Midwest

HUNTINGBURG, Ind.—St. Joseph’s Hospital, a stand-alone critical-access hospital, last month shut down after transferring its last patients to other facilities. St. Joseph’s, a one-time Catholic hospital located about 40 miles northeast of Evansville, Ind., defaulted on a $2 million loan from Brim Healthcare, which had managed the hospital for two years. Brim President Dave Woodland said the hospital wasn’t able to extricate itself from large debts that consumed its cash flow and also had some physician-related troubles, which further reduced admissions. Woodland said St. Joseph’s had been in default for some time but was in purchase talks with 129-bed Memorial Hospital and Health Care Center, Jasper, Ind. Memorial ended those talks Jan. 15. Brim declared St. Joseph’s in default, called for full repayment and assumed control of accounts receivable. St. Joseph’s, which recently converted to critical-access status, recorded a net loss of $404,000 on net patient revenue of $17.2 million in the fiscal year ended

Sept. 30, 2005, according to the American Hospital Directory.

INDIANAPOLIS—Hospital-owned Medicaid HMO MDwise last month acquired provider-owned IU Health Plan for an undisclosed amount. MDwise had previously rented IU Health Plan’s HMO license to contract with Indiana’s Medicaid managed-care program, called Hoosier Healthwise. Founded in 1994, not-for-profit MDwise is owned by four-hospital Clarian Health Partners, Indianapolis, and the Health and Hospital Corp. of Marion County, which operates 509-bed Wishard Memorial Hospital, Indianapolis. The not-for-profit IU Health plan was owned by the Health and Hospital Corp. and IU Medical Group, the clinical practice of the Indiana University School of Medicine’s faculty physicians. MDwise was one of three HMOs recently awarded a $4.4 billion, four-year contract with the newly restructured Hoosiers Healthwise program, which started Jan. 1. It now covers about 245,840 members statewide. “MDwise’s administration of the Hoosier Healthwise program will be more effective … by contracting directly with the state,” MDwise President and Chief Executive Officer Charlotte MacBeth said of the company’s decision.

O’FALLON, Mo.—BJC HealthCare, St. Louis, which owns or manages 12 hospitals, said its $75 million, 72-bed Progress West HealthCare Center opened last week. The hospital is the first in O’Fallon, a town about 35 miles northwest of St. Louis. Progress West includes all private rooms, obstetric services and in-house pediatric emergency care through an affiliation with 235-bed St. Louis Children’s Hospital. The hospital also features patient-care tracking devices, touch-screen technology in each patient room, a bar-coded medication delivery system and check-in kiosks with swipe-card readers. More than 350 physicians have applied for privileges at the hospital, BJC said. A 20,000-square-foot medical office building on the campus is completely rented out, BJC added.

IVANHOE, Minn.—Faced with ongoing financial losses and falling admissions, Divine Providence Health Center will close March 1, officials said. The 18-bed rural hospital, managed by Sioux Falls, S.D.-based Avera Health, suffered larger-than-expected losses in 2006, after a decade of operating in the red, thanks to low admissions and a drop-off in patients with favorable Medicare coverage, said Greg Wilson, Divine Providence’s administrator. Wilson declined to release the hospital’s 2006 revenue or losses. The rural hospital’s overhead rose as its census dropped to 0.9 patients per day and its reimbursement fell, Wilson said. Prior years’ cuts to staff and services left the hospital without options to further trim expenses, he said. The hospital received critical access status, a federal designation that grants small, rural hospitals a favorable Medicare payment rate. But Divine Providence admitted patients enrolled in Medicare managed-care plans that did not similarly adjust payments to rural hospitals. The hospital will continue to operate its assisted-living home, a 28-bed nursing home, and its home care services, he said. Once the facility closes, the nearest hospital will be roughly 12 miles from Ivanhoe in neighboring Hendricks, Minn.

CLEVELAND—Post-acute provider Kindred Healthcare, Louisville, Ky., recently opened Kindred Hospital-Cleveland, a 68-bed free-standing long-term acute-care hospital with a 40-bed bed subacute unit adjacent to the facility. The subacute unit offers skilled-nursing care, said Sharon Noro, executive director of Kindred’s Pittsburgh-Cleveland market. Kindred leases the building from the Benjamin Rose Institute, a not-for-profit health and social service agency. The company will also continue to operate Kindred Hospital-Cleveland-Gateway, the 51-bed hospital-within-a-hospital inside St. Vincent Charity Hospital, about five miles from the free-standing facility, Noro said.

MADISON, Wis.—The Wisconsin Hospital Association’s board unanimously rejected a proposed 1% tax on hospital gross revenue to boost reimbursement for patients enrolled in state-subsidized health plans, such as Medicaid and BadgerCare. The tax—proposed by Gov. Jim Doyle—is expected to raise $418 million over two years for a healthcare trust fund. It would be effective July 1, would primarily benefit hospitals with higher percentages of low-income patients and would secure additional federal matching funds, Doyle’s budget documents said. George Quinn, a senior vice president at the Wisconsin association, dubbed the tax an “unfortunate precedent” and “bad public policy,” and said its defeat is the association’s top legislative priority. Quinn said Doyle’s plan unnecessarily taxes hospitals and called the governor’s proposed $1.25-per-pack cigarette tax a viable alternative source of funding. The association board also endorsed revised guidelines for hospitals’ billing and collection practices, which were first issued

in 2004.

DES MOINES, Iowa—The Iowa Hospital Association said it opposes a recently introduced bill to expand Iowa’s certificate-of-need law to include hospitals that relocate within a county. Greg Boattenhamer, the Iowa association’s senior vice president of government relations, said such replacement hospitals do not expand capacity or alter market competition and therefore do not require oversight under the CON law. Iowa’s rural, aging hospitals would face additional costs and political hassles should the law change, he said. The bill is one of two recent challenges to Iowa’s CON exemption, passed in 1997, for replacement hospitals built within a county. Wellmark Blue Cross and Blue Shield of Iowa, Des Moines, previously sued to require two local hospitals to receive CON approval before building replacement facilities.