While the custody fight over Elian Gonzalez cast an international spotlight on Miami, it was another custody battle that riveted the attention of local hospital leaders.
At stake this time were millions of dollars of public money.
The Florida Legislature decided the issue May 5 when a bill was passed requiring Miami-Dade County to share property tax money with private hospitals, including investor-owned facilities, to subsidize care for the poor.
It was a pivotal moment for the Miami-Dade County healthcare market, where one in every four residents is uninsured, compared with one out of every six residents in all of Florida.
Miami-Dade County is home to about 2 million people.
"It's the first time the government has done more than just lip service to the idea of dollars following patients," says Linda Quick, president of the South Florida Hospital and Healthcare Association, which supported the measure.
And like the custody battle over Gonzalez, the issue of sharing county money with private hospitals has been a divisive one.
The bill was sponsored by state Rep. Carlos Lacasa, a Miami Republican.
The issue has rankled some county officials, including Ira Clark, president and chief executive officer of 1,320-bed Jackson Memorial Hospital and the Public Health Trust, Miami-Dade's mammoth publicly funded healthcare system. Clark says diverting public money is like "stealing something that they're not entitled to."
The new law requires Miami-Dade County to set aside $10 million the first year, $15 million the second year and, in the subsequent three years, 25% of an annual contribution it makes to the Public Health Trust. In recent years, the county's annual contribution to the trust has been about $88 million.
"We don't have any money we don't need," Clark says. For the fiscal year ended Sept. 30, 1999, Clark says Jackson Memorial had net income of $9.7 million on total revenue of $657 million.
It's still unclear how many hospitals will get a cut of the public money, but private hospitals hoping to capture some of it say they're just getting part of what's owed them for their cost of uncompensated care.
Edward Rosasco Jr., president and CEO of 339-bed Mercy Hospital in Miami's wealthy Coconut Grove neighborhood, says his facility provided about $9 million in uncompensated care last year. Mercy is part of Catholic Health East, a Newtown, Pa.-based Roman Catholic system.
"We're all doing the same care of the poor as the Public Health Trust (the governing body that oversees Jackson Memorial), but they're being significantly compensated to do it," Rosasco says.
A hot market. Regardless of the recent political tussle over county money, "chaotic" is how Quick, of the local hospital association, describes the Miami-Dade County healthcare market.
"It's not clearly delineated and organized," she says. For example, physicians typically practice at multiple hospitals, and patients with insurance usually have a bevy of provider options to choose from.
When Quick talks to people about the local healthcare market, she "describes it as an embarrassment of riches."
"We have a lot of healthcare and a lot of really good healthcare," Quick says.
Consequently, Quick says, "it's expensive because it is so plentiful."
Among the county's 28 acute-care hospitals, the average cost per admission is $12,083, higher than the national average of $11,984, according to data supplied by Chicago-based SMG Marketing Group for Modern Healthcare. Meanwhile, the cost per patient day in Miami is $2,210 compared with the national average of $2,154.
The hospitals are split about 60-40 by type of ownership, with 17 not-for-profit hospitals, including county-owned Jackson Memorial, and 11 for-profit facilities, the data show.
Steven Sonenreich, president and CEO of 493-bed Cedars Medical Center, which is owned by Nashville-based Columbia/HCA Healthcare Corp., says the sizable presence of for-profit hospitals hasn't affected the market any more than their not-for-profit counterparts.
"I think our agendas are quite similar," he says. "We are all trying to survive."
The hospitals in Miami-Dade County also tend to be bigger than in other parts of the country. Facilities there average 294 staffed beds per hospital compared with a national average of 151 beds.
Also compared with the rest of the country, Miami-Dade County is a high-volume market.
Average hospital admissions run more than 9,300 per hospital compared with just 6,021 average admissions nationally, according to SMG data.
The county ranks No. 5 nationally in total Medicare beneficiaries with almost 299,000, according to HCFA. Miami-Dade County is ranked behind Los Angeles County; Cook County, Ill.; Maricopa County, Ariz.; and San Diego County, respectively.
The county's hospitals are equally busy with Medicaid patients. Medicaid discharges account for 21 per 1,000 population, compared with a national average of 17 per 1,000 people, according to SMG.
Mercy's Rosasco says Miami goes through the same machinations as other healthcare markets. He says the effects are just felt more dramatically because of the large Medicare population and high healthcare costs.
