- 2 days ago
An examination of how many investor-owned, for-profit hospital chains aggressively market themselves to treat only insured or wealthy patients.
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00:00Major funding for Frontline is provided by the Corporation for Public Broadcasting.
00:12Additional funding is provided by this station and other public television stations nationwide.
00:17And by the Chubb Group of Insurance Companies for over 100 years providing worldwide business and personal insurance through independent agents and brokers.
00:26Tonight on Frontline, the big business of health care.
00:34Profit-making corporations now run one in six U.S. hospitals.
00:39Good for free enterprise, but a threat to public hospitals which treat the poor.
00:44They came in and told me that they was going to have the surgery Tuesday.
00:47Then they come in and said no, that they couldn't find no way for me to pay for it because I didn't have no insurance.
00:53So they told me they couldn't do it.
00:55It's a medical emergency with potential life and death consequences.
01:00A crisis at General Hospital.
01:07From the network of public television stations.
01:11A presentation of KCTS Seattle.
01:14WNET New York.
01:15WPBT Miami.
01:17WTVS Detroit.
01:19And WGBH Boston.
01:22This is Frontline.
01:25Good evening.
01:30I'm Judy Woodruff.
01:3225 million Americans are unprotected tonight.
01:35Unprotected because they have no health insurance.
01:39In just the last year, health care costs have gone up at almost three times the inflation rate.
01:44So that as a nation, we now spend a staggering $322 billion a year on staying healthy.
01:52Government officials and insurance companies have pushed hard to cut these costs, but so far with no real success.
01:59As a consequence, people are beginning to be turned away because no one will or can pay for their medical treatment.
02:07Tonight, producers Graham Chedd and Andrew Liebman take us to Tampa, Florida, a city like many others where the public hospital finds itself under attack on all sides and has started to cut back on medical care for the poor.
02:22It's the story of the crisis at General Hospital.
02:26One final note.
02:27The film contains some graphic medical procedures.
02:30This man's just been stabbed near the heart.
02:56Like most victims of medical emergencies in Tampa, he's been brought to the emergency room at Tampa General Hospital.
03:13What time about did this happen?
03:14Last half hour?
03:16The big question for the emergency team, has the knife nicked an artery or punctured a lung?
03:21No one here is thinking about another question.
03:26Can the victim pay for his treatment?
03:29It's an emergency.
03:30Medical tradition is treat first, ask questions about money later.
03:35But at Tampa General, hospital traditions have begun to clash with harsh new economic realities.
03:42You're a lucky fella.
03:43Wow.
03:44You could be dead.
03:45This institution has a history and a tradition of providing health care to anyone that comes through its doors.
03:54It's never turned anyone away.
03:56It's provided the service that's necessary for minor and serious illness.
04:00We'd hope that this can continue.
04:02Certainly there are increasing pressures on this institution to remain financially stable.
04:07In Tampa, and in hundreds of other communities across the nation, a medical drama very different from those we usually see on television is being played out.
04:19Here, it's the hospital that's fighting for its life.
04:25Tampa General, a large, not-for-profit community teaching hospital, wakes to another day.
04:31But it finds itself in new and baffling times.
04:34It's facing a public angry over rising hospital costs.
04:40It's losing its economic base.
04:42It's paying patients to new hospitals in the suburbs, many run as for-profit businesses.
04:49It's taken on a huge new debt, has just laid off over 300 staff, and for the first time in its history, has begun to turn away the sick.
05:01Joe Lowe knows none of this.
05:02He's here today after months of illness.
05:04Losing weight, strength, and the ability to work.
05:08But the hospital's new policy is that, except in emergencies, patients without funding, private pay patients, in hospital jargon, are to be sent away.
05:17When he came to the screening area of the clinic, the registration area, the clerk that works for me brought me his chart and said that he was not eligible for our clinic services because he was private pay patient.
05:31Now, if I was able to come in this hospital and was able to pay my bill, I think I was supposed to pay it.
05:38Mm-hmm.
05:40See?
05:41But I'm not able.
05:42I don't have no income or no kind.
05:45No job.
05:46No insurance.
05:47So, therefore, you know, I'm out of it.
05:50I ain't got nothing.
05:53And I figure, well, yeah, that's supposed to help me because I ain't able to do it.
06:00Tampa General is the city's hospital of last resort.
06:04It's always taken care of the poor and the indigent with only minimal help from local taxes.
06:17But today's church-sponsored soup kitchen is a sign of the times in Tampa.
