With modern financial and religious pressures adding shades of gray to the definition of “Catholic hospital,” the Catholic Health Association has decided to take up the issue—through a debate over its membership policies.
CHA re-examines rules on Catholic status
For example, can a hospital stripped of its Catholic status by a bishop remain a member? (Yes.) What if the local bishop is upset with the CHA and demands removal? (Membership is removed.) What if a for-profit chain maintains a contract to fulfill Catholic ethics as long as the rules are not materially burdensome? (To be determined.)
All of those issues were raised in 2010. In December, the CHA Board of Trustees voted to begin an examination into the association's membership rules, following several developments in Catholic healthcare, particularly the $895 million transaction that resulted in Boston's six-hospital Caritas Christi Health Care being owned by for-profit Cerberus Capital Management.
The question of admitting for-profit companies as members of CHA provoked impassioned debate in the 1990s, but the trend toward secular ownership of Catholic hospitals grew in 2010.
CHA spokesman Fred Caesar confirmed last week that one key question for CHA is whether the membership rules should be changed so Caritas—now called Steward Health Care System—and other hospitals and systems “can remain members into the future.”
A subcommittee of the CHA trustees is considering whether to revise the rules for membership and is scheduled to deliver a recommendation to the full board this year in advance of a full membership vote at the association's June assembly in Atlanta.
“My sense is the board has proactively established a process to examine the changing marketplace and try to pass judgment on what, if anything, the association should do with respect to the landscape of its changing members,” said Joseph Swedish, a CHA trustee and president and CEO of 33-hospital Trinity Health, Novi, Mich.
The U.S. has roughly 600 Catholic hospitals, which treat about 16% of all admitted hospital patients, according to the CHA.
Several trustees of the association were hesitant to talk about the issue last week, and CHA officials and would respond only to questions in writing.
Such debates have roiled the organization in years past. In 1995, then-CHA President and CEO John Curley declared at the association's annual meeting that “the investor-owned model is not compatible with the church's mission in healthcare. One cannot serve both God and money.” (June 12, 1995, p. 2)
That debate resulted in a vote to ban for-profit hospitals from becoming full members with voting rights—a ban that still stands today, according to Article IV of the CHA bylaws.
CHA's members, meanwhile, have been changing affiliations rapidly following several recessionary years.
Last June, for-profit HCA agreed to acquire 473-bed Mercy Hospital in Miami from Catholic Health East, and in December, investor-owned Vanguard Health Systems agreed to acquire 160-bed Holy Cross Hospital in Chicago. The deals stipulated that the for-profit owners would continue to operate the hospitals under Catholic identities and ethics.
The most closely watched of these deals was between Caritas Christi and Cerberus. Although Caritas stopped being operated by the Archdiocese of Boston in 2008, Cerberus struck a Catholic-identity agreement with the separate not-for-profit corporation that had been running the system.
The system agrees to follow Catholic ethics on reproductive and end-of-life issues, though it has an option to pay $25 million to a charity designated by the Boston archbishop if Catholic identity becomes a material financial burden over multiple years.
However, not all of the uncertainty around the definition of “Catholic hospital” stems from financial events.
In April, the CHA rescinded the membership of 295-bed St. Joseph Health Services of Rhode Island in North Providence after Providence Bishop Thomas Tobin demanded the hospital leave the CHA. The bishop said his demand was in retaliation for the association's support of the Patient Protection and Affordable Care Act.
However, 697-bed St. Joseph's Hospital and Medical Center in Phoenix remains a member of the association even though Phoenix Bishop Thomas Olmsted removed his endorsement of the hospital as Catholic in December.
Olmsted said the hospital performed an abortion and violated Catholic teaching, but hospital officials said it was allowed under rules that allow for an indirect termination of pregnancy to treat an underlying health condition.
St. Joseph's President and CEO Linda Hunt has said the hospital “will remain faithful to our mission of care, as we have for the last 115 years.”
Although Sister Carol Keehan, CHA president and CEO, sided with the hospital in public statements, Caesar said in an e-mail that the decision on St. Joseph's membership comes down to the status of its parent system.
The CHA bylaws define a “Catholic entity” as “any entity that is recognized as Catholic by the diocesan bishop.” But St. Joseph's membership comes through its corporate parent, Catholic Healthcare West.
- Members: More than 2,200 (hospitals, systems and nursing homes)
- Net income: ($2 million)
- Revenue: $17.1 million
- Membership dues: $15.9 million
- Salaries and benefits: $5.3 million
Note: Financial figures are for fiscal 2009
Source: Catholic Health Association, CHA IRS Form 990
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.