Margie Schaps' Testimony on the Takeover of West Suburban Medical Center and Westlake Hospital

Testimony delivered this morning by HMPRG Executive Director Margie Schaps, at a public hearing of the Illinois Health Facilities and Services Review Board on the takeover of West Suburban Medical Center and Westlake Hospital by the for-profit corporation Vanguard.

Health and Medicine Policy Research Group

Testimony before the Illinois Health Facilities and Services Review Board

 

Re: Vanguard Health Systems applications to acquire West Suburban Medical Center (10-014) and Westlake Hospital (10-013)

My name is Margie Schaps.  I am the Executive Director of the Health and Medicine Policy Research Group. I also was a member of the state task force that met throughout 2008 to revise and recreate the Illinois Health Facilities and Services Review Board (formerly the Illinois Health Facilities Planning Board).

 

Our organization has a number of serious concerns regarding the applications for change of ownership.  We urge the Board to set as a condition of the permit a requirement that Vanguard Health Systems maintain and operate Westlake Hospital and West Suburban Medical Center for a minimum of ten years.  While this condition would not mitigate all of our concerns, it would address the most serious: ensuring continued provision of medical services to residents in the services areas, particularly residents with very limited alternatives for care.

 

For almost 30 years, Health and Medicine has operated as an independent, non-profit center driven by a singular mission: formulating health policy, advocacy and health systems to enhance the health of the public.  The reason for our focus is obvious.  America’s vast dysfunctional health care system has lurched from crisis to crisis.  Demand for services is growing as a result of our aging population while spending on public sector health care services has declined. 

 

In the last several years, the Cook County Bureau of Health Services has suffered unprecedented budget cuts, causing clinic closures, significant reduction of services and long waits for prescriptions and appointments for non-urgent procedures.  At the same time, the health care safety net across the Chicago region is deteriorating as fewer hospitals struggle to serve an ever-increasing number of people in need. As the federal health reform unfolds over the next several years, the need for community-based health services that people can count on, will be even greater.

 

 

In this context, Resurrection Health Care’s plan to sell Westlake and West Suburban hospitals to for-profit Vanguard Health Systems raises several serious questions.

 

If West Suburban and Westlake hospitals do not generate sufficient profits, will Vanguard close the hospitals or certain services such as the maternity or emergency departments? 

Some years ago Vanguard purchased Phoenix Memorial Hospital, which served several low-income communities.  Residents were assured that the “mission and heritage” of Phoenix Memorial would continue under new management.  Within a year, Vanguard attempted to close the hospital’s emergency room.  In response, two elected officials in Phoenix pressed Vanguard Health Systems to help defray the projected $1.5 million it would have cost the three urgent-care clinics run by Maricopa County if they had to expand their hours to try to make up for the loss of the emergency department.  

 

Vanguard halted its plans for closing the ER but several years later closed the hospital entirely and leased out the space.  During that same period, Vanguard was investing significantly in its hospital located Paradise Valley, an affluent suburb of Phoenix.

 

Similarly, after acquiring Louis A. Weiss Memorial Hospital located here in Chicago in partnership with the University of Chicago, Vanguard closed the OB/GYN department.  Not surprisingly, these cases have added to the concerns of residents in the West Suburban and Westlake hospitals’ service areas.

 

Unfortunately, Vanguard has not chosen to address those concerns by providing a long-term commitment to maintain and operate the hospitals.  While Vanguard has recently announced that it would keep Detroit Medical Center hospitals open for at least ten years, the corporation has only committed to operating Westlake and West Suburban for two years – less than the three years stipulated in the Board rules regarding change of ownership.

 

Has Resurrection Health Care behaved responsibly to the communities that rely on West Suburban and Westlake hospitals?

In the applications to the Board for change of ownership there is no indication that Resurrection actively pursued a nonprofit purchaser for these hospitals.  The purchase agreement references consideration of several alternatives but apparently the Resurrection Board chose not contact any of the financially viable health care networks here in Chicago or nationally. 

 

 

Also of note in these applications is the very modest sale price for the two hospitals – less than half the value set for the hospitals when they were purchased by Resurrection.  Given the very low price negotiated, it would seem that Resurrection could have at least secured a serious commitment to the future operation of Westlake and West Suburban.

 

 

How would closure or change in services at these two hospitals impact residents in the service areas?

This question cannot be answered until there is consensus and clarity on a health plan for the region.  A central feature of the revised Illinois Health Facilities Planning Act is the creation of the Center for Comprehensive Health Planning, empowered to create such a plan over the next several years.  The Board is required to make decisions consistent with the findings of the Comprehensive Health Plan.  By requiring Vanguard to commit to maintaining services at West Suburban and Westlake hospitals for ten years, the Board will be taking a responsible step to ensure that the hospital does not close prior to a comprehensive evaluation of the health care needs in the area.

 

Thank you for your consideration.