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Surgery Center of Kenai seeks transfer agreement with CPH

Posted: July 24, 2014 - 9:47pm  |  Updated: July 25, 2014 - 4:46pm
Photo by Rashah McChesney/Peninsula Clarion  Tom Wilkinson, director of nurses, talks about surgical recovery rooms while Jake Savely, surgical tech listens during a tour of the Surgery Center of Kenai, LLC., Tuesday July 22, 2014 in Kenai, Alaska.
Photo by Rashah McChesney/Peninsula Clarion Tom Wilkinson, director of nurses, talks about surgical recovery rooms while Jake Savely, surgical tech listens during a tour of the Surgery Center of Kenai, LLC., Tuesday July 22, 2014 in Kenai, Alaska.

The Surgery Center of Kenai recently opened its doors to patients on Trading Bay Road in Kenai, but it is facing some restrictions on which patients can be treated.

Harold Gear, vice president of the outpatient surgery center, said because Central Peninsula Hospital won’t enter a transfer agreement with the center, it cannot perform procedures on Medicare and Medicaid patients.

When the center was beginning constructed, Gear said it requested agreements with Alaska Regional Hospital, Providence Alaska Medical Center and Central Peninsula Hospital.

“The transfer agreement is just a protocol for how if you have an emergent patient how you will present them to the emergency room,” he said. “It’s just a ‘we’ll do this, you’ll do that’ delineation of responsibilities. It’s not a business agreement; it’s just a hand-shake protocol.”

Within two weeks, Gear said Alaska Regional gave the center an agreement and Providence offered an agreement. After discovering the center had one with Alaska Regional, Providence said it would be available if necessary.

“Central Peninsula Hospital ignored us,” Gear said.

After writing a letter to the Central Peninsula General Hospital Board of Directors in June, Gear said he was told it was CPH CEO Rick Davis’ decision, who declined to enter an agreement with the center. Gear said the discussion started in January and he received a final verbal “no” earlier this month.

“We’re owned by the borough and the borough has a lease operating agreement with the board to manage the hospital,” Davis said. “And one of the requirements of that operating lease is that we remain self-sufficient and off the taxpayer rolls, and that’s what we’re trying to do here.”

The surgery center is a Class C minor outpatient facility with a 23-hour maximum patient stay, Gear said.

In July 2013, Gear received notice form the Department of Health and Social Services that it would not need a certificate of need because its project cost was below the $1.45 million threshold that requires a CON.

Gear previously opened the Pain and Headache Center, which focuses on treating chronic and acute pain, with offices in Wasilla and Anchorage.

Gear said while the surgery center meets state licensing requirements, because the Centers for Medicare and Medicaid Services requires a local transfer agreement to treat those patients, it needs an agreement with CPH.

“So we’re being blocked from half of our patients by Central Peninsula’s unwillingness to give us a transfer agreement,” he said.

Davis said he doesn’t see any benefits for CPH in a transfer agreement with the surgery center.

“We’re really just focused on running the hospital here and making sure that we stay successful,” Davis said. “The community owns us and we want to remain successful for our community.”

Gear called CPH’s denial of an agreement “heavy-handed behavior” and said it actually hurts the hospital.

“Right now they’re forcing us to only see all the most profitable patients,” Gear said. … “And we don’t think it’s fair that the hospital take on all the burden of  all the lowest (reimbursed patients). I mean we should be helping them do that.”

Davis said while Medicaid and Medicare patients are low-payers, CPH is “very happy” to treat them.

If the surgery center is unable to get a local transfer agreement, the center would have enough business without government-insured patients to be profitable. While being profitable is an obvious goal of the center, another is to treat 100 percent of the patient population, Gear said.

Davis said 26 percent of the hospital’s business is Medicare and 16 percent is Medicaid. About 30 percent of the hospital’s business is insured patients.

“The reality is we would not see many (Medicaid and Medicare) patients leave here,” Davis said. “It would be more the insured folks.”

While Gear thinks the surgery center is more cost effective and more convenient than the hospital, if CPH doesn’t enter a transfer agreement patients are being put at a higher risk. If a patient becomes emergent at the center, it has to transfer the patient to the hospital and with an agreement, CPH would get all the patient information, he said.

 

Kaylee Osowski can be reached at kaylee.osowski@peninsulaclarion.com.

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SXQ
65
Points
SXQ 07/26/14 - 07:44 am
5
0
CPH Monopoly

Sounds to me like the almighty dollar is the drive/force behind CEO Davis and patient care is again compromised!!! Nice work!!

Suss
3648
Points
Suss 07/26/14 - 04:13 pm
3
1
Emergent?

