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Scott launches study of public hospitals’ costs

Saying he wants taxpayers to get their money’s worth in health care, Gov. Rick Scott issued an executive order late Wednesday appointing a commission to scrutinize the performance and costs of hospitals operated by local governments.

His Commission on Review of Taxpayer Funded Hospital Districts has nine months to study whether it is in the public’s best interest to have government entities operating hospitals at all.

Beyond that, the panel is to look for the most effective model of providing health-care access for poor people.

“We're spending a lot of tax dollars to do this and I want to make sure that the dollars are spent well,” Scott said at an appearance this afternoon at the Capitol. “Are we getting return for those dollars? Is it helping us with reducing the costs of health care?

Business groups immediately praised Scott’s action. As chair, Scott appointed Dominic Calabro, president and CEO of Florida TaxWatch, an independent group that looks for ways to save money.

The commission will discover that public hospitals tend to provide good value, said Tony Carvalho, president of the Safety Net Hospital Alliance of Florida, a group that includes public and non-profit teaching hospitals.

They have to, he said, because they are required to prove their worth each year to elected officials or to the taxpayers directly.

“I certainly welcome any review of their operations and efficiencies …and the benefit their communities receive,” he said.

The order immediately brings to mind financially ailing Jackson Memorial, the nation’s third largest public hospital. But a search on the Florida Hospital Association web site indicates there are 33 publicly owned hospitals in the state, not counting the VA and state-owned institutions.

And they don’t look much alike.

“No two of them are the same,” said Linda Quick, president of the South Florida Hospital and Healthcare Association. “To come up with a position that would apply to all of them is going to be difficult if not impossible.”

Some are owned by county or city governments, while others are operated by independent elected bodies that have taxing authority.

Some public hospitals – notably Lee Memorial Health System in southwest Florida – don’t even get local tax revenue, while some taxing districts distribute money to hospitals without owning or operating them.

Consider the difference between Jackson Memorial and suburban Coral Springs Medical Center. One of four hospitals in the public Broward Health system, Coral Springs has a lower percentage of indigent patients than many private hospitals, including some for-profits.

The recommendations in the executive order track those made by Scott’s transition team for health and human services following the election. Its chair, Alan Levine, said Wednesday night that Scott has “put forth a thoughtful process” for answering the questions that crop up every year on how to distribute money for care of indigent uninsured patients.

The process always ends up in a “food fight,” said Levine, who is now a regional president for Health Management Associates, an investor-owned hospital chain. The governor’s commission is a better way to go about it, he said.

Wading into the dispute on what hospitals are paid is bound to remind Floridians that Scott resigned under fire in 1997 as CEO of the Columbia/HCA hospital chain, which he led for 10 years, after it became public knowledge that it was under federal investigation for Medicare fraud.

The company eventually paid $1.7 billion in civil fines, but Scott was never charged with criminal wrongdoing. He has said he didn’t knowingly participate in fraud but admitted he should have paid more attention to billing.
 

--David Royse of News Service of Florida contributed to this report. Carol Gentry, Editor of Health News Florida, can be reached at 727-410-3266 or by e-mail. Letters to the Editor are welcome.