The Prince George's County Council has postponed -- possibly until fall -- a decision on County Executive Lawrence Hogan's proposal to lease the county's three hospitals to a private corporation.
By a unanimous vote, the nine council members present at Tuesday's meeting rejected without prejudice, meaning they can reconsider the question later, an executive order that would have cleared the way for the Hospital Corporation of America to lease the county hospital system for 21 years, with a renewable option of two five-year terms. The executive order would have permitted the hospital lease, which Hogan signed May 6, to become effective July 6.
Under its rules, the 11-member council can delay a final vote on the lease until the entire body has been briefed on the exact provisions and can study more throughly a report on the subject by a council-appointed task force. No date has been scheduled yet for hearings, and some council members speculate that it may be September or October before the hearings begin.
The 891-bed county hospital system includes Prince George's General in Cheverly, Greater Laurel-Beltsville in Laurel and the Bowie Health Center.
Under Hogan's proposal, the county would retain ownership of the hospitals, but the HCA would manage the facilities. The county would be locked into the lease for a minimum of 16 years unless it could prove the HCA had violated the terms of the lease. If the county should then choose to reenter the hospital business, it would have to repurchase the assets it now plans to lease to the HCA, because with an average life expectancy of 10 years, virtually all the hospital equipment would have been replaced at least once and possibly twice.
Since his campaign for county executive in 1978, Hogan has contended the hospitals could be run more cheaply and efficiently by a private company.
"The hospital system has been getting further into debt over a period of years," says Lawrence Hogan Jr., an aide to his father. "The county is not in a good position to run hospitals."
According to William Brown, a county official who served as chairman of a committee reviewing the financial aspects of the lease, the county has given $8.2 million in subsidies to the three hospitals since 1972, or an annual average of about $1 million. For example, in fiscal 1979 the county subsidized the hospital system by $1.7 million, and in fiscal 1980 by $1.5 million.
Under the terms of the lease, HCA would pay the county $3.4 million in annual rent. Of the $166 million total the county expects to receive over the 21-year lifetime of the lease, it is estimated that $96.7 million would remain in the county reserve fund after the county paid approximately $69 million for indigent and community care services and debt services.
If this estimate is correct, the county over the course of the lease could expect to earn about $7.9 million, compared to the $1 million a year it is currently paying out.
Critics of Hogan's proposal are troubled by the prospect of the county handing over a public hospital to a private company whose operations they feel the county will be unable to control.
A more specific concern is that HCA will not provide the same level of care for the county's poor and elderly residents.
"Right now, the hospitals serve anybody who shows up," said Ann Lombardi, a council member who has been an outspoken critic of the lease. But she worries that in a few years under private management, "If you're not an emergency case, chances are you will not be treated if you cannot pay."
But Jerry White, a spokesman for HCA who negotiated the lease with county officials, denies that care for the poor will be adversely affected.
"Our sense of social responsibility goes the full scope," he says. "We are not trying to provide a narrow segment of health care or health care for a narrow segment of the population. As the leader in the health field, we believe that we should provide medical care regardless of whether someone is able to pay the bill or not."
Critics of the lease see several other problems. Unanswered in the lease proposal, for example, is what would happen to funding from charitable organizations if the county hospital system loses its status as a nonprofit organizaton when it is leased to the HCA.
The American Civil Liberties Union also has objected to a provision in the lease that would severely restrict the types of abortions that could be performed at the hospitals.
ACLU spokeswoman Claire Bigelow, present at a press conference Tuesday that was spearheaded by Betterment for United Seniors -- which represents more than 6,000 county residents -- raised the issue of the controversial anti-abortion clause written into the lease.
"The secton that restricts abortions in the contract is blatantly illegal," said Bigelow. "If it (the hospital lease) is passed, we plan to go to court to fight it. We do not feel the county government has the authority to do this."
Faith Loveless, a member of the senior group, worries that a senior citizen clinic may be eliminated and suggests an analogy.
"This whole thing reminds me of a big cake," she says. "On the outside it looks beautiful, but when you bite into it the inside tastes like yuck."