A small town outside Kansas City last week made good on its threat to initiate condemnation proceedings against the town's only hospital.
The Board of Aldermen of Smithville, Mo., voted to condemn the property under eminent domain so it can be leased to another nearby hospital. In July the town had warned the hospital's owner, St. Luke's Health System of Kansas City, to restart acute-care and emergency services-or else.
"We are shocked and saddened at this legal action by the city of Smithville," St. Luke's said in a written statement. "This action is a threat to our mission, patients and employees and we will vigorously oppose it."
The facility, once known as Spelman Memorial Hospital, was merged into St. Luke's in 1992. In March 1995, St. Luke's shut down emergency and acute care at Spelman, saying it had too few patients and was losing too much money. The system turned the building into a skilled-nursing and rehabilitation center. Town residents have been fighting St. Luke's ever since.
They found an ally in nearby North Kansas City Hospital, which offered to finance condemnation proceedings if the city would give it a lease to operate the facility, including acute and emergency services.
St. Luke's did not respond directly to Smithville's ultimatum but instead proposed a joint venture with North Kansas City to operate the facility. Under a joint venture, St. Luke's said, the hospital could regain viability because it could draw patients from managed-care plans affiliated with both partner hospitals.
But Smithville's aldermen weren't buying a joint venture, and neither was North Kansas City Hospital. North Kansas City viewed St. Luke's proposal as nothing more than an effort to split its losses with a longtime competitor.
"Providing emergency service and acute care in a hospital you already own doesn't require a joint venture," said Michael Payne, president of North Kansas City.
Mary Ball, spokeswoman for St. Luke's, said Smithville's action-a municipality condemning a hospital to lease it to another hospital company-was unprecedented. "Our research indicates that it's not been done," she said.