When Jessica Staten’s kidney stones wouldn’t move, she stated, her physician steered a process to “blow ’em up.” She went to have it performed final November at St. Joseph Medical Middle in Bellingham, Washington, considered one of 9 hospitals that the Catholic well being system PeaceHealth operates within the Pacific Northwest and Alaska.
“I was probably there a total of 3½ hours, and everything went well,” stated Staten, who works as an accountant and has medical health insurance. What got here subsequent shocked her: PeaceHealth despatched a invoice for $5,313.63 and, she stated, informed her she didn’t qualify for assist to decrease the price. Staten stated she requested about monetary help however was informed she earned barely an excessive amount of.
PeaceHealth goals to “carry on the healing mission of Jesus Christ by promoting personal and community health, relieving pain and suffering, and treating each person in a loving and caring way,” in keeping with a 2022 tax submitting.
For Staten, struggling lingered lengthy after receiving care from the well being system with the one hospital on the town.
To repay her medical invoice, Staten in the end took on extra debt, utilizing her rental as collateral to safe a line of credit score of greater than $5,000, in keeping with data reviewed by KFF Well being Information. She stated the road of credit score had an 11.2% rate of interest. That was cheaper than a fee plan the hospital supplied via a 3rd get together, which Staten stated she was informed would have charged about 12.5% curiosity.
“It’s all about the money,” stated Staten, who has lived in Bellingham for greater than 30 years. “That’s the way they think now at the hospital.”
PeaceHealth spokesperson Victoria Wilson stated the hospital affords sufferers interest-free 12-month fee plans. For some sufferers, the month-to-month obligation is unaffordable. PeaceHealth additionally now affords longer-term plans with a 9% rate of interest “in alignment with current regulations,” she stated, declining to elaborate additional.
“Each patient who comes to us seeking care is experiencing a vulnerable moment in their life and needs healing,” Wilson stated in an emailed assertion. “We hold each healing opportunity sacred, so financial healing is closely aligned with our Mission.”
The “Ethical and Religious Directives for Catholic Health Care Services,” issued by the U.S. Convention of Catholic Bishops, outlines social accountability ideas for Catholic well being amenities. One states that “a just health care system will be concerned both with promoting equity of care — to assure that the right of each person to basic health care is respected — and with promoting the good health of all in the community.”
As of 2023, there have been simply over 600 Catholic basic hospitals nationally and roughly 100 extra managed by Catholic chains that place some spiritual limits on care, a KFF Well being Information investigation revealed.
Catholic nuns established many hospitals within the title of service. However modern-day practices at such amenities show how they adhere to the directives and church instructing in a method — prohibiting or limiting procedures that the church deems immoral, reminiscent of abortion and what it calls “assisted suicide” — whereas neglecting social accountability requirements, sufferers and clinicians stated.
“It does show the lack of control or influence that the faith organization has over the actual company,” stated Shane Alderson, chair of the Baker County Board of Commissioners in Oregon. The native Catholic hospital owned by Trinity Well being — Saint Alphonsus Medical Middle-Baker Metropolis — final yr shut down its obstetrics division. Its intensive care unit can also be closed, Alderson stated. “You get the feeling when you go to a Catholic hospital that the care and the vision is a lot more defined by the faith,” he stated, including: “It’s not really. It’s corporate.”
Sister Mary Haddad, president of the Catholic Well being Affiliation, stated in a written assertion that Catholic well being methods “remain true to our origins and the missions on which we were founded through our ongoing commitment to serving those most in need.” Along with affected person care, she stated, this consists of investing in applications to deal with societal issues reminiscent of homelessness and meals insecurity.
Well being methods like CommonSpirit Well being, Ascension, PeaceHealth, Trinity Well being, and Windfall St. Joseph pay their chief executives hundreds of thousands of {dollars} a yr — payouts that stored tempo throughout the covid-19 pandemic emergency, in keeping with every firm’s tax filings.
