The proposed settlement doesn't hurt Heartland, Schaaf said. "It hurts the doctors. It has weakened our managed-care company that we own half of. It has cost us every cent we have. They just sent around a letter asking each shareholder to kick in $450 to pay our legal expenses."
David W. Fields, executive director of the Humana health plan in Missouri, said he is pleased that Heartland "is going to be able to spend their dollars on healthcare instead of attorney bills." Fields said he hopes the settlement means the St. Joseph market will become more amenable to competition on the health-plan level.
He questioned whether healthcare duplication and expenses have really been reduced by consolidating care under one organization, albeit a community-based, not-for-profit one.
"We all forget who's important in this chain," Fields said. "What's really important is the people who pay the bills-the employers, employees, the federal government, the state government. What has happened to the cost of healthcare, the people who pay the bills, in Northwest Missouri in the last five to 10 years? Do the employers feel like they've gotten a good deal?"
The high cost of healthcare in that part of the state shows up in stark relief in the public bid proposals for state employees' healthcare. The bid by Heartland's new HMO was the highest of all eight regions in the state, $185.78 per enrollee per month. The highest bid in the St. Louis area was $163.38; the highest bid in the Kansas City area was $168.54. Low bids were in the $120 range.
Heartland spokesman Steve Wenger said the bid is high because it's by a new HMO competing with established plans. "The actuarial work has no track record on which to take any risk," Wenger said.
Kian Shafe, proprietor of Kendallwood Home Health, thinks the Justice Department settlement is "very clear, but it's not as detailed as I'd like it to be. The hospital will be monitored for 10 years by local people. Every time they want to do something, they have to call the Justice Department and get permission."
But, Shafe said, the settlement fails on the key issue. "It only addresses the problem of monopoly in the market. It does not address the issue of care.
"When you have one hospital that controls the market, you have no competition. Without the competition you have no control on the price and you have no control on quality of care," he said.
"If Blue Cross goes up there, they have to have a contract with that hospital. The hospital just jacks them up. That is a monopoly and they are trying to expand on that," Shafe said.
Indeed, one insurance company, which asked not to be named, reached an agreement with the hospital in the month after the consent decree was published. But it still doesn't feel the discounts are in line with what it receives at comparable locations.
Shafe contended that Heartland uses its monopoly in acute care to expand into ancillary services, such as home health, hospice, rehabilitation and durable medical equipment. The hospital doesn't like to refer patients to competing providers because it wants to keep them within a closed circuit. But outside ancillary providers would function as a check on the hospital's quality of care, Shafe believes.
Shelly Schoeneck, administrator of Bender's Home Health in St. Joseph, agreed: "A closed integrated system is what they want. Once you as a patient get in the door, they don't ever want you out. If they're not doing it with quality and with the patient's best interest in mind, that's where I have a problem."
Schoeneck added, "If I had a choice, if I had something really wrong with me, I wouldn't go to Heartland. I'd drive 45 minutes to Kansas City. They don't understand that the competition in Kansas City makes every hospital on their toes. When you walk in the door, they're glad to see you. They treat you like you're walking into a resort."
Heartland officials reject those assertions and deny that the system is providing substandard care.
In addition to home health, Bender's operates retail pharmacy, durable medical equipment and private-duty nursing businesses. Schoeneck complained that the referral policy outlined in the consent decree "doesn't solve the problem very well."
Under the guidelines, a patient who needs ancillary services but doesn't have a preference will be told that Heartland operates "an excellent, fully accredited ancillary service.....If the patient accepts, then the referral shall be made to Heartland's ancillary service."
But if the patient doesn't want the Heartland service, the patient is to be referred to the phone book to pick a competing service.
"I don't even need to tell you what's wrong with that," Schoeneck said. "When you have an ill person in bed, being sent home early on their DRG, and needs home health services, and you ask them to look in the phone book for their provider, what are they going to do? They're tired. They're weak. They're just going to say, `Do it.'*"
Schaaf, too, thinks the referral policy is favorable to the hospital.
Wenger, the hospital spokesman, said some aspects of the consent decree are fuzzy but not that part. "The messenger model-nobody really knows how to do it. But on that point (referrals), they clearly said, the policy as we have it is fine. There is no change in policy.
"If our competitors don't agree with the feds, that's a different kettle of fish. But it's been specifically cleared."
In fact, the competitors disagree with the feds to such an extent that they have formed a self-proclaimed Coalition for Quality Health Care to address the failings of the consent decree.
Kristen Helsel, branch director for Kendallwood Healthcare Services in St. Joseph, said the coalition represents "all the ancillary providers in the area who have an interest in responding to this consent decree." They have held several meetings to discuss how they'd be affected by it and are planning a joint written response. They're also trying to gather 14,000 signatures on a petition opposing the decree.
"I have a lot of problems with the referral policy if it becomes part of the consent decree, and a lot of problems with the consent decree as far as recruitment of physicians," Helsel said.
The group hasn't contacted the Justice Department directly with its concerns but has talked to the state attorney general's office.
"People are understanding that this consent decree isn't going to do what we hoped it would, and so people are less afraid," Helsel said. "They are starting to speak out now, whereas they were much more timid a year ago. In two years I'm not going to be here if I don't stick out my neck. What do I have to lose?"
Shafe, too, was not optimistic that the settlement as written will really solve the problem in St. Joseph.
"Will it straighten out? I doubt it, unless citizens monitor it closely," Shafe said. "Citizens should raise their voice and say, `This is our town! What is happening here?' They need to go in there and raise hell."