A proposal to loosen certificate-of-need regulations in the District of Columbia has triggered a battle between a struggling academic health center and the city's biggest hospital.
The District of Columbia City Council is considering streamlining its CON law to make it easier for healthcare providers to buy other institutions.
Under the district's existing law, any provider wishing to make a capital purchase of more than $2 million, including outright acquisitions, must first get a CON. The council has not outlined its options for reforming the CON law.
Such a law would make it easier for George Washington University to sell its medical center or join in a partnership or affiliation, as it has been considering, as a way to refurbish the aging facility.
George Washington University Hospital earned $3 million on gross revenues of $370 million for the fiscal year ended June 30, 1994, the last year for which complete figures were available.
Columbia/HCA Healthcare Corp. and other for-profit hospital chains have been thought to be among the potential partners or purchasers of GWU Hospital.
But executives of Medlantic Healthcare Group, which owns not-for-profit Washington Hospital Center, the district's largest hospital with 907 licensed beds, are objecting to the streamlining.
They warn that if for-profit healthcare companies are able to buy GWU's hospital without a CON, vital but expensive services may be eliminated without public review.
Medlantic has purchased advertisements in community newspapers objecting to the possible change in the CON law and attempted to generate grass-roots opposition by meeting with community groups.
Among the services most likely to be eliminated is emergency care. Poor, uninsured residents-representing about one-fifth of Washington's population-often rely on the emergency room as their primary healthcare provider, Medlantic executives said.
The executives argue that elimination of such services should be subject to public review.
GWU Hospital provided $8.6 million in uncompensated care in 1994, according to the District of Columbia Hospital Association. Washington Hospital Center provided $31.3 million in uncompensated care that year and, together with the public District of Columbia General Hospital's $81.9 million, provided more than half the uncompensated care in Washington.
District of Columbia hospitals provided a total of $211.5 million in uncompensated care in 1994, according to the DCHA.
"In that kind of an environment, it seems like mergers, acquisitions and development of networks are to be done in such a way that everybody participates in the uncompensated-care burden," said John Green, Medlantic's executive vice president.
But GWU executives charge that Medlantic is being "protectionist" and that the regulations involved with obtaining a CON are keeping needed healthcare resources out of Washington.
"In a community like this, which is becoming increasingly economically depressed*.*.*.*we need to attract all the resources we can into the community from the outside," said Thomas Chapman, chief executive officer of GWU Hospital. "Creating protectionist laws and rules guarantees that most healthcare organizations in this community will be harmed. You will not see any more resources come in."