CommonSpirit Well being’s then-CEO Lloyd Dean earned roughly $28 million in 2022; he was amongst almost three dozen executives who pulled down greater than $1 million that fiscal yr, in keeping with the well being system’s tax filings.
Elsewhere, Rod Hochman, CEO of Windfall St. Joseph Well being, earned $12.1 million. Ascension CEO Joseph Impicciche was paid $9.1 million, in keeping with company tax filings.
Spokespeople for Windfall and Ascension stated CEO compensation ranges are market-competitive; CommonSpirit spokesperson Felicity Simmons stated that Dean, who retired in July 2022, like different retiring executives “received standard deferred compensation benefits consistent with their many years of service.” (CommonSpirit’s 2021 tax submitting confirmed Dean earned $35.5 million that yr.)
To keep up their tax-exempt standing, all nonprofit hospitals are required to spend on group advantages, however federal regulation doesn’t specify how a lot or which companies qualify.
A number of giant nonprofit Catholic well being methods spend far much less on group advantages reminiscent of free or discounted care to eligible sufferers and group well being enchancment companies than the estimated worth of the hundreds of thousands they safe in tax breaks, in keeping with analysis by the nonpartisan Lown Institute.
Based mostly on 2021 knowledge, the assume tank discovered that 5 of the ten well being methods with the best “fair share deficits” are Catholic: Windfall, CommonSpirit Well being, Trinity Well being, Ascension, and Bon Secours Mercy Well being’s deficits had been between $488 million and $1 billion.
Analysis by Group Catalyst, a shopper advocacy group, discovered that Catholic hospitals deal with fewer Medicaid sufferers than different nonprofit hospitals, one thing at odds with their mission of prioritizing well being care wants of the poor and underprivileged. And like different hospitals nationwide, many giant Catholic well being methods permit aggressive ways towards sufferers for unpaid medical payments reminiscent of utilizing third-party collections, submitting lawsuits, putting liens, garnishing wages, reporting unhealthy debt to credit score bureaus, or proscribing care to individuals who owe, a KFF Well being Information investigation discovered.
Catholic bishops are “quite zealous for making sure that the reproductive and end-of-life care components of the ERDs are followed,” stated Patricia Gabow, a doctor who led a Denver security web well being system for 20 years and has written concerning the evolution of Catholic well being care within the U.S. She stated “they should be as zealous” on implementing the directives outlining Catholic well being care’s social duties.
Amongst these directives is that this: “Catholic health care should distinguish itself by service to and advocacy for those people whose social condition puts them at the margins of our society and makes them particularly vulnerable to discrimination” together with “the poor; the uninsured and the underinsured”; and “children and the unborn.” The U.S. Convention of Catholic Bishops declined to remark for this text, referring inquiries to the Catholic Well being Affiliation.
PeaceHealth’s first hospital was based within the Eighteen Nineties by nuns from New Jersey who ventured to the West to take care of loggers, millworkers, fishers, and their households within the nation’s distant frontier. Seven nuns and a cook dinner staffed St. Joseph Hospital in Whatcom County, Washington, the place Bellingham is positioned. St. Joseph is the Catholic patron saint of households, employees, and the dying.
Now no nuns serve on St. Joseph Medical Middle’s or PeaceHealth’s management groups; two are on the well being system’s 11-person board of administrators. PeaceHealth CEO Liz Dunne earned $3.6 million within the fiscal yr that ended June 30, 2023, tax filings present, and the Lown Institute estimates the well being system spent $108.7 million much less on group investments than the worth of its tax exemptions. PeaceHealth declined to touch upon govt compensation or the Lown Institute’s findings.
In 2023, the well being system was compelled to refund as much as $13.4 million to greater than 15,000 low-income sufferers after the Washington lawyer basic’s workplace discovered it billed sufferers who ought to have obtained monetary assist.
Catholic well being methods “set a standard for themselves which is higher” than different U.S. hospitals, Gabow stated. “Do they reach what they set for themselves? And there’s a fair amount of data to say probably not.”