An emergent patient does not sound fun.

Anyone have clue as to how you get to be an "emergent"?

Oh well, at least the lawyers and courthouse are nearby.

leewaytooo
1866
Points
leewaytooo 07/27/14 - 03:48 am
3
2
How? to become an

How? to become an "emergent"

American express card tops the list

then....... visa .... master card....

next up would be repukes for everyone knows

that they come first...or in this case only if they have the

American express card. some wanna b repukes actually

do not have amex card.

then..............whomever has lived in Alaska the longest

goes next and so on.

lastly would be those that have no insurance and

use the emergency care at the hospital because

THEY HAVE NO OTHER CHOICE, other THAN TO

DIE.

herbtr
361
Points
herbtr 07/29/14 - 10:12 pm
0
0
The mayor

What is the mayors position?

healthcarecrusaider
90
Points
healthcarecrusaider 08/04/14 - 10:21 am
3
1
Mayor's Position

Kenai mayor, Pat Porter, presented on Thursday to the CPGH board that she fully supports the new Surgery Center of Kenai and is excited that the borough now has choice in outpatient surgery. She also commented that she was dismayed that the hospital was refusing to grant the surgery center a transfer agreement, since this means that Medicare, Medicaid, TriCare and VA patients have NO CHOICE.
Until CPGH grants a transfer agreement (which Alaska Regional already has) the surgery center cannot get a Medicare number, and can only treat patients with commercial insurance.
I spell that as M-O-N-O-P-O-L-Y!

Allen
632
Points
Allen 08/04/14 - 04:38 pm
2
4
Porter Needs To Be Censured

Mayor Pat Porter had no business lobbying for the Surgery Center. The City Council decides the official City position on political issues, and they haven't decided anything on this issue. So Porter's presentation was by her as a private citizen, (ab)using her official title.

Porter's position is stupid, too. Why should we expect the hospital to help some other business cherry pick away hospital patients? When the hospital loses revenue we all lose, because we taxpayers support the hospital with our property taxes. So Porter was actually lobbying against the citizens' interests.

The Surgery Center should have worked it out with the hospital before they opened for business. Obviously, they didn't. Hope their surgeons are better at their jobs than the business officers.

Chris0803
32
Points
Chris0803 08/05/14 - 03:14 pm
0
0
Allen needs to be Censured

What in earth lead you Allen to conclude that crazy train of thought? You might need to see a provider.....

Being a female new to the community, I am being forced to not go where the care is cheaper and the quality is right in line with a hospital.

I stand for a mayor who stands for me and Pat Porter is extremely smart.... She knows her stuff. She is standing up for all healthcare consumers in the Entire Kenai while the hospital is standing only for themselves. I am glad that a she made that personal appeal to the hospital on behalf of a healthcare comsumer.

It is interesting that you must have missed the part where the surgery center reached out a year ago and multiple times with no response from CPH. This community hospital is willing to use patients as cannon fodder in their attack on the surgery center... I put my trust in those who deserve it.

Smart consumers go where the quality is high and the cost is lower... I will never be blind like a sheep to run to a higher cost facility that bullies others and is willing to use patients as foder... Go hospital where the costs are higher, they attack local providers, and act our vets... yeah gooo..

Hey Allen, if you think we are all stupid northern Kenai residents, you have another thing coming.

GO Pat Porter!!!

healthcarecrusaider
90
Points
healthcarecrusaider 08/04/14 - 07:13 pm
0
0
Porter Was Supporting New Service and New Business

Her 'lobbying' was a 2 minute statement commenting on supporting a new business in Kenai, and a hope that it would be allowed to care for Medicare, Medicaid and TriCare patients.
The hospital has been well run, and as a monopoly enjoys outsized profits, therefore it runs a surplus and does not cost the taxpayers anything.
This whole transfer agreement issue only limits access of Medicare, Medicaid and TriCare/VA patients to the most cost effective outpatient surgery venue available. Most minor procedures that are covered by Medicare and done at the surgery center are paid at 50-55% of the hospital outpatient rate, by law. So, Medicare patients are forced to go to the hospital and the government pays double and the patient has twice the copay.
I'd say Pat was looking out for the little guy!

beaverlooper
2982
Points
beaverlooper 08/04/14 - 09:44 pm
2
0
taxes

She only lobbies for the surgery so the city can collect more taxes. She's not thinking about making it better for you,she's thinking about all the new toys the city can buy with that new income stream.

kenai proud
138
Points
kenai proud 08/04/14 - 09:54 pm
2
1
Porter looking out for Kenai citizens, Hospital blowing funds!

