Hospital challenges union report suggesting charity care at Detroit Medical Center declined 98% under Tenet: 7 things to know

Dallas-based Tenet Healthcare has significantly reduced charity care spending in Detroit-area acute care hospitals, the Michigan Nurses Association claims in a report released March 21

Here are seven things to know.

1. For the report, the MNA examined data from Medicare cost reports submitted to CMS by Detroit-area hospitals. They said they found charity care spending in Tenet Detroit Medical Center declined 98 percent over the course of three years. The report states Tenet DMC spent $470,000 on charity care in 2016, down from $22.9 million in 2013 — the year Tenet purchased DMC from for-profit Vanguard Health Systems.

2. The MNA ssaid Southfield, Mich.-based Beaumont Health and Detroit-based Henry Ford Health System also saw charity care decline during that time period, although not as much. The union said they found Beaumont spent $26.6 million on charity care in 2016, down 67 percent from $79.8 million in 2013. At Henry Ford Health System, they said charity care spending declined 65 percent, from $55.7 million in 2013 to $19.3 million in 2016.

3. The MNA recommended the Legacy DMC Board include "a requirement that Tenet DMC set aside additional funds for charity care, greater access to information for patients and the public, and appointment of an ombudsman to represent patient and community concerns." Board President Joe Walsh told The Detroit News the board is looking into the union's allegations.

4. A part of the decline in charity care in Michigan hospitals can be attributed to the state's expansion of Medicaid under the ACA in 2013. Under the expansion, the state created the Healthy Michigan Medicaid program for low-income residents, which kicked off in 2014 and resulted in fewer uninsured patients and less charity care spending. In 2014, charity care levels in the state were at $353 million. By 2016, that number had declined to $159 million, according to a study from Ann Arbor-based University of Michigan. Michigan Health and Hospital Association data also shows this trend, finding Medicaid expansion in Michigan through the insurance exchange and the Healthy Michigan Plan contributed to a statewide decline of charity care for fiscal years 2015 and 2016, the latest years for which data is available. The association also noted hospitals in Michigan at the same time saw additional bad debt in fiscal year 2016.

5. Tony Tedeschi, MD, CEO of the DMC expressed disappointment in the report. He said in a statement to Becker's Hospital Review the union "has chosen to cherry pick numbers in their report that leave out essential information about how all hospitals across the state report uncompensated and charity care." He also called the report "an unfortunate attempt to characterize an issue that does not reflect the entire story. The American Hospital Association reports that hospitals incur two forms of uncompensated care  — bad debt and charity care." 

"These attempts by the MNA are intended to distract us from what is most important and that is our commitment to provide quality patient care to our community," Dr. Tedeschi said. "We continue to work in good faith with the MNA and the Huron Valley-Sinai Hospital nurses to negotiate a contract that is fair. This is an insult to these hardworking men and women who work with the DMC as well as to those who rely on the DMC in their times of need. We are privileged and honored to provide critical services to all who seek care at our facilities. … while the DMC, including Huron Valley-Sinai Hospital, is now part of a larger, investor-owned health system, we continue to stand up for all who are in need just as we did when we operated as a nonprofit."

6. Dr. Tedeschi noted hospitals in Medicaid expansion sates have seen charity care decline, but DMC still provided more $112.3 million in charity care between 2013 and 2017.

7. Beaumont denied the assertion that it has reduced charity care.

"The ACA and Healthy Michigan have provided coverage to many patients who were not covered previously," said Beaumont in a statement to Becker's Hospital Review. "We also offer discounted care for those with hardships. We work together as one care team to advocate for our patients and provide the highest quality healthcare services regardless of where our patients live or their financial circumstances."

Becker's Hospital Review reached out to Henry Ford Health System and will post additional details as they become available.

 

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