06:22So many people can't pay their hospital bills that the hospital's profit from its paying patients no longer covers all the costs of charity care.
06:31That, at least, is the hospital's contention in an escalating war of words over local taxes.
06:39Today is to see another confrontation between the Hillsborough County Commission and Tampa General's director, Julian Rice.
06:47Well, we're going over there to talk about the budget situation as it relates to the hospital authority.
06:52And I guess, in particular, we're going to talk about the amount of funding required to take care of the indigent load or the charity load in this county.
07:03In part because this funding is so low, the hospital claims that for 1984 it will be $11 million in the red.
07:11But we're concerned about your $11 million.
07:14I assume that's your problem, but I feel like we've got to help you with it some way.
07:19But I don't...
07:19What are you going to do if you don't come up with $11 million?
07:22What's going to happen?
07:22Commissioner, we've already started last March, and we started in July, and we started this month, and we'll continue.
07:29And that'll be...
07:30We'll have to make some changes in the amount of services offered.
07:34You're going to save $11 million?
07:36I don't think so, Commissioner.
07:37How much are you going to save?
07:38What's the problem, then?
07:38We're going to sure try to save a lot of money.
07:41But the reason in the process of saving, there are going to be a lot of sick people that don't get cared for in this community.
07:48And that's already started occurring in both the outpatient clinics and the emergency department.
07:52We've cut our emergency department visits by one-third in the last two weeks.
07:56And if they don't have the money or are not certified local welfare or Medicaid-eligible or Medicare, and they're not life-threatening, we don't treat them.
08:09Take the case of Dora Mosley, a 47-year-old widow.
08:14She suffers from a heart condition that will one day kill her.
08:17Her few assets, her trailer, an old truck, her $300-a-month widow's pension, disqualify her from government assistance.
08:27A few weeks ago, in a state of collapse, she went to Tampa General.
08:31I went to the emergency room.
08:33They examined me.
08:35And I stayed in the emergency room from about 2 o'clock in the evening until about 10.30 at night.
08:39And they ran all kinds of testes.
08:42They hooked me up to the heart machine and everything.
08:45And they had me doing push-ups and rated my heartbeat and all of what they do.
08:53And finally, they decided to admit me.
08:56Mrs. Mosley will need surgery because when dye is placed into the left...
09:00The test shows that Mrs. Mosley's heart has a badly leaking valve.
09:04This leakage in the valve will result in heart failure if allowed to proceed over a period of time.
09:12They came in and told me that they was going to have the surgery Tuesday.
09:17Oh, fine, you know.
09:18Sooner the better, you know.
09:19I was scared, of course, but the sooner I get it over with, the sooner it will be better.
09:23Then they come in and said no, that they couldn't find no way for me to pay for it because I didn't have no insurance.
09:29So they told me they couldn't do it.
09:30She was not rejected because we have anything, obviously, against Mrs. Mosley.
09:37We think she ought to be done.
09:39But we think someone has to face the responsibility of paying for this sort of care.
09:46And we don't think that that responsibility is Tampa General Hospital.
09:50But I realize that they've got their job as well as anybody else has.
09:54And they have to show a profit and all of this, you know, and everybody's got to do it.
10:01It's just the way the economies are getting.
10:03With chronic congestive heart failure, which is her major problem,
10:08and a recent episode of severe heart failure necessitating her hospitalization,
10:13I would anticipate several more of these episodes occurring in the next few months.
10:18Every day without surgery, Mrs. Mosley's heart grows weaker.
10:24But by refusing her surgery, Tampa General is saving $20,000 and helping ensure its own survival.
10:31I've been accused by a good many of my friends that, well, you're heartless, you do these things,
10:37you turn people off, why don't you treat them, and so on.
10:41And it goes back to the old analogy, you don't make omelets without breaking eggs.
10:49And we're breaking a few eggs, I'm afraid.
10:52Others are being shut out of Tampa General even if they qualify for financial aid.
10:56Beth Ford, a young mother of two, has come to Tampa General's emergency room
11:03for the second time in the last few days.
11:06She was turned away before, even though she's eligible for Medicaid.
11:12Medicaid is run by the states under federal guidelines.
11:17The program was set up to pay the health care costs of the poor.
11:20What brings you to the hospital today?
11:23I've been sick for over two weeks.
11:25I've had diarrhea and nausea, throwing up, and it just seems to be getting worse.
11:30But Tampa General gets so little from Medicaid for treating outpatients
11:33that it has started to turn them away if they are not judged urgent.
11:37I passed out about a week ago.
11:41What do you mean you passed out?
