Hospital deals in New York, Michigan, Tennessee and Georgia

The New York Times: Lenox Hill, a "boutique hospital of choice for the rich" announced Wednesday "that after 153 years as a standalone hospital on the Upper East Side, it was entering a partnership with North Shore-Long Island Jewish Health System, a powerhouse of 15 hospitals and other health care centers in more humble parts of Long Island, Queens and Staten Island." Lenox Hill is expected to lose $15 million this year, and "joining a bigger health care system provides a way out of financial trouble. For North Shore-Long Island Jewish, it offers a toehold in Manhattan and access to wealthy, well-connected patients."

But "some experts questioned whether there was a need to save Lenox Hill. Its patients and physicians could easily have been absorbed by nearby hospitals, including Mount Sinai Medical Center, NYU Langone Medical Center and NewYork-Presbyterian Hospital, industry analysts said" (Hartocollis, 5/19).

NPR, on an acquisition in Michigan: "A few weeks ago, officials with the Detroit Medical Center, the city's largest health system, made an announcement that was as startling as it was welcome: that they intended to sell the nonprofit to an investor-owned company. As part of the deal, Nashville-based Vanguard Health Systems promised to spend $850 million on much-needed capital improvements." The deal would be a welcome investment for a struggling city, but it is also met "with a healthy dose of skepticism by those who study such deals. Without selling hospitals, turning away needy patients or cutting services, experts say they don't see how Vanguard will get a good return on its investment" (Ovshinsky, 5/20). 

Chattanooga Times Free Press: Meanwhile, legislators in Tennessee and Georgia have passed a new hospital fee plans to "to bring millions of dollars in federal Medicaid funding into the states." Most hospitals in both states "will pitch in a percentage of their net patient revenues to stave off deep cuts to both states' Medicaid programs. … The money generated from the hospital fees will be used to draw down federal matching Medicaid funding" and will help "save hospitals from proposed across-the-board cuts that would have driven some hospitals out of business, supporters say. … Likely only 10 or 15 hospitals out of 154 in Tennessee will end up contributing more through the fee than they ultimately will get back through TennCare payments, said Craig Becker, president of the Tennessee Hospital Association" (Bregel, 5/20).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.