Video: How public reactions rip hospital buyouts apart

   In theory, selling a hospital should be a fairly routine matter, at least if no unusual legal issues are involved. Often, the acquisition solves some serious problems by bringing in much-need capital.

But just as often, things get extremely messy. Communities like things the way they are, and go nuts.  Nurses strike. Regulatory issues mire down transactions for years and political debates get very ugly. In fact, after 20 years of watching hospitals get acquired, I can’t tell you how many times I’ve seen such deals go down in flames.

Just how bad can it get?  Well, consider this video , a slickly-produced political statement challenging the sale of Houston’s Memorial Hospital Southwest to a county entity. The deal involved fell apart late last year, but the way it went down is worth a look.

When Harris County announced plans to buy Memorial Hermann,  at least 200 doctors vowed to walk off the job if the facility changed hands. Their grievances were many, but the CEO’s position really cheesed them off. From the text accompanying the video:

 [CEO Dan Wolterman says] that Memorial Hermann has exceeded profit expectations for nine straight years, but the system still laid off many of the system’s top people this year. Now they want to dump Memorial Hermann Southwest and are asking for a $165 million taxpayer bailout from the Harris County Hospital District, whose history of Medicare/Medicaid fraud should be a source of concern for all taxpayers. Can we really trust these two greedy executives?

And then they get to what seems to have been the real issue. “They want to get rid of urban hospitals and build palaces in the suburbs. And they want us to pay for it!” the announcer warns sternly. So this particular battle had a “haves vs. have-nots” feel.”

OK, I’m going to get cruel here. I’m not convinced that doctors were really worried about saving an urban hospital.  They don’t make much money there and their patients are often indigent. But sometimes power struggles don’t need any real  justification.

The bottom line is that this kind of protest plays out in some community every day — and can get even hotter if a for-profit company rolls into town and starts shopping.

In fact, during Columbia Hospital Corp.’s acquisition spree in the early 90s, I attended a closed-door meeting on a proposed buyout in south Miami. One doctor said that he’d better drop his pants now because of, uh, what would happen next. Bear that in mind as you’re shopping, investors. And watch this video once or twice.

About the author

Anne Zieger

Anne Zieger

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

3 Comments

  • You’d think so, Anne. That seems to be what’s happening here in Indianapolis, where Clarian Health has announced it’s going to expand downtown. (They’re building suburban palaces, too.) I guess everyone must think all the money is in the suburbs, and all the charity cases are in the city.

  • Ken:

    Agreed, it’s one hell of a hard-nosed pitch.

    As for the comment you mentioned, yeah, I found that to be pretty entertaining too — though I suspect there’s some truth to the allegation.

    When all is said and done, however, I don’t think I understand the politics here. Wouldn’t doctors benefit from a better funded urban hospital which could afford to upgrade facilities and equipment.

    Any thoughts?

    -Katherine

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