Shutting Down Maternity Care
For greater than a century, a Catholic hospital now named Saint Alphonsus Medical Middle has supplied care in Baker Metropolis, Oregon, a ten,000-person city lower than 100 miles from the Idaho border.
The hospital was based in 1897 by nuns from Philadelphia. They handled 115 sufferers within the first yr, “many of whom were loggers, ranchers, and gold miners,” in keeping with a doc detailing its historical past. Sufferers “received complete health coverage” for $1 a month.
Like lots of its friends throughout the nation, the small rural hospital would develop into a part of bigger Catholic well being methods. In 2010 it settled in as a part of Trinity Well being, the nation’s fourth-largest hospital system by variety of beds, in keeping with federal knowledge. Trinity Well being operates 101 hospitals, plus different care websites, in 27 states. CEO Michael Slubowski’s most not too long ago reported wage was $5.3 million within the firm’s 2023 fiscal yr, when Trinity had an working margin of -2%, in keeping with monetary statements and tax filings. Working margins are a measure of a hospital’s monetary well being.
Trinity Well being spokesperson Melissa Lander stated Slubowski’s compensation relies on elements together with expertise and efficiency, and pay “must be market competitive to attract and sustain talented people.”
Baker Metropolis was given a jolt in 2023. Blaming staffing shortages and a decline in births, hospital executives introduced that Saint Alphonsus would shut its obstetrics unit, the one one within the county. The transfer prompted an uproar domestically and pushback by Oregon’s two Democratic senators.
“What they were doing is essentially getting rid of the unit that made no money and cost a lot,” stated Cathie Roach, a nurse who labored in Saint Alphonsus Medical Middle’s obstetrics unit for roughly a decade earlier than retiring final yr.
Roach stated the staffing shortages had been “pretty much of their making.” Hospital administration rotated nurses amongst departments in ways in which made some really feel “really uncomfortable,” and the hospital didn’t contemplate other ways of staffing the OB unit, she stated.
For months, she stated, nurses had been getting hints that executives would possibly shut the start heart and started on the lookout for jobs elsewhere. “Out here if you want to be an OB nurse and this is the only hospital, and they start talking about closing,” she stated, “then, time to get out.”
Hospital leaders stated its obstetric deliveries had “declined at a record rate.” Nonetheless, start knowledge from the Oregon Well being Authority tells a special story.
Births on the Baker Metropolis hospital declined to 103 in 2015, a virtually 30% drop from 2013, earlier than rebounding. Annual births had been within the 120s or 130s till the covid-19 pandemic took maintain, after they fell 25% from 2019 to 2020. Nonetheless, from 2020 to 2022, between 100 and 112 infants had been delivered annually.
Saint Alphonsus Well being System and Trinity Well being declined to remark.
Now the closest hospital the place an individual may give start is over 40 miles away. Within the winter in jap Oregon, roads to get there are sometimes closed.
In 2023, 54% of Baker County resident births had been paid for by Medicaid, the well being protection program for individuals with low incomes, in keeping with Oregon Well being Authority statistics. That’s the next share than Medicaid-covered births statewide.
“They really lost their charity,” Roach stated, “when the old nuns disappeared.”
The Attain of Market Energy
The actions of Catholic well being methods can have an outsize influence due to their attain, fueled by mergers lately: 4 of the ten largest U.S. hospital chains by variety of beds are Catholic, in keeping with federal knowledge from the Company for Healthcare Analysis and High quality.
Haddad famous that that energy has labored for the great of susceptible populations.
The affiliation and many of the Catholic well being methods criticized the Lown Institute report on group profit spending as flawed for excluding a number of classes reported to the IRS, together with uncompensated care prices and spending on well being skilled schooling. Haddad referred to as the analysis an effort “to disparage the work of Catholic health care by publishing misleading and biased reports that cherry-pick data.”
The Lown Institute considers 5 classes of group investments, together with monetary help for sufferers, group well being companies, and well being companies reminiscent of free clinics and habit remedy.
