Taking on the establishment can be a humbling experience. A 2-year-old ambulatory surgery center outside St. Louis learned that lesson last week, when its initial effort to become Missouris first-ever specialty hospital was thwarted in large part by big competitors.
The St. Louis Surgical Center, located in the suburb of Creve Coeur, ran up against a brick wall of opposition from nearly every acute-care hospital in the regiona coalition of providers that included about 10 hospital organizations representing dozens of facilities, as well as community groups such as the Urban League.
Faced with this well-organized opposition in a fiercely competitive market, the surgical center attempted last week to postpone a hearing on its application before the Missouri Health Facilities Review Committee, which must endorse all hospital projects of $1 million or more under the states certificate-of-need program. After the committee voted to deny the extension, the facility withdrew its application in the face of almost-certain defeat. The center then submitted a required letter of intent indicating its plans to refile the CON application but later withdrew that request as well, says Tom Piper, the director of the states CON program.
We dont know where theyre going or what theyre doing, Piper says. We do know there are a lot of questions.
The surgical centers chairman and chief executive officer, John Hirsch, a physician, says the facility is in negotiations with a local health system that for now remains anonymous. He says, however, that he is intent on pursuing my dream of creating a new paradigm in healthcare delivery.
Piper says a partnership with a local hospital or health system would likely make any future application more palatable to regulators. He also says there are rumors that at least four other ambulatory surgery centers are awaiting the decision in this case and may seek a similar upgrade if the St. Louis Surgical Centers application is approved, meaning that the decision will set an important precedent.
The surgical hospital, which has five operating rooms, sought permission to expand into a specialty hospital with nine patient rooms and seven operating suites at a cost of about $10.5 million.
We just did not believe that this met the definition of a hospital, which is a healthcare delivery organization that serves the needs of patients 24 hours a day, seven days a week, says June Fowler, spokeswoman at BJC HealthCare, which has 12 hospitals in Missouri and Illinois and was among the most vocal foes of the proposal.
Molly Gutierrez, executive director of Physician Hospitals of America, a trade group, says the CON process has been perverted. Created in the early 70s as an effort to better regulate a communitys need for healthcare services and to help contain costs, the regulations have become a political process that looks less at need and more at who the players are who can push the right buttons with the CON board, she says.
The number of states with some form of a CON law has dropped from 49 in 1982 to 36 in 2004, down 27%, according to a detailed analysis published in 2005. Gutierrez called for the abolition of CON regulations across the country, suggesting that more competition will improve quality and reduce costs.