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Handing New $475 Million Facility To Hartford Hospital And Paying Extra To Run It Isn't The Only Option

JOHN MCKINNEY

February 22, 2009

The General Assembly must proceed cautiously as it evaluates the proposed public-private partnership between the University of Connecticut Health Center and Hartford Hospital, which would require the state to finance a new "University Hospital" at a cost of $475 million for construction and at least $13 million annually in increased labor costs. But even before the legislature grapples with the question of when and how to fund nearly $500 million in new spending at a time when taxpayers cannot afford it, we must first determine whether this solution would make sense even in good economic times.

In January 2007, the health center and the UConn board of trustees first proposed construction of a University Hospital to replace and expand the aging John Dempsey Hospital. The proposal, which relied heavily on tax dollars to cover its then $495 million price tag, prompted the legislature to commission the Connecticut Academy of Science and Engineering to conduct a needs-based analysis.

All parties agreed that it was in Connecticut's best interest to help the health center maintain its level of excellence, and that, in order to do so, its current operating model must change. After all, in each of the past two years the health center has operated more than $20 million in the red and depended on taxpayer bailouts. The academy study was intended to help the legislature determine how the health center must change.

Following a 12-month review, the academy reported in March 2008, concluding unequivocally that ownership of a hospital is not a determining factor in the success of a university medical program. Rather, as the report states, "the key to success is often relationships, governance structures and clearly articulated financial relationships."

Moreover, the academy found that there will not be a need for additional hospital beds in the Greater Hartford region until at least 2020. That need will be easily met if Hartford Hospital and St. Francis Hospital follow through on expansion plans they started long before the partnership between the health center and Hartford Hospital was proposed. As such, the study recommended that the health center's efforts focus first on "formalizing, strengthening and reinforcing relationships with current clinical care partners, and exploring relationships with other interested clinical care partners."

Given these findings, it is surprising that just a year later, the academy has rubber-stamped a proposal requiring the construction of a new University Hospital. In its latest report, released Jan. 30, the academy contemplated only whether or not the health center/Hartford Hospital partnership would work. The report never indicated it was the only plan that could work, nor was the academy charged with finding a more affordable alternative.

Of course a new University Hospital would improve UConn's medical school, but at what cost to taxpayers? What about other hospitals in the area? And is it the best way to improve the health center?

If the legislature approves this plan, the $475 million construction cost is just the tip of the iceberg for Connecticut taxpayers. The proposal requires the state to pay a minimum of $13 million a year to run the new facility, which is an admission that the plan will not solve the underlying reason for the health center's financial difficulties.

It is also worth noting that in early 2007 all of the other hospitals in the Farmington Valley, including Hartford Hospital, asked the state to reject UConn's plan, fearing that competition from a larger University Hospital would hurt them financially. At the time, representatives from Hartford Hospital personally thanked me for my opposition to the new hospital, and their lobbying efforts against UConn's proposal were widely reported.

So why has Hartford Hospital had such a dramatic change of heart? Is it because this new hospital would be modestly smaller, or because it would now stand to benefit from millions of dollars in annual state aid it could realize through a partnership with UConn?

It is my hope that the legislature rejects the new University Hospital and demands that the health center first exhaust all efforts to strengthen its partnerships with other hospitals in the region, and develop mutually beneficial ways to pool resources and create efficiencies that will strengthen the medical school program. Although small steps have been taken in that direction, there is no indication that the full potential of those relationships have been realized or even fully explored.