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Community Health clinics go to war over split of tax dollars

STORY BY MEG LAUGHLIN, (Week of March 8, 2012)

A nasty fight has developed between the county Hospital District, which funnels property tax dollars to pay for local health care for the poor, and one of the agencies it funds.

For several years, leaders of Treasure Coast Community Health (TCCH), which runs five clinics in Indian River County, have complained to the seven elected trustees of the Hospital District that it gets short-changed when the money is divided up.

Trustees have reacted by continuing to give the Treasure Coast clinics – providers of  primary medical care, dental and behavioral health care for about 17,000 poor people –  just a sliver of the $13-million dollar property tax pie.

The back and forth erupted last week into a full-fledged rebellion when TCCH fundraiser Steve Dorrance made an end run around the Hospital District and sent a letter criticizing it to Indian River County commissioners.

“I wanted to get what’s happening out there. I wanted to apply political pressure,” said Dorrance.

“And, possibly, make a case to the county for funding since we can’t seem to get it from the Hospital District,” said Vicki Soulé, executive director of Treasure Coast.

When Ann Marie Suriano, the district administrator, learned of the letter, she was annoyed. “If I wrote something to county commissioners about Treasure Coast Community Health, I would make sure they saw it,” she said. “Mr. Dorrance should have come to my board and me.  I’m all for free speech, but I suspect that letter won’t gain him the ground he needs.”

That ground, according to Dorrance, is to make the distribution of Hospital District money “more equitable,” which would mean Treasure Coast gets more of it. If that doesn’t work, Dorrance wants to convince county commissioners to come up with money for Treasure Coast, as they do for the county Health Department.

“I’ve been to the Health District trustees over and over to make our case and they don’t budge,” said Dorrance. “So, it's time to take a risk and try something else.”

Dorrance’s letter to commissioners begins:  “Over the last few months, we’ve had a number of casual conversations about healthcare cost and delivery in the county. I’ve spoken about the seemingly arbitrary nature by which the Hospital District makes funding decisions and measures efficacy. I have raised concerns about the disproportionate funding IRMC (Indian River Medical Center) receives, despite the availability of much more cost effective alternatives.... I would like your personal support to change the status quo.”

In 2011, IRMC treated about 20,000 poor patients in its emergency room and about 10,000 more in its child-birth Partners Program. The medical center got about $9 million from the district for 30,000 patients.

By contrast, Treasure Coast clinics treated about 17,000 indigent patients in 2011 – more than the number treated by IRMC – and it got $216,000 from the Hospital District.

The Visiting Nurses Association mobile health-care van treated almost 4,000 patients in 2011 – less than a fourth of the number of patients treated by Treasure Coast – and got $437,000 from the district. The Mental Health Association treated about 1,500 people last year and got $401,000 from the district – again, about double the money given to the Treasure Coast clinics.

“Arbitrary, disproportionate funding?” as Dorrance accuses.

No, said Suriano, the district administrator: “The funding decisions are based on a number of complex, well-thought-out reasons.”

For example, the district was set up over 50 years ago for one single purpose – to pay for hospital care for the poor. While it has broadened the agencies it gives money to, its priority remains the medical center.

“We take our  long-standing contractual obligation to the hospital very seriously,” said Suriano.

As for the visiting nurses' van that travels the county, it is totally supported by the district, unlike the six other agencies the district helps, which have other sources of money.

And the Mental Health Association’s funding from the district is based on volume and cost per patient, as is district money for almost all of the agencies – except for the Treasure Coast clinics.

That  patient-based formula gives the other agencies more money.

The reason for the discrepancy  goes back to 2008, said urologist Hugh McCrystal, former district board chairman.

At that time, the district hired independent auditors to verify the number of patients Treasure Coast clinics told the district it had. To receive health care, a poor person had to have an income of not more than 150 percent of the federal poverty level – about $33,000 for a family of four – and be an Indian River County resident. (The district also hired accountants to audit the other agencies that received money. The numbers from the hospital, the VNA mobile unit and the Mental Health Association  matched what auditors found. )

With Treasure Coast clinics, auditors said patient numbers were greatly inflated because the patients they studied hadn’t proven they were poor. From then on, the district only matched state funding for Treasure Coast at a small percentage instead of giving the clinics direct funds based on patient volume.

“What were we to do when the audit numbers didn’t come close to what they said?”  asked McCrystal.

Dorrance had a ready answer: “That was four years ago. We’ve had the paperwork in order ever since. Get over it. Move on.”

Treasure Coast paid $71,160 back to the district for its mistakes. 

But the district continued to cut way back on funding to TCCH, even though the clinics were treating more and more indigent patients.

Another reason the district doesn’t give Treasure Coast more: Its clinics got $2.1 million from the feds last year.

But Soulé, Treasure Coast's executive director, said that money can only be used to fill the gap between what poor patients pay on a sliding scale and what it costs to treat them. It can’t be used for equipment, rent, hiring doctors and nurses or any other expenses.

“We’re not fat, dumb and happy,” said Dorrance. “We’re providing a huge service to the poor in this county and to do it, we’re operating at a loss.”

A loss? All the more reason, say district trustees, to be cautious in supporting the clinics: “What kind of a business plan is that? It doesn’t make sense to grow a business if it’s losing money,” said radiologist Tom  Spackman, the district board chairman.

In 2011, Treasure Coast opened two new clinics, which, Soulé said, they were obligated to do to fulfill the federal recommendation that they provide “accessible health care.”

Records show the nonprofit  to be operating at a loss of $160,000.

While Spackman calls Treasure Coast's business plan a "black hole,” he is quick to say he’s a fan of what the clinics accomplish for the sick and poor. They provide ”a medical home” with preventive primary care and dental care to the county’s indigent at a reasonable price, he said, unlike the hospital emergency room, which only treats on an emergency basis and charges a lot more than Treasure Coast.

“Enough with playing hardball,” said Spackman. “Treasure Coast offers very good service, but we need them to come to the table and clearly explain what they want to be when they grow up.” 

In the meantime, a governor-appointed commission looked into Hospital Districts in Florida concluded in December that they should “require the maintenance  and/or expansion of community health programs with emphasis on primary care and emergency room diversion.”

That's potentially good news for Treasure Coast except state funds that match and increase money for public health have been drastically slashed. What that means is money for the county department of public health will have to be allotted by the Indian River County Commission, putting a larger burden on commissioners.

Which, in turn, could mean commissioners will be less inclined to give Treasure Coast a chunk.

“Why would we want to get involved in what the Hospital District has spent decades doing when we know nothing about it?” asked Commissioner Bob Solari.

But Commissioner Peter O’Bryan sees it differently: “I plan to read as much as I can on the district so I can make an informed decision about whether we should become involved. It all boils down to only three votes by commissioners.”

The final word in the continuing battle between Treasure Coast and the Hospital District goes, at least for the moment, to the district: “Mr. Dorrance, more power to you if you think you can have more luck with the county commission than the Hospital District,”said Suriano. “We’ll see you when you apply to us in April.”