Mercy joined CHE last year after its planned merger with Baptist Health Systems of South Florida collapsed. After more than two years of talks, the merger fell apart after Baptist--bowing to community and physician pressure--backed down on a move to ban abortions at all four of its hospitals (Sept. 28, 1998, p. 28).
In addition to its 28 hospitals, the Miami-Dade County market has 50 nursing homes, 191 medical group practices, eight HMOs and three PPOs, according to SMG.
The county also has 211 home health agencies, 20 freestanding outpatient surgery centers and 45 diagnostic imaging centers.
Reimbursement struggles. Rosasco says the issue over sharing public money with private hospitals came to a head because of other reimbursement issues in the healthcare industry, such as those involving managed care and federal health programs.
"We might not have been in need of a . . . bill if other things were working well," Rosasco says.
The final version of Lacasa's legislation was a ratcheted-down compromise package approved by county officials. The measure is set to expire in 2005 unless it is re-enacted by lawmakers.
In addition to property tax money, Jackson Memorial also collects about $120 million annually from a special 1/2-cent sales tax levy. That money is unaffected by Lacasa's bill.
The legislation establishes an independent healthcare authority that will use county money to subsidize networks of community providers, including doctors and hospitals. The networks will be divided geographically throughout Miami-Dade County.
Some of the reasoning for establishing the new networks is that Jackson Memorial, near downtown Miami, isn't conveniently located for the county's poor, who might live in more far-flung areas of the county.
Executives of Jackson Memorial contend their hospital already provides outreach in Dade County through a network of 13 primary-care centers, two nursing homes and a maternity hospital in northern Miami-Dade County.
Jackson Memorial's Clark takes a swipe at other local hospital leaders and their touting of the indigent care they provide.
"Indigent care is not the difference between costs and charges," he says.
Clark says private not-for-profit hospitals already are compensated for the care they provide to the poor through their tax exemptions.
"That is no less a cash subsidy for what they are supposed to do," he says.
And at least one Miami hospital administrator questions whether the state Legislature should have intervened in a county issue.
Cedars' Sonenreich says the issue of indigent care should be addressed locally and "should not be something that requires the state Legislature's involvement."
Cedars is across the street from the 67-acre campus near downtown that Jackson shares with the University of Miami Medical School and the 40-bed University of Miami Hospital and Clinics.
The cost of the uninsured. Market dynamics involving indigent care are what have forced Miami's Baptist Health Systems to turn to the Public Health Trust for a helping hand, says Brian Keeley, Baptist's president and CEO.
The four-hospital system hopes to strike a deal with the trust to help Baptist recover from financial losses at its 100-bed Homestead (Fla.) Hospital in the southern part of the Miami-Dade region.
Homestead's losses are "not a cost problem," but a "net revenue problem," Keeley says.
Keeley says there is demand for a hospital in Homestead, but the community can't financially support it because there are too many uninsured patients.
"They don't have enough economic infrastructure there to support a hospital," Keeley says.
Homestead Hospital has weathered other tough times. Before becoming part of Baptist, the hospital, like the community it serves, was heavily damaged by Hurricane Andrew in 1992.
Baptist has asked the Public Health Trust to either partner with the system to create a new not-for-profit organization to oversee Homestead or subsidize indigent care at the hospital through payments equaling 50% of Homestead's losses. Last year, Homestead lost $6 million, and this year the hospital expects to lose $7 million, Keeley says.
The Public Health Trust has expressed interest in adding a hospital in south Miami-Dade County. The trust has talked with Columbia about buying its 233-bed Deering Hospital, which is north of Homestead, says Conchita Ruiz-Topinka, spokeswoman for Jackson Memorial. However, she says those talks are on hold while the Homestead discussions play out.
Keeley says Baptist wouldn't need a bailout plan for Homestead if the system, overall, were performing better and had at least an operating margin of 1% to 2%.
Instead, Baptist lost $8.7 million on operations for the fiscal year ended Sept. 30, 1999. The system's net losses amounted to $200,000, Keeley says.
Late last month, the Public Health Trust made an offer to Baptist to lease Homestead for five years.
Baptist has 30 days to respond, but it hadn't announced its decision as of deadline.
If a bailout plan for Homestead doesn't materialize, Keeley says, other options include closing Homestead or converting it to an outpatient facility.
"We've done everything humanly possible to turn it around," he says.