What are you talking about? Of course she doesn't have the full city council's backing.... Bob Molloy, who is the hospital's attorney is on the council and Mike Boyle, who will do just about anything that Bob says is also on our city council. Too bad we have city council members looking out more for the hospital than for us.

First of all, the hospital made 127 million dollars on outpatient services last year. Look it up. They have 6 Operating Rooms and they are charging more than 48 other states' worth of hospitals for services, and it is not the regular 15-30% markup you see in other industries accounting for us living in a rural area, it is 100-400% greater than almost all the lower 48. This is because they, and most of Alaska has effectively boxed out the insurance companies and their networks, and also because they have also boxed out any competitor in our local region.

In fact, because of their monopolistic power, some of their administration has left because they decided to do a price hike that was more than what is usual and customary this year.

I'm okay supporting the local government, but when they go unchecked like this hospital has, and move forward on 43 million dollar expansions without the borough citizens' votes and then decide to move forward on it even after they had the two things turned down from the state that would have actually paid for the whole expansion (they lost their certificate of need for the two endoscopy suites and the radiology suite they were trying to do), I lose all motivation and loyalty. They are blowing our tax dollars and mortgaging our future left and right without a second thought.

Here is something to get us all steaming about even further... This local surgery center had to effectively open up and buy all of its equipment needed for several specialties at less than 1.45 million dollars and our hospital is spending our 43 million tax dollars on a building that will never be able to make our money back on.

No, this hospital's problem is not that they have too little money, or that they will have too little money, IT IS THAT THEY HAVE TOO MUCH MONEY, and they are unchecked as to how to spend it.

The best thing that ever happened for our community is a surgery center that will hopefully save us millions of dollars on healthcare, and hopefully force us all to finally sell our money pit of a hospital to an outside entity that actually knows how to run a hospital.

Suss
3648
Points
Suss 08/04/14 - 10:55 pm
2
1
No tax on medical charges

Medical fees and charges are exempt from sales tax.

Property was improved by the tenant.

Building assessment will probably increase.

kenai proud
138
Points
kenai proud 08/05/14 - 12:47 am
4
1
Porter sticking up for kenai citizens, Hospital wasting taxes

Of course Pat Porter can't speak for all of the city council on this one. Bob Molloy is the attorney for the hospital and is on the council and his good friend Mike Boyle never strays too far from Molloy. It is too bad Molloy and Boyle place the hospital ahead of Kenai citizens. Pat is willing to do what others aren't and that is what makes her so good for our community. Look around and tell me if you don't see a major change for good on things in our city that the city is in charge of...

To correct Allen, or to censure Allen :-), the articles and reporters have stated that the surgery center did try and arrange something with the hospital several times and have consistently hit a stone wall.

Also, to enlighten any who choose to read these comments on our hospital and healthcare in Kenai, I have a few statements.

Statement #1 Why should we work so hard to uphold a hospital that is so intent on spending more money without our representation? They just passed a 43 million dollar expansion without it going to vote to the public, and were supposed to have two endoscopy suites and a radiology suite but the state put a stop to all those revenue generating items and THEY STILL DECIDED TO MOVE FORWARD WITHOUT ANY OF THE ITEMS THAT WOULD EVER HELP PAY IT BACK! KSRM even has sound bites of our favorite CEO, Rick, stating that there was no risk because if they failed to make money, the taxpayers would kick in. They are blowing money left and right!

Statement #2 The hospital isn't concerned with making services less expensive for the community at all. The hospital has 6 Operating Rooms and made $127 million in outpatient services last year alone. Some administration left the hospital because the board wanted to raise the price higher than what was reasonable and customary for our region. They can do this because they are a MONOPOLY. Wouldn't a surgery center that threatens to take away some business make them a little more concerned with prices for the community? It is true that they are a community nurtured and supported hospital. But just what are we supporting them in doing? Would we do the same with our own children?

Statement #3 Alaska has the second highest priced healthcare in the nation! This is not the ordinary 15-30% more expensive industry like the rest in the state. Do your own homework. This is anywhere from 90%-500% more expensive than almost any state in the lower 48? Does that sound like a typical cost of living expense increase to you? Do you honestly think that a monopoly in the Kenai Peninsula helps that situation? The answer is no. One of the biggest reasons healthcare is so expensive is because insurances in Alaska don't have as big of hold on the state medical practices and can't force them to negotiate better prices. Imagine negotiating something with the only shop in town and think of how much leverage you might have... NOT VERY MUCH! But if a competitor comes in all the sudden the prices start dropping. Even if we had a slight increase in our taxes due to mismanagement at the hospital and a slight, and I mean slight decrease in surgeries, imagine what an extra 10+ million dollars back into our economy would do each year because of decreased spending on healthcare...