11:42Do you know how long you were out for?
11:44No, I don't.
11:45It's the nurse's decision.
11:47You think?
11:49I'd say urgent, especially if it's a temp and a pulse.
11:51Let's put a simmer.
11:52A few days ago, Beth Ford was rejected.
11:57This time, she's luckier.
11:59That was a real difficult case, I felt,
12:01to try to decide whether it was an emergency type of situation or not.
12:05Something that's been going on for two weeks is not truly an emergency.
12:09However, she is tachycardic.
12:10Her pulse is going fast, and she does have a temperature.
12:13So maybe that, in the process of the two weeks, things have gotten worse.
12:20Florida has the second strictest Medicaid program in the nation.
12:24Eligibility requirements are stringent.
12:27You must be blind, disabled, or a single parent on welfare.
12:30Sign the X, initial next to the circles.
12:34It's giving us permission to bill Medicaid
12:36and signing responsibility for anything Medicaid does not pay.
12:41And if Beth Ford should need admission,
12:44Florida's Medicaid program will pay only about half of what Tampa General will charge to treat her.
12:49The diagnosis is a viral infection.
12:53She'll get a prescription and be sent home.
12:56But she's been seen by a doctor,
12:58unlike most of the people without money who today turn up at Tampa General's emergency room.
13:04Those people don't have anywhere to get any kind of care.
13:07Granted, the emergency department is not the place to see a patient with a cold
13:10or a patient who's unsure why he has this little lump
13:14because he maybe got an insect bite or maybe he stepped on something.
13:17But what happens when that deteriorates?
13:18Or worse yet, what happens when someone is sent out that has a severe complication actually dies
13:25because we didn't foresee that complication coming?
13:28You know, there are nurses' licenses on their line.
13:31There's patient care on the line.
13:32There's a hospital reputation on the line.
13:34It's a bad policy, I think.
13:36It not only makes me feel bad, it makes everybody in this operation feel bad.
13:41We sat down this morning and looked at statistics,
13:43and we had gone in our Hillsborough County clinics
13:45from 690 Medicaid patient visits in the same month of August last year to 90 this year.
13:54You've got a charge of operating a business,
13:57but the people in the hospital business are involved in caring for people.
14:03Caring for people means that Joe Lowe is being admitted to Tampa General.
14:08It wasn't an emergency, but he looked so sick,
14:11an admitting clerk bent the rules.
14:12What kind of work did you do?
14:14I was a custodian.
14:16So would you say it's been at least a year since your last work?
14:20It's been longer than that.
14:22About four years.
14:23Mr. Lowe's diagnosis?
14:25Probable lung cancer.
14:26He's not eligible for Medicaid because his wife works.
14:30I've been ill.
14:31Okay.
14:32And you've been at the Florida Hotel four years?
14:35Four years, right?
14:35Four years, the 17th of March.
14:37Right.
14:38This is why I go out here two weeks.
14:40The final option for financial help is county welfare.
14:44Mrs. Lowe's take-home pay is a little over $400 a month.
14:53I know it doesn't seem like you earn that much
14:56after you pay rent and your expenses,
14:59but you're $221 over welfare level.
15:02Anything over $2,600 we can try and get help for,
15:11but we'll have to make arrangements for the $2,600.
15:14So at that time, what I do is I set them up on monthly payment arrangements.
15:18Mr. Lowe had no income.
15:21Mrs. Lowe, I believe, had made a little over $400.
15:24Their rent was $150 a month,
15:26and I said, Mr. Lowe, could you afford $15 a month?
15:29And he said, well, I believe so.
15:31So I said, why don't we just do that?
15:33But then again, at $15 a month at his age,
15:36it would be quite a while to pay those thousands of dollars of bills off.
15:39So I don't think the total bill will be paid.
15:43Matter of fact, I think I was kind of lucky on getting in, you know.
15:48No money, no insurance or nothing.
15:54Unemployed.
15:54So, you know how that go.
15:59So I feel kind of lucky, too.
16:02There are some 25 million Americans like Joe Lowe,
16:06people with family incomes too low to afford private insurance,
16:10yet too high to qualify for government assistance.
16:13And in most of these cases,
16:15it's the local general hospital that bears the financial burden.
16:20Now somebody.
16:21And all of us have prided ourselves on the fact
16:26that we have been able to carry this load,
16:28and we have done so for many years
16:32of never being given adequate funding for the care of the indigent.
16:36And through the payment of the private patients,
16:39we have carried this load.
