Tacoma’s two biggest hospitals earned about $1,000 more per patient in 2010 than the state average, according to an analysis by the state’s largest consumer advocacy group.
MultiCare Health System responded in a statement Tuesday, saying that while it was still reviewing the analysis, it believes the report contains “considerable distortion of a limited set of inpatient hospital data.”
Franciscan Health System, in its statement, echoed those points and said the data analysis was done by a labor union with which it is in “protracted contract talks.”
Washington Community Action Network, based in Seattle, released the 16-page report this week. It accuses MultiCare and Franciscan health systems of not doing enough to ensure Pierce County residents have access to more affordable care while accumulating more profit than other hospitals in Washington.
Washington CAN has 35,000 members statewide and advocates for economic fairness and social justice. Its analysis of Pierce County’s two largest private employers uses a variety of public data, including information submitted by the health systems themselves to the state Department of Health and analyzed by SEIU Healthcare 1199NW. The SEIU analysis is the basis of the most serious accusations of profit-hoarding.
SEIU used “a metric derived from Washington Department of Health data to compare hospitals” to find a “profit per unit of service, which represents individual patient encounters.” It then analyzed the largest revenue-generating hospital within each system – Franciscan’s St. Joseph Medical Center and MultiCare’s Tacoma General-Allenmore hospitals.
In 2010, Washington CAN said, St. Joe posted profits of $1,543 per patient and TG-Allenmore posted profits of $1,167 per patient.
“During the same period,” according to its news release, “the statewide average was $468 PPU and the average for King County hospitals was $851 PPU. The average for Kitsap County hospitals was $635 PPU; for Thurston County hospitals it was $836 PPU; and for Snohomish County hospitals it was $506 PPU.”
Marce Edwards, MultiCare spokeswoman, said in the statement that the data report isn’t adequate to judge MultiCare’s community impact.
“MultiCare provides many other health care services, including home health and hospice, primary care and urgent care, behavioral health and more than 90 community services programs that are not reflected in these numbers,” she wrote.
Gale Robinette, Franciscan spokesman, said in Franciscan’s written statement that the report “appears to distort inpatient data that was obtained from the Washington State Department of Health and draws inaccurate conclusions from it.”
Franciscan’s statement also questions the timing.
“We note that it is sponsored by SEIU, a labor union with which we are currently involved in protracted contract talks at St. Joseph Medical Center in Tacoma and St. Clare Hospital in Lakewood.”
SEIU Healthcare 1199NW represents about 1,200 of Franciscan’s licensed practical nurses, service workers and technical workers, and between 600-800 service and technical workers at MultiCare’s Good Samaritan Hospital.
Edwards said Tuesday that contract negotiations at Good Samaritan have been going on since August, and those workers have been without a contract since it expired Oct. 1.
“Talks have been nonproductive, and there are several key issues upon which we can’t agree,” she said, declining to elaborate.
“Of course we are bargaining,” said Linnae Riesen, SEIU 1199NW spokeswoman, when asked if the report was an attempt to influence those talks. “But this was intended to raise questions to the broader community. It should raise an alarm.
“They’ve been floating these narrative that times are tough,” she said, referring to MultiCare’s layoffs last year and recent debates over the health systems’ tax-exempt status. “That’s what raises an eyebrow here. The CEOs are making millions of dollars in annual compensation. There’s no doubt they provide health care to the community. What should be called out is, are they doing everything they can?”
The report offers theories about why MultiCare’s and Franciscan’s profits would be so much higher, concluding that keeping expenses low, treating high volumes of patients and treating sicker patients who garner more third-party reimbursement isn’t enough to account for it. The report then floats a fourth theory – that the hospitals charge more for services – while saying that publicly available data can’t confirm or refute that.
Washington CAN ends its report with a question: What do Franciscan and MultiCare do with their enormous profits?
Both systems point out that they’re nonprofit organizations and don’t even use the term “profit.” They said they reinvest all income above expenses, called their “operating margin,” back into community services.
Both statements listed several recent capital projects, such as new emergency rooms and hospitals, as well as health and wellness programs.
Riesen said the systems’ clearly benefit the community as they are the county’s top two private employers. The question is, are they doing enough?
“Buildings aren’t just what provides care. Can people access it? Can they afford it?” she said.
Kathleen Cooper: 253-597-8546