Statement #4 If this surgery center is locked to one operating room and maybe someday two, then why in the world ISN'T the hospital letting them have all the medicaid and medicare so they fill up and lose their ability to fit in more high paying patients, thus making the shift of high paying patients back to the hospital? This is ludicrous, and anyone that hasn't thought that through on the hospital board or administration doesn't deserve to be there.

Statement #5 I have a cousin who is a top manager in a construction firm in Las Vegas. He just led his crew in retrofitting a wing of a hospital to have a Cath Lab and a COU for 3 million dollars. This brought heart surgery to that hospital for 3 million dollars. We have been told that phase 6 of our hospital is to be a cath lab and women's health building and that it is going to cost us (the citizens and future citizens of the Kenai) 75 million dollars if they don't go over budget!! Where is all this money going?

Bottom line, THIS HOSPITAL DOESN'T SUFFER FROM TOO LITTLE MONEY, BUT TOO MUCH OF IT!

beaverlooper
2982
Points
beaverlooper 08/05/14 - 03:22 pm
1
2
Tell me suss?

Are they exempt from property taxes since building assessment and property value have gone up?
For the hospital, it is a little like private schools that pick and chose the best students and leave special ed ,problem students,students that are not quite as bright and students that in general cost more in time and effort for the public school system,then people gripe about second rate schools and teachers.
They should have gotten a CON ,they are still able to be profitable,they are asking for special privileges.
I lived here when there was no hospital and I have been grateful more than once to have a quality facility I don't have to fly to anchorage to access.
And by the way,ALL medical costs in this state are more than they are else where in this country.I have lived here almost 50 years and it has always been that way,along with food ,cars etc. it is part of the price of living in this beautiful state. Even Walmart isn't as cheap here.

healthcarecrusaider
90
Points
healthcarecrusaider 08/05/14 - 03:27 pm
0
0
CON Facts

A certificate of need is required for any project over $1,500,000 in the AK healthcare biz. It is virtually impossible to get a CON anymore, as the Kahtnu surgery center venture discovered 3 years ago, and as CPH found out this year. As Kenai Proud so eloquently explained, the hospital was handed its derriere by the state in its last $43MM CON debacle. It will be very expensive office space! All of the toys (endos suites, CT, MRI, PET Scanner) were denied.....
The Surgery Center of Kenai was done for around $1,400,000 according to their testimony to the CPH board on Thursday, therefore was exempt from CON per state law.

kenai proud
138
Points
kenai proud 08/05/14 - 04:07 pm
1
0
To beaverlooper and readers

Of course Pat wants Kenai to grow and more money to make it a better place. Look at the projects she is involved in to make our community better. It takes money. Look at what Soldotna is making off of taxes paid there, and it is awesome to see each of these towns improve.

I too am happy to have a hospital here. We needed to rally together to support it early on and we all invested a lot into getting the hospital and its expanded services here. But please understand, or read for yourself in their financials, they are not in that position any more. In fact, they are continually trying to expand, not only into new fields that we don't have here, but into fields and specialties that we already have a strong presence in with privately owned practitioners and their intent, as stated to them from their administration, is that if they are not employed by them, they are competition.

This has gone so much farther than just supporting a hospital that needs our help to be able to offer its services here. They preach of job and health security to the public, when in executive committees and private, they secretly plan on squashing what they deem as competition with all the independently owned providers.... Or at least anyone that won't let themselves be bought out.

In fact, they go farther than just competing head on in fields and specialties that already exist, as if they didn't have endless supply of funds that we are not allowed to vote on not giving them. They go to state and local legislators and complain to them that "greedy" independently owned practices are threatening them so that these independently owned practices have even further problems to deal with just to stay in the business that they were in before the hospital decided to get its own greedy little fingers into it.

If it was a true Non Profit company, then why can we go on the web and find that the CEO is making half a million dollars a year and has incentives given him to grow and take over any possible avenue of healthcare he can?

This hospital either needs to throw out the deceitful disguise as "Nonprofit", or it needs to start acting like one.

Also, if it wants our continued support, it needs to truly partner with not just the surgery center, but all the caregivers on the peninsula. If they did this, I think the hospital would find all the support it needs. It's kind of hard to support something that always bites your hand when you try and feed it....