16:44Bill Winfield is one of those private patients
16:47that's enabled Tampa General to carry its load of unfunded patients.
16:50Victim of a recent heart attack,
16:54Mr. Winfield needs bypass surgery.
16:57Tampa General has the only open heart unit in town,
17:00and bypass surgery is very expensive.
17:04No, I'm not worried about this cost,
17:06because it has to be done.
17:07There's no alternative.
17:10You have to take it,
17:11and that's all there is to it.
17:13And if the costs are there, they're there.
17:14I'm not a wealthy man,
17:16but I have real good insurance.
17:19And so I assume that most of it will be covered by that.
17:23Hopefully.
17:27In the next few hours,
17:28Mr. Winfield's insurance company will run up a major bill,
17:32and Tampa General will make a handsome profit.
17:35Every minute Mr. Winfield is on the operating table,
17:41the hospital charges $9,
17:43and that's just for the room,
17:45the nursing staff,
17:46and the reusable supplies,
17:47like the surgical instruments.
17:52170,000 bypass operations
17:55are performed each year in the United States
17:57at a total cost of $3 billion.
18:00Tampa General alone does 40 bypass operations a week,
18:04keeping two specialized surgical suites busy,
18:07dawn to dusk.
18:09Mr. Winfield's heart is about to get its first rest
18:12in almost 60 years.
18:15Its task is taken over by a heart-lung machine,
18:18which oxygenates the blood and pumps it around the body.
18:26This machine alone will cost Mr. Winfield's insurance company
18:30$1,500 before the operation is over.
18:34A vein which came from his leg
18:37is trimmed to the length needed to bypass his blocked arteries,
18:40and the heart is stopped with ice water.
18:45We are witnessing an operation
18:47that epitomizes the soaring costs of health care.
18:50It's new, involves highly skilled personnel
18:53and sophisticated equipment.
18:57Most insurers don't balk at the cost,
18:59and most patients are too sick and vulnerable
19:01and frightened to care.
19:03And for the surgeons and hospitals,
19:05it is highly profitable.
19:06A jolt of electricity starts the heart beating again.
19:22The operation over.
19:23A good part of the heart-lung machine
19:25is simply thrown away rather than sterilized.
19:28Total OR charges so far,
19:31almost $4,000.
19:33Well, the OR costs stop as he rolls out of here,
19:36but then as he goes into cardiac surgery unit,
19:39which is the intensive care unit
19:40where they are cared for post-officacy,
19:42the charges start all over again.
19:46Open heart surgery is a major source of revenue
19:48for Tampa General.
19:50Cardiac surgeon, Dr. Dennis Pupelo.
19:52I think during the fiscal year 1981-82,
19:55total revenues derived from cardiac surgery
19:58and cardiology in the catheterization laboratory
20:00were about $23 million for this institution.
20:04That represents one-fourth of Tampa General's revenues.
20:08And for every dollar it charges on heart surgery,
20:11the hospital makes about 40 cents in profit.
20:16The physician's fees are separate.
20:18Dr. Pupelo's group will be billing
20:21the insurance company $4,675.
20:3024 hours later.
20:32Keep your eyes open for a minute.
20:34Put a thumbs-up sign if you want.
20:38Mr. Winfield is one of the 110 million Americans
20:41whose hospital bills are paid for by private insurance
20:44and who provide the nation's hospitals
20:47with a profit almost every time they are hospitalized.
20:50We're doing fine, Bill.
20:52Okay?
20:52Tomorrow breakfast at 8.
20:55But if Mr. Winfield is the ideal patient at Tampa General,
20:58the hospital is also delighted to welcome many patients
21:01with no private insurance at all.
21:03The reason?
21:04The reason?
21:06Like Cora Davis, who two weeks ago turned 65,
21:10they are eligible for Medicare.
21:16Medicare, a federal program,
21:18spends some $50 billion a year
21:21towards the hospital bills
21:22of the 30 million elderly Americans like Mrs. Davis.
21:25Are you going to make it by check or how?
21:27No money, I don't.
21:29You've got cash?
21:30Right.
21:31Okay, if you want to give me the cash,
21:32I'll take it to the cashiers
21:33and get you a receipt.
21:35And you wait here and I'll bring the receipt back.
21:37You say $3,4?
21:39$304.
21:40Right.
21:41Medicare requires only a down payment
21:43on the hospital bill.
21:45For Mrs. Davis,
21:47Medicare is a lifesaver.
21:49She suffered for years
21:50from a condition that threatens her
21:52with a stroke at any moment.