Ascension spokesperson Sean Fitzpatrick referred to as the report an “exercise in misinformation”; Trinity Well being’s Lander stated it “gives inaccurate and, unfortunately, misleading conclusions.” Bon Secours Mercy Well being spokesperson Maureen Richmond stated that the report “utilizes flawed high-level assumptions and incomplete data” and that the well being system’s group profit spending in 2021 exceeded the worth of its tax exemptions by greater than $274 million — whereas Lown calculated that its profit fell in need of tax exemptions by $488 million. Windfall spokesperson Melissa Tizon stated Lown’s methodology “falls short.”
The CHA and a number of well being methods declined to reply questions on whether or not sure enterprise practices raised by this story had been in step with the mission of Catholic well being care.
Years in the past, Catholic hospital mergers had been motivated primarily by ministry, stated Lawrence Singer, a retired affiliate professor who was affiliated with Loyola College Chicago College of Legislation. However issues have modified.
“It really isn’t ‘save the ministry’ any longer,” he stated. “It’s really business that’s driving a lot of this now.”
Consolidation raises market energy, and several other research have discovered that it results in increased costs for sufferers whereas the standard of care stays regular or declines.
The Federal Commerce Fee has blocked sure offers it predicts might cut back competitors. Traditionally the company has focused transactions during which hospitals function in the identical market, in keeping with antitrust regulation consultants. State regulators have broader authority than the federal authorities, however most states can’t reject proposed mergers with out going to courtroom, in keeping with researchers on the College of California Legislation-San Francisco.
Among the largest Catholic well being methods, together with CommonSpirit Well being, Windfall St. Joseph Well being, and Trinity Well being, achieved their dimension as a consequence of a special technique: combining firms with little to no geographic overlap. Such “cross-market mergers” are historically tougher for the FTC to dam, in keeping with well being care antitrust consultants.
When hospitals in the identical market attempt to merge, “in some ways it’s a lot easier to quantify what’s going on” and the potential hurt to competitors, stated Kevin Hahm, an antitrust lawyer at Hunton Andrews Kurth and a former FTC official who investigated well being care transactions.
However offers involving hospitals in several areas are more and more drawing scrutiny. Researchers on the College of California-Berkeley, UC Legislation-San Francisco, and the College of Auckland discovered that well being methods that acquired hospitals greater than 50 miles away elevated costs by 12.9% after six years in contrast with hospitals not concerned in mergers or acquisitions.
“The new frontier,” stated Thomas Greaney, considered one of that merger research’s authors, “is whether we’ll go after what we’ve called system power.”
‘We’re a Captive Viewers’
Bellingham is among the nation’s least aggressive hospital markets: In 2021, it was the fifth most concentrated within the U.S. and had the best well being care costs of metro areas in Washington, in keeping with the nonprofit Well being Care Value Institute.
The nuns who established PeaceHealth’s first hospital would open or function others all through the twentieth century. PeaceHealth additionally acquired hospitals via mergers, together with Southwest Medical Middle in Vancouver and United Basic Hospital in Sedro-Woolley.
“PeaceHealth is the leader in all three of its markets, with decided market share leads in its Northwest and Oregon markets,” credit score scores agency Fitch Scores reported in March. PeaceHealth declined to reply questions on whether or not a need to cost increased costs drives market choices.
Its hospitals stand out for what they’re paid. Rand Corp. researchers informed KFF Well being Information that industrial well being plans in 2022 paid PeaceHealth’s Washington hospitals 314% of what Medicare would have paid for a similar companies. These are the highest-priced charges amongst well being methods within the state, in keeping with Rand’s evaluation. PeaceHealth declined to remark.
Staten’s medical invoice from PeaceHealth is gone: She used the house fairness line of credit score to pay it off. Now she’s paying extra on her mortgage each month.
She stated she will’t afford to have one other expertise like her kidney stone surgical procedure, which she was informed concerned a laser to interrupt the stones into smaller items.
“It’s not like you’ve got three hospitals to choose from,” Staten stated. “We’re a captive audience.”
