I had occasion earlier this month to spend a day with over a hundred representatives of Catholic health systems. I had been invited to give a talk to the Illinois Catholic Health Association on the topic of religious liberty. What I came away with from that meeting, however, was a heightened sense of how intricately complicated Catholic hospitals and systems have become.
Stand-alone hospitals have little chance of surviving. Thus, a huge wave of consolidation of hospitals is occuring. Reimbursement challenges, spiraling health costs and a slow economic recovery are driving this new wave of hospital consolidations. Hospital mergers and acquisitions can increase market share, cut reduplications and gain new possibilities for negotiating leverage with commercial payers. They also significantly lower medical costs. There has also been an expansion of health insurance companies into direct healthcare services. At present, some 60 percent of hospitals are non-profit, 25 percent are government owned and operated. Fifteen percent are for-profit systems (and they are growing). Today, Catholic hospitals (there are 629 Catholic hospitals and some 56 different Catholic hospital systems) represent around 12 percent of all hospitals. One in six Americans receives treatment each year in a Catholic hospital.
Some Catholic hospital systems are fairly large. The largest, Ascension Health, operates 61 acute care hospitals, 4 long term acute care facilities and 4 rehabilitation hospitals. Catholic Health East operates 35 hospitals; Catholic Health Initiatives runs 77 facilities; Providence Health operates 34 hospitals; Trinity Health has 44 and Wheaton-Franciscan Health operates 16. Catholic hospitals are generally well-placed to acquire, engage in a merger or a joint operating agreement with other, secular, not for profit systems. The Catholic church is far and away the single largest provider of not-for-profit health care in the country.
There are a number of questions about maintaining and monitoring the Catholic identity of a given hospital or system. The bishops have promulgated ethical and religious directives for Catholic Health care ( ERDS). These preclude elective abortion, in vitro fertilization, stem cell research using embryonic stem cell material and direct sterilizations. When a Catholic health system absorbs what had, previously, been a secular non-profit hospital or hospital system, it, generally, asks the newly merged hospital also to abide by rules which preclude abortion, in vitro fertilization and sterilizations. This has caused lawsuits and complaints about a Catholic acquisition of a secular, non-profit hospital, over the issue of a reduction of reproductive services for a region or rural area. There have been some horror stories of women in rural communities, undergoing a miscarriage, being denied abortions to save the life of the mother or save her womb from serious infection. In one documented case in Arizona, a woman was sent by a taxi to the nearest medical institution 90 minutes away, at risk of hemorrhaging and infection and significant emotional distress.
Many women who have had several caesarian section births opt for a tubal ligation to fend off further operations that endanger their womb and their health. These are not generally possible in a Catholic hospital or in many of the secular, non-profit, hospitals taken over by a Catholic hospital system. (An online organization closely monitor such mergers, mainly involving Catholic hospitals). The Governor of Kentucky blocked a proposed merger of a Louisville Public hospital with a Catholic system because it would limit reproductive services for the region.
Some forms of mergers or joint operations have found some solutions to the availability of various forms of reproductive care. When a secular hospital in Kingston, New York merged with a Catholic institution, in effect reducing the community's hospitals from three to two, administrators of the secular hospital set up a separate maternity unit in the parking lot. It provides a full range of reproductive services, including abortions. In Troy, New York, leaders of a newly merged Catholic-secular hospital came up with a different solution. The maternity unit operates on the second floor as an alternative "hospital within the hospital"—complete with its own financial operations. Besides direct acquisition and mergers of hospitals, some systems opt for a non-merger active parent affiliation, such as one finds between Saint Joseph's Hospital in Baltimore and the University of Maryland Medical System or between Providence Health and Swedish hospital in Seattle.
Not all the mergers have been of secular, non-profit smaller hospitals with larger Catholic systems. Thus, Caritas Christi Catholic hospital system was taken over and sold to a for-profit health system in Massachusetts, Steward Health Care. St. Joseph's hospital in Atlanta is now under the majority ownership of Emory University Health. In each case the Catholic hospitals are still bound to the ERDS. Attempts are made to have a board structure which respects the Catholic nature of the subordinate Catholic facility. Some mergers are also fought because they will represent a reduction of competition in health care in an area. Earlier this year, Catholic Health Care West severed its formal ties to the Catholic Church and renamed itself Dignity Health. It has twenty-five Catholic hospitals, still bound to the ERDS and fifteen secular, non-profit hospitals. Part of its reason for severing its ties to the church was to facilitate further mergers and acquisitions of smaller, secular, non-profit hospitals.
By and large, state law demands of non-profit hospitals that they engage in 4 to 8 percent of a case load which is charity-based or free or reduced cost care for the indigent. For-profit systems do not need to carry this burden. Non-proftis also are assumed to take into greater account the very communities they are located in and serve. But some Catholic hospitals have been taken over by for-profit systems. St. Vincent Hospital in Worcester, Massachusetts has been a for-profit hospital for fifteen years. Ascension Health has a for-profit affiliate organization, Ascension Health Care Network. Whether a for-profit structure can continue the ideals of Catholic hospitals to care for the weakest and neediest is, for me, a pressing question mark.
There is no doubt that there is also an increasingly hostile public health establishment, inimical to Catholic values concerning abortion, embryonic stem-cell research, in vitro fertilization and sterilization. According to the Kaiser Family Foundation, 46 percent of all employer sponsored health insurance firms offer abortion coverage; 87 percent cover sterilization services and 86 percent offer full contraceptive coverage. In most instances, the employee-based plans pay for services by organizing a network of preferred hospitals and physicians to whom they send their employees and families for care. To stay in business, Catholic hospitals and physicians need to be able to see patients covered by such plans, which puts an added pressure on them.
As one author, Jonathan Coh, put it in a New Republic article earlier this year, "Unholy Alliance": "For better or worse, the government depends on Catholic hospitals to provide vital services—and the hospitals depend on the government for money to provide them. Convoluted solutions may be the only way for this convoluted mix of public purpose and private institutions to survive." Whether a secular elite hostile to Catholic positions on reproduction or our bishops can find their way to creative, if "convoluted," solutions is not yet clear to me. But without expansion and further mergers, the presently healthy Catholic hospital system might find itself in jeopardy. What a loss that would be!
John A. Coleman, S.J.