In Defense Of The Big Charity Plan

Editor’s note: Dr. Jack Andonie is a long-time friend of the Hayride, and he’s also an expert on healthcare matters and LSU. With the controversy surrounding the proposals to build a $1.2 billion medical facility to replace the old Big Charity hospital, we thought we’d consult him for his opinion on the plan. He’s in favor of it, and he was kind enough to offer this piece as an explanation for why.

Dr. Andonie’s views are his own and don’t necessarily reflect those of our regular contributors…

By Jack Andonie, MD
LSU Board of Supervisors Member


That’s the amount of money available right now to build the new University Medical Center in New Orleans or about 75 percent of the projected $1.2 billion cost of the entire project, including everything down to the last tongue depressor and bedpan.

How many people do you know who can put up three-quarters of the money to build or buy a house? How many government projects are built with that much equity before the first pile is driven?

The State of Louisiana decided as far back as the Roemer administration in the late 80s, to build a new academic medical center in New Orleans to replace the now 72-year-old Charity Hospital building. Katrina just accelerated the timetable.

Politicians and health care official have long acknowledged that they needed to change the state’s health care delivery model from the old “charity” archetype of providing mostly indigent care and trauma services to that of a modern, world-class academic medical center, encompassing not only treatment but also greater research efforts and expanded medical education opportunities.

Some private hospital officials and their political cohorts are in a frenzy, incessantly raising self-serving qualms about the financial impact of the UMC on their profit-making operations how the new hospital allegedly will be an everlasting drain on the state treasury. Skeptics, despite years of support for the new UMC from successive governors and multiple votes by the Legislature reinforced by four separate consulting studies, seem hell bent on killing or controlling the project by dramatically downsizing it to the point where it is ineffective.

Anyone unfortunate enough to be poor and sick faces a real challenge in Louisiana today. Many physicians and “community” hospitals are increasingly forcing Medicaid patients to seek treatment elsewhere. LSU specialty clinics, for instance, are seeing a growing number of cancer patients who have been turned away by large private hospitals. All of us know friends and relatives who have sought treatment for cancer in Houston or Birmingham because of the perception that cancer treatment facilities in those cities are superior to anything available in Louisiana. What about the thousands of cancer victims who cannot afford to go to Houston or Birmingham?

Uninsured patients have known for decades that they are simply not welcome at certain private hospitals and have been relegated to seekingtreatment in the closest emergency room after the sun goes down because federal law says they must be cared for. Private providers understand all too well that they are threatened by the prospect of a modern and competitive hospital that is able to attract and accommodate both indigent and paying patients.

Recently, a draft report prepared by the out-of-state consulting firm Kaufman Hall got a lot of publicity by asserting that the UMC would befinancially “unsupportable.” Critics of the project immediately latched on to the consultant’s claim that the new hospital was too big at 424 beds and should be downscaled to no more than 332 beds.

A 332-bed hospital is half the size of the typical academic medical center that supports only one medical school in the United States. The LSU Hospital in Shreveport, which is an academic medical center and trauma center, has 550 beds that say filled nearly 100 percent of the time for a city of about 375,000 people. The New Orleans area, even with a dramatic population decline since Katrina, still has more than 1.4 million people in the metro area. If anything, the UMC is too small to meet the future needs of the 13-parish New Orleans region.

More importantly, the new UMC will support LSU, Tulane, Xavier, Dillard, Delgado, and Southern University health care training programs. We must have a hospital that is large enough to carry out the mission of caring for the indigent and providing crucial Level One trauma services while training our state’s future doctors, nurses and allied health professionals. Building a hospital that is too small to do that insures financial failure and jeopardizes the accreditation of our highly regarded education programs.

The state is currently buying upwards of $100 million a year in services at the Interim LSU Public Hospital, which is running at more than 90 percent capacity and must close when the UMC is opened in four years. No one has said the state will stop paying for treating the indigent in any version of health care reform.

Conclusions by Kaufman-Hall were deeply flawed and intentionally misleading. Now, the firm says their report was only a preliminary draft. The consultants carelessly missed the point and even admitted later, after their unfinished report was intentionally leaked, that they based their conclusions on what they believed is the intent to replicate the old safety-net hospital model.

The UMC, however, is designed to be a training site for more than 2,000 medical and allied health professionals a year. Louisiana faces an imminent shortage of doctors because a majority of physicians in our state are in their 50s and 60s. LSU trains more than 70 percent of the physicians in Louisiana, more than any other institution. That training would be severely restricted without a training site large enough to meet the need. Private hospitals are simply not big enough nor do they have the high volume and variety of patients necessary to support accredited medical education programs for more than 2,000 medical students a year.

As far as construction costs, it’s likely and perhaps even probable that the state might not have to borrow any money to build the medical center. Delaying construction further while opponents look for any analysis that supports their antagonism could be costly. Each month of delay means an estimated increase of $1.5 million in construction costs. The bottom line is that the UMC could be built for less than its estimated $1.2 billion cost.

Opponents also expediently ignore the projected economic impact of the combined UMC and VA medical centers that are expected to generate $9.6 billion in personal earnings over the next 20 years and create more than 17,000 jobs in the New Orleans metropolitan area. Those should be the numbers that count.

The state should immediately start using the funds available to start construction. Build the hospital now. Delaying further while those determined to kill or control the project raise artificial concerns will mean certain disaster for health care delivery and graduate medical education in our state.

By definition, every decent-sized academic medical center in the country is competitive. What Kaufman-Hall and UMC opponents expect the people of Louisiana to accept is an operating model guaranteed to collapse. That kind of thinking, if applied, would financially cripple the medical center within days of opening while blocking our universities from developing advanced and specialty programs we desperately need.

Isn’t anyone struck by the fact that New Orleans does not have a comprehensive cancer center and that a prominent Houston cancer hospital run by the University of Texas spends tens of thousands of dollars a year on New Orleans TV to attract patients? How many cancer victims must leave Louisiana in an attempt to save their lives? Why are some for-profit medical enterprises determined to make sure they have no real competition while trying to convince us that they are delivering superior and cost-effective health care?

The new hospital is desperately needed and long overdue.



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