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The PBC fight
City council takes on the control board
(Published February 26, 2001)
By KATHRYN SINZINGER
The presidentially appointed financial control board, due to turn back control of the D.C. government to local elected officials at the end of the current fiscal year, appears poised to defy a majority of the elected D.C. City Council by approving a contract that will displace the District’s public health care system with private contractors.
Few details have been made available about the bids that were submitted earlier this month in response to the control board’s request for proposals to replace the financially troubled Public Benefit Corp.’s operation of D.C. General Hospital, its network of six community health clinics and the school nurse program.
But a deadline for public officials to do something is looming as the Public Benefit Corp. (PBC) is expected to run out of money around March 15 due to a congressionally imposed ban on the city continuing to subsidize the PBC’s operations.
The control board announced it is negotiating a contract with Doctors Community Healthcare Corp., which owns Greater Southeast Community Hospital, after selecting that company’s bid over one submitted by a group that included the PBC’s current chief executive officer, Michael Barch.
Doctors is believed to be seeking a five-year contract totaling about $416 million to provide health care services for the city’s uninsured residents. Local health care industry critics of the plan to "privatize" the city’s 195-year-old D.C. General Hospital have noted this amount is approximately equal to what the PBC currently spends.
Organized labor has been in the forefront of opposition to privatizing the PBC’s operations, which could result in the loss of 1,250 jobs. The American Medical Association, the D.C. Primary Care Association and the D.C. Hospital Association are among the many other organizations that are opposed to the current plans to effectively eliminate D.C. General Hospital’s services.
The lack of concrete details about what is happening behind closed doors to dismantle the city’s publicly operated heath care network has fueled the political rhetoric at a flurry of public meetings, press conferences and protests in recent weeks.
A D.C. City Council hearing Feb. 23, at which D.C. Department of Health Director Dr. Ivan Walks testified, presented the public with little more than another session of highly charged attacks and finger-pointing. Walks himself walked out of a Feb. 13 meeting of the Kingman Park Civic Association when he came under attack by the crowd in attendance. D.C. General Hospital is adjacent to the Kingman Park neighborhood.
Council members Kevin P. Chavous, David Catania, Sandra Allen and Carol Schwartz have vocally criticized Mayor Anthony A. Williams for supporting a plan to turn over the public health care system to private contractors rather than working to adequately fund the public system.
"I believe this all could have been avoided," Allen, who chairs the council’s human services committee, said during an impassioned speech at a Feb. 12 press conference. "Had the mayor responded to this crisis with a plan that sought to save this hospital instead of closing it, we would not be here today….We’re here today because the mayor has failed to work toward a solution that would save a hospital."
Catania has recently focused his attention on what he has described publicly as the "poor financial health" of Scottsdale, Ariz., based Doctors Community Healthcare Corp., the company in line to take over the District’s health care "safety net" for the uninsured. The at-large councilman has questioned why it makes sense for the control board to hand over a financially troubled public health care system to a private company that appears to have financial problems of its own.
"We’re going to turn over at least $76 million a year to a company that has never made a cent," Catania said during a recent public hearing discussion about D.C. General Hospital with advisory neighborhood commissioners. "I can't see that a for-profit company that loses money will go out of its way to serve (the public)," he said.
Officials at Doctors Community Healthcare Corp. did not respond to a request for comment.
Doctors purchased Greater Southeast Community Hospital out of bankruptcy slightly more than a year ago after the mayor’s office and the control board became involved in negotiations to save the Ward 8 hospital from closing.
Prior to the sale, the city provided Greater Southeast’s owners with $8.5 million in loan guarantees to remain operating. It is unclear whether the D.C. government continues to have a direct financial interest in Greater Southeast’s operation. Control board staff did not respond to a request for clarification of the city’s financial involvement in that transaction.
Doctors Community also owns Hadley Memorial Hospital in Ward 8, which it earlier this year converted to a long-term acute care facility.