Despite the claims of the county executive that the lease will improve the delivery of health care to county residents, the lease fails. It will unquestionably increase the costs all Prince Georgians pay for health care and cancel the open door policy that was the foundation of the system. It inadequately defines current levels of community service and fails to state who will pay for what.
The county now operates its hospitals on a non-profit basis. The rates charged by all hospitals in Maryland are regulated by the state's Hospital Cost Review Commission (HCRC) and include a percentage for charity and up to 14 percent profit for profit-making institutions. Under the lease, rates would be adjusted upward immediately to cover HCA's payment of property taxes. In 1986, the rates would again be raised to include a profit for HCA. Every workers' health insurance premiums would rise because they reflect the costs of health care statewide. Government must also pay the higher state commission rates through Medicare and Medicaid. Health services puchased by the county, such as the care of prisoners, must cost the taxpayers more. No profit-making corporation will render care beyond that provided for by its rates and subsidies.
The lease holds many hidden costs, for the taxpayer. Under county management of the hospitals, for example, contributions from charitable trust funds have been used both in construction and providing services. The hospitals receive donated funds of over $300,000 annually for services and equipment. Two of the trusts alone represent over $10 million of future donations -- donations that reduce taxpayer subsidies. The continued receipt of those contributions would be seriously jeopardized by the profit-making status of the hospitals under the lease arrangement. The loss of the funds would diminish the present volume of services, particularly for children.
Because of the inevitable increase in health care costs associated with the lease by a profit-making corporation, many of us have questioned the reasons for a lease arrangement when other options are feasible. In 1970 a consultant recommended creation of non-profit hospital authority, as did a special committee appointed by the county executive in 1980. Recently a county council task force studying the lease offered no fewer than five other options for managing the system without a profit margin.
With this long-term lease (up to 31 years) and its vague repurchase provisions, it is doubtful that the county could afford to regain control of its hospitals. HCA would pay $3.4 million each lease year plus a "bed rent." These revenues would be retained by the county in a reserve fund out of which the county would be required to buy all equipment, purchased at HAC's sole discretion, and its accounts receivable. The council task force projections of repurchase costs for the year 2002 would be significantly more than the receive fund balance. What real choice does the taxpayer have then?
The lease requires that the county pay up to $500,000 annually, adjusted for inflation, for community services and charity care for those patients unable to pay the entire cost of care and for any of HCA's costs of providing those services not fully reimbursed through federal, state or private programs or insurance. Since the lease does not define current levels of community services, if the county attempts to monitor HCA's performance, there would be no standard by which to compare the care provided before and after the lease.
The county executive insisted that the lease prohibit abortions in the facilities except to save the life of a mother. HCA agreed to the inclusion only with the provision that any costs of associated litigation would be paid by the county.
The council must now consider the mission of the hospital system and its health services rendered to Prince George's citizens since 1948, and how those services can continue most efficiently and remain responsive to the community.