Dover, Del.-based Bayhealth and Salisbury, Md.-based TidalHealth are raising concerns over Newark, Del.-based ChristianaCare’s proposed micro-hospital in Georgetown, Del.
ChristianaCare submitted a notice of intent to the Delaware Health Resources Board in February to build a $65.1 million health campus in Georgetown, including a neighborhood hospital with eight emergency beds and eight inpatient beds, as well as a health center with primary care, specialty care, behavioral health and outpatient services.
Two nearby systems have sent letters to the state’s health resources board opposing the neighborhood hospital and asking it to deny or delay that portion of the campus, CoastTV reported Sept. 3.
TidalHealth President and CEO Steve Leonard, PhD, submitted a letter Aug. 19 to the Delaware Health Care Commission and the Delaware Health Resources Board, which was shared with Becker’s. It said TidalHealth supports expanded access to primary care, behavioral health and specialty services, but is opposed to ChristianaCare’s neighborhood hospital, which it claimed does not meet the criteria of a micro-hospital.
The letter argued the facility may not meet Delaware’s statutory definition of a hospital in the first place, since it appears designed primarily around emergency care rather than inpatient services, and that even if it does qualify, state law recognizes no licensure category for a micro-hospital — only general, long-term care, psychiatric, rehabilitation and surgical hospitals. TidalHealth also pointed to Senate Bill 313, signed into law July 20, which places a moratorium through July 1, 2028, on for-profit acquisition of, or control over, nonprofit acute care hospitals in Delaware. Under the proposed joint venture, Emerus Holdings, a for-profit company, would hold a 49% stake in the neighborhood hospital and manage its day-to-day operations — an interest TidalHealth said nearly doubles the 25% ownership threshold at which the law presumes for-profit control.
TidalHealth asked the board to decline to process the neighborhood hospital application, dismiss it without prejudice, or pause it until Delaware creates an applicable licensing category, and to refer the ChristianaCare-Emerus joint venture to the Delaware attorney general for review.
In a Sept. 4 statement shared with Becker’s, Dr. Leonard said TidalHealth strongly supports high-quality and low-cost care while providing appropriate care in the right setting.
“Our concern is that this proposal involves a private, for-profit managing partner entering new markets to further their financial gains,” he said. “We support Delaware efforts to reduce the cost of healthcare, but this proposal continues to promote high-cost services and systems as compared to expanding primary care and low-cost ambulatory services.”
In a Sept. 4 statement shared with Becker’s, a ChristianaCare spokesperson declined to comment on the substance of the proceedings as the matter is under review by a state regulatory agency.
“ChristianaCare is committed to serving patients closer to home and making high-quality care more accessible in the communities where they live,” the spokesperson said. “Neighborhood hospitals, sometimes referred to as micro-hospitals, are an emerging model of care delivery designed to provide the right level of care, in the right place, at the right time.”
TidalHealth’s letter follows an Aug. 14 letter from Bayhealth Executive Vice President and COO Kyle Benoit, which was published by CoastTV. In it, Mr. Benoit asked the board to determine whether both applications satisfy the completeness requirements of Delaware law before proceeding to a substantive review, arguing that state law contains no statutory definition of a “micro-hospital” at all.
He also asked the board to evaluate whether the ownership and governance structure of the ChristianaCare-Emerus joint venture — in which Emerus would hold a 49% interest and governance rights — complies with Delaware law, including Senate Bill 313. Mr. Benoit asked the board to determine whether an application for an undefined facility type can be deemed complete, require production of the joint venture’s governing agreements, and defer substantive review of both proposals until those threshold questions are resolved.
A Bayhealth spokesperson said in a Sept. 4 statement shared with Becker’s that the system remains committed to the resources board’s established review process for proposed high-cost healthcare expenditures exceeding $5.8 million.
“We have significant questions regarding the additional proposed Georgetown and Camden hospitals, and we are not an outlier in our opposition,” the spokesperson said. “Bayhealth will continue to address these issues through the appropriate regulatory process, with a focus on responsible, sustainable healthcare planning for Delaware.”
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