NCH plans to sue over HMA hospital approval

"This is just a letter to preserve our right to appeal," said Edward Morton, chief executive officer of NCH.

The hospital system has 70 days to file the actual appeal documents, said Debbie Curry, spokeswoman for the hospital system.

At issue is how much medical care HMA's proposed Collier Regional Medical Center would provide in terms of charity care to the indigent and to the poor on Medicaid. The state Agency for Health Care Administration approved the hospital's license on the condition that a minimum of 2 percent of its total patient volume involve treating charity patients and a minimum of 10.1 percent must involve treating Medicaid patients.

NCH officials say that's not a fair share, given that 5.4 percent of patient volume in fiscal 2002 at NCH's hospitals involved charity patients and Medicaid patients account for 10 percent of patient volume.

HMA received final license approval Oct. 6 for its proposed $75 million hospital, to be built on 60 acres near the southeast intersection of Collier Boulevard and Rattlesnake Hammock Road. That approval came after NCH had sought to have preliminary approval of the new hospital, granted in June 2002, overturned through an administrative hearing. An administrative judge this past spring sided with state health regulators that another hospital is justified in fast-growing Collier.

If HMA were to agree to sign a legally enforceable agreement to provide its fair share of charity and Medicaid care to the needy, NCH would drop its appeal.

Morton said HMA was invited to take part in a Leadership Collier-Health Day session Nov. 13 where the issue is to be discussed but HMA officials declined. Otherwise, NCH has not formally approached them about sitting down at the negotiating table, he said.

John Merriwether, vice president of financial relations for HMA, said his company's president and CEO, Joseph Vumbacco, will be out of town on that date and can't participate. In addition, the topic is about how many hospitals are needed in the community, and Vumbacco said in a response letter that the debate on that subject is long over, given the state's approval of the new hospital.

Merriwether said NCH's appeal "is just another delay tactic" to avoid the competition.

"I would expect NCH to drag this out as long as they possibly can," he said.

Morton said, "Competition is not the question. The question is a level playing field."

NCH is not looking for fixed percentages of how much of Collier Regional's annual patient volume should involve charity patients and Medicaid patients to be a fair amount, Morton said. That's because how much medical care is provided to the needy fluctuates in any given year.

Rather, one way to ensure each hospital in a community is providing its fair share is to review the numbers at the end of the year for each hospital. An institution that provided less could reimburse, in a balanced way, the hospital that provides more. At the same time, HMA should get credit for what it pays in local taxes against its appropriate share of caring for the needy, he said.

"All hospitals should support the less fortunate equally and proportionately," Morton said.

Merriwether said Collier Regional will comply with what the state stipulated in the licensing condition, adding that they are minimal amounts required and could wind up being more. It's the state's jurisdiction to set those amounts.

"It's not Mr. Morton's job to be policing other hospitals and how they operate," he said.