I follow you on the private school/public school system as far as those that are more fortunate choosing the better alternative and others being left in public schools, but that just brings up another issue. Most of these private schools have much less funding than any of these public schools, and yet, with their limited funding, they are able to attract whoever they want. Why isn't the public school system here in Alaska able to compete?

Those that have to be responsible for their own money and success or failure almost always do better than those that aren't held accountable. We need governmental institutions, that is true, and they need our support. But they also need to be held in check!

Suss
3648
Points
Suss 08/05/14 - 04:17 pm
2
1
Exempt?

If by "they" you meant the Surgery Center of Kenai, then yes they would, since Surgery Center of Kenai is not the owner of the property, so yes they would be exempt.

Landlord may see an increase in value, and higher property tax. From a value of about $500K to almost $800K per the assessors office.

There is always that $30.00 a month tax on the rent that they, the Surgery Center of Kenai would be charged.

Chris0803
32
Points
Chris0803 08/05/14 - 04:30 pm
1
1
Allen comments are extremely insulting and misleading

Since my original post was removed, I am writing again.

I think I and most citizens of Kenai know that what is written above by Allan isn't an out right lie and also Allen must think we are stupid.

We have a hospital using patients as cannon fodder, a nonprofit acting like a for-profit, and they are attacking our veterans.

We have a mayor standing up to that 800 pound gorilla... The gorilla that is the monopoly. And by standing up she went to a meeting on a personal leve and she made a personal plea to a public entity on behalf of a concerned healthcare consumer vantage of people.

Allan we and most of the community are not dumb Kenai northerners.

We should have the right to get healthcare at a great facility at a fraction of the cost.

Our veterans should not be taken advantage of at the hospital like CPH is doing by telling them thank you for fighting overseas and now you have to get your care that comes out of some of your pocket at a higher rate at our higher cost facility. That is so absolutely disrespectful to our veterans and to those parents "MOTHERS".

My blood boils at your comments and how off they are with reality.

Pat Porter is an amazing mayor and I'm glad that she is able to on a personal level understand that cheaper healthcare costs while you cannot... you must be rich and therefore unable to understand what the common woman has to go through to get healthcare and pay for health care for her entire family.

The hospital profits from us the residents and leaches on us the community.

We in the Kenai demand a surgery center that is cheaper than going to the hospital or me driving to Anchorage.

So in my final statement Allen you need to be censored.

corinnep
283
Points
corinnep 08/05/14 - 05:27 pm
1
2
Pat Porter Does Not Represent Kenai

healthcarecrusaider and kenai proud = same person?

No need to get hysterical. All Allen said was that the Kenai Mayor, Pat Porter, was not authorized to speak for the city when she testified. I don't see anything from you (two?) proving she had authorization, just your vicious personal attacks on the other city council members. Like a rabid dog foaming at the mouth. That doesn't help your case.

kenai proud
138
Points
kenai proud 08/05/14 - 10:30 pm
1
0
Corinnep and Allen = Hospital administration? Bob Molloy?

No one's hysterical. Please use actual arguments when joining the debate.Cutting remarks alone without any argument to back them makes you seem amateurish and unqualified. I am happy, though, to read comments that may somehow disqualify mine or make untrue what has been said about the hospital up to this point.

The mayor is allowed to use her title whenever she chooses. In fact, this is a title, that, once she earns it, is hers, even when a mayor comes and takes her place, so no one is speaking out of turn, and in her statement she mentions that she didn't speak for the council.

kenai proud
138
Points
kenai proud 08/05/14 - 11:52 pm
1
0
Just the facts...

Alright, I'll stop the less than polite comments towards certain individuals and hopefully certain bloggers will follow suite so that readers can sift the the crud and get to the meat of the article and comments made. I guess if there wasn't an opposing view, we wouldn't have as much to blog about.

Bob Molloy is a good guy, and same with Mike Boyle, notwithstanding that they would consistently vote to uphold the hospital, regardless of the pile of facts rising up against them. The fact is, that the hospital and borough are Bob's biggest clients and to go against them, even if he wanted to, would be career suicide for him. So do I blame the guy? Not at all. He chose which way he needed to see things, and that is that.

One thing, the insinuation that the blogger "healthcarecrusader" and myself are one and the same is first of all, false, and second of all, a tactic to make blog readers believe that there couldn't possibly be more than two citizens in all of the peninsula that would possibly side for a privately owned surgery center that would drive prices down and help oppose a "community owned" hospital that has become a thousand pound gorilla to patients and competition alike.

Listen to the radio, read the paper, the blogs, the articles... Almost without exception, the talk has been how the hospital has been a monopoly and is using its power to help itself and snuff out competition versus take care of the community that started it.

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