Covenant CEO vows to fight Carle's bid to 'control' market
URBANA — Presence Covenant Medical Center officials say they're objecting to more than just a bigger Carle Foundation Hospital in its 48-bed expansion plan.
They're fighting off an attempt by Carle to put Urbana's smaller hospital out of business.
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A June 24 letter from Carle CEO Dr. James Leonard to Sandra Bruce, the CEO of Covenant parent system Presence Health, included a proposal to convert Covenant into a joint-venture behavioral-health facility with Carle and for Carle to buy Presence United Samaritans Medical Center in Danville, said Dr. Jared Rogers, interim president and CEO of Covenant and United Samaritans.
"Our thinking is they (Carle) really do want to control all the medical services in this area," Rogers told The News-Gazette on Monday.
Presence Covenant transforming into a behavioral-health facility, Rogers also said, "is not in our plans."
Carle's newest proposed expansion — currently stalled before the state's Health Facilities and Services Review Board — would be a $17.7 million conversion of vacant ninth-floor tower space to add more medical-surgical beds.
The project would expand its total medical-surgical beds from 212 to 260 and boost its total licensed-bed capacity to 393.
Covenant Medical Center vigorously fought the proposal at a state board hearing last week, and the board declared an intention to deny permission for the additional beds. However, Carle says it will be returning to the board with more information at a later hearing to try again.
Rogers said Leonard's letter to Bruce, which hasn't been shared publicly, was received by Presence Health too late to be included in documentation that was submitted to the board.
Carle Vice President Mike Billimack said the letter to Presence Health leadership was "entirely separate" from its petition before the state board.
"Carle recently sent Presence leadership a letter inquiring about potential interest in their Danville hospital and/or their interest in developing a joint behavioral-health facility in Champaign," Billimack, Carle's VP for marketing, planning and government relations, said in an email to The News-Gazette. "Carle has made a long-term commitment to providing services in Danville and Vermilion County. Carle is always interested in supporting and growing the level of services available to Vermilion County residents, and we will continue to explore ideas that benefit area residents."
Billimack also said a recent community health-needs assessment Carle did with Covenant and "other local entities" identified, as expected, the issue of behavioral health as a critical need in the community.
"The idea of developing stronger behavioral-health services is one the community would clearly welcome," he said. "As the regional clinical safety-net hospital, we are always interested in exploring potential opportunities that would benefit the communities we serve."
Carle's request for more beds is about ensuring that beds are available for specialty care that isn't currently provided by other regional hospitals, "including the types of specialty care that Presence chooses not to offer," Billimack said.
But if Carle is permitted to add the extra beds, Rogers said, most of the extra patients to fill them would be drawn from Covenant, and the effect would be devastating. The 48 beds Carle wants to add equals Covenant's entire average daily number of medical-surgical patients in the hospital, he said.
The state board said there is already an excess capacity of 158 medical-surgical beds in the area that includes Carle and Covenant.
Dr. Krishnarao Tangella, Covenant's and United Samaritan's regional medical director of laboratory, contends that Carle would be adding even more excess capacity and would be allowed to grow at the expense of other hospitals.
"That's probably not the most efficient way to use $18 million," he said.
And, Rogers added, "it's the consumers who pay the $18 million."
Urbana Mayor Laurel Prussing has been making her objections to Carle's plans known, saying her position is based on "the concern expressed by Presence (Covenant) that this is going to kill them."
Prussing said she believes Carle is trying to drive Presence Covenant out of business, and she contended that any move by the board to help that along will drive down competition and leave the public more vulnerable to "price gouging."
"If the purpose of this board is to not duplicate services and to benefit the public, the public is not going to be benefited by reducing competition in the market," she said. "I think we've been gouged already, and the state should not be making it worse."
Several area hospitals have taken sides on this project, with United Samaritans and Iroquois Memorial (managed by Presence Health) joining Covenant in objecting and Paris Community Hospital, Kirby Medical Center, Richland Memorial Hospital, Decatur Memorial Hospital, Carle Hoopeston Regional Health Center and Crawford Memorial Hospital all supporting Carle.
Kirby Medical Center CEO Steve Tenhouse said Carle has been a good partner for the Monticello hospital.
Plus, he said, "the majority of what we're transferring to Carle is beyond the level of care that we provide here."