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UConn, Hartford Hospital Have Proposal For Health Center

Merger Plan

DANIELA ALTIMARI and MARK SPENCER

November 22, 2008

The financially troubled University of Connecticut Health Center and Hartford Hospital are proposing a merger that would dramatically reshape the health care landscape in Connecticut.

The agreement, with many of the details yet to be worked out, would essentially turn the operation of UConn's John Dempsey Hospital in Farmington over to Hartford Hospital, with the merged operations having more than 1,000 beds.

A statement released Friday by UConn envisions one entity on two separate campuses. Dempsey would still be owned by UConn, but it would be run by Hartford Healthcare, Hartford Hospital's parent company. The Hartford campus would continue to be owned and operated by Hartford Healthcare.

The plan, which will need legislative approval, also envisions significant changes at the aging Dempsey campus. How much that would cost, and who would pay, have yet to be determined.

Without some sort of a deal, though, many agree that the UConn Health Center's future is grim.

The 224-bed John Dempsey Hospital is too old and too small to survive without cooperation from area hospitals. The hospital has struggled financially since it opened in the 1960s, and in recent years it has relied on yearly emergency infusions of tax dollars from the state legislature. Dempsey's deficit this year is $12 million, and climbing.

The partnership with Hartford Hospital, with nearly four times as many beds, would offer UConn a way out of the financial quagmire, UConn President Michael J. Hogan said.

"It would give us the economies of scale we need," he said. "It sure beats going back to the legislature and to the governor every year, hat in hand, asking for another $20 million to cover a structural deficit that's not going to go away."

Elliot Joseph, president and CEO of Hartford Hospital, said his institution is thrilled that UConn has embraced its proposal. In July, the Health Center issued a four-page invitation to hospitals across the state, hoping at least one would step up and help pull the center out of its financial morass.

"While there remains a lot of work to be done to bring this vision to reality, we remain optimistic and look forward to working with UConn on our plan for a world-class university hospital, a top-tier medical school and improving the health care of the people of Connecticut," Joseph said in a written statement.

Under the proposal, UConn would still own and operate the medical school in Farmington.

In addition to being aligned with the new, combined hospital, though, alliances would be formed with St. Francis Hospital and Medical Center, the Hospital of Central Connecticut at New Britain General, and Connecticut Children's Medical Center in Hartford. This new "Connecticut Health Collaborative" would focus on public health, research and teaching, among other aspects of health care.

Ultimately, all of these partnerships could lead to the creation of a world-class health care facility and academic medical center that would draw top researchers —and big-time grants — to Connecticut, Hogan said.

"If we can stabilize the bottom line, we have the potential to become one of the great academic hospitals in the country," Hogan said. "The research dollars we can garner will grow exponentially. ... The potential for this to be a real economic driver is enormous."

But legislative leaders, who have grown exacerbated with using state money to prop up the health center, are less sanguine.

"I'm just not persuaded with what I have here that this is the best, or only, solution," said Sen. Mary Ann Handley, D-Manchester, who co-chairs the legislature's public health committee.

Handley said the partnership between UConn and Hartford Hospital appears to be the cornerstone, with other area hospitals relegated to a lesser role. She said the needs of those institutions will have to be addressed when details of the proposal are finalized.

"If it's a vibrant and intensive relationship, it may succeed," Handley said.

State Rep. Denise Merrill, D- Storrs, co-chairwoman of the appropriations committee, said the proposal is a positive development, with the potential to provide lower costs through increased efficiency. But, she added, the economic landscape has changed so dramatically in recent months that budget concerns will be the dominant theme of the upcoming legislative session.

In addition to selling the plan to lawmakers, there are other details to be worked out when uniting two facilities, with their individual cultures and hierarchies, under one umbrella.

The doctors, nurses and other personnel at UConn are state workers, and many of them are covered by union contracts that offer higher wages and better benefits than the private, nonprofit hospitals. Most Hartford Hospital employees are not unionized.

Employees of the Farmington facility will remain state employees and maintain their rights under collective bargaining agreements where applicable, according to the framework released Friday.

Another major question is the fate of Dempsey, "a small, old hospital with a bad payer mix," Hogan said.

In 2007, UConn officials said they wanted to spend $495 million to build a new, 352-bed hospital in Farmington to replace Dempsey.

The Health Center's urban competitors immediately cried out, claiming that a new facility in the prosperous Farmington Valley would lure their privately insured patients to seek care in the suburbs, leaving them with the financial burden of caring for the region's poor.

Dempsey would be renovated or, more likely, rebuilt, but the new hospital would include the same number of beds. It would be the flagship teaching hospital for the schools of medicine and dental medicine and the primary site for the clinical research activities of the medical school.

All of the parties would continue working out the details before the plan is formally presented to lawmakers, Hogan said.

The alternative, he said, is "continued bleeding."