month, wiping out an estimated 7,000 or so jobs at the region's major employer. DHL has said it is paying up to $260 million for severance pay, retention bonuses and interim health care benefits to the affected employees. But those will eventually run out, and the regional impact still isn't known, Riddell said.
"The issues they're facing are no different than any of the hospitals are facing," Bryan Bucklew, president and CEO of the Greater Dayton Area Hospital Association, said of CMH. He acknowledged that the problems could be more acute for small community hospitals.
The region's hospital networks have occasionally affiliated with smaller hospitals. Kettering Health Network affiliated with Greene Memorial Hospital, Xenia, at the start of 2008 and with Grandview Medical Center, Dayton, in 1999. Premier Health Partners affiliated most recently with Upper Valley Medical Center in Miami County.
The Kettering network is evaluating CMH's request and expects to respond to it, said Russ Wetherell, Kettering's chief financial officer.
No decision has been made on whether to affiliate with CMH, Wetherell said.