21:54She couldn't afford an operation,
21:55so continued working as a housekeeper,
21:57waiting for her 65th birthday
21:59and eligibility for Medicare.
22:02I was just living off of fear and hope
22:05and prayer
22:07that I could go through with it,
22:10you know, before I did have a stroke.
22:14In her neck,
22:16an artery is partially blocked.
22:18She is x-rayed with a device
22:19that reveals the blood vessels.
22:22Hospital charges?
22:23Almost $1,000.
22:25Mrs. Davis is just glad
22:27the technology exists.
22:28I think that's why
22:29they lose so many patients.
22:32They don't have the right stuff to work with.
22:36So I think it's beautiful.
22:40The x-ray confirms the problem.
22:42Mrs. Davis will need surgery
22:44to clear the blockage.
22:47The hospital will be reimbursed by Medicare
22:49for its treatment of Mrs. Davis
22:51according to a complex formula
22:53that will,
22:54if the hospital is skilled
22:55at interpreting the rules,
22:57allow it to recover
22:58most of its costs.
23:03Mrs. Davis is hooked
23:04to a brainwave monitor.
23:06The blood supply to her brain
23:07will be restricted
23:08as her artery
23:09is temporarily tied off.
23:11Quick action
23:12will be needed
23:13if her brainwaves
23:13start to falter.
23:15How are you doing?
23:16She's okay, sir.
23:17But they hold steady
23:19and the surgeons
23:20can now delicately
23:21scrape out
23:22and remove
23:23the fatty plaque
23:24that's been blocking
23:25her artery
23:25and threatening her life.
23:27Here, you've got to go on.
23:28If Mrs. Davis
23:35were privately insured,
23:36the hospital
23:37would earn
23:38$6,000
23:39from her operation.
23:41From Medicare,
23:43it will actually
23:44get about 60% of that,
23:46say,
23:46$3,600.
23:50So, while not delivering
23:52the profits
23:52of privately insured patients,
23:54Medicare does provide
23:56a steady stream
23:56of revenue
23:57to a hospital.
23:58If Tampa General
23:59were to treat
24:00only Medicare patients
24:01like Cora Davis
24:02on whom it breaks even
24:03and privately insured patients
24:05like Bill Winfield
24:06on whom it makes a profit,
24:09just imagine
24:09the money it could make.
24:11Make a pill run first.
24:13At pill run,
24:14we have the best designs
24:16for you,
24:17the best ideas
24:18in mind for you.
24:20The annual convention
24:21of the American
24:22Hospital Association.
24:24You've got the best...
24:25An annual reminder
24:26of the multi-billion dollar
24:28business the hospital
24:29industry has become
24:30and an annual showcase
24:32for a group of companies
24:34that in the mid-1960s
24:35did spot the profit potential
24:38of the right sort of hospital.
24:41Hello!
24:42Welcome to Middle City,
24:43North Central,
24:44South Suburban Hospital.
24:45I'm Nurses Abe...
24:47A group of companies
24:47that now constitutes
24:49an industry growing faster
24:50than the computer business
24:51and last year
24:52made pre-tax profits
24:54in excess of
24:55one billion dollars.
24:56The state of the art
24:57in technology!
25:00Wow!
25:01Hospital Corporation of America
25:03owns or operates
25:04384 hospitals,
25:06annual revenues
25:063.5 billion dollars.
25:09National Medical Enterprises,
25:1060 hospitals,
25:12one billion dollars.
25:14LifeMark,
25:1527 hospitals,
25:16900 million dollars
25:17in revenues.
25:18Recently acquired
25:19by American Medical International,
25:2172 hospitals,
25:221.6 billion dollars
25:24in revenues.
25:26And Humana,
25:27the most profitable
25:28of all,
25:292.3 billion dollars
25:31in revenues
25:31from 89 hospitals.
25:33And this
25:34is the 90th.
25:35...concept
25:36to one of the country's
25:37most prominent
25:38and most progressive
25:40health care organization.
25:42The opening
25:42in August 1983
25:44of the newest hospital
25:45in the Humana chain,
25:47Humana Women's Hospital,
25:48Indianapolis.
25:49and a welcoming speech
25:51from Indiana's
25:52Lieutenant Governor.
25:53On behalf of the
25:545.5 million people
25:55who live in this state,
25:56I say,
25:57welcome,
25:58Humana.
25:58We're delighted
25:59to have you here.
25:59The chairman
26:18and co-founder
26:19of Humana,
26:19David Jones,
26:20and his basic philosophy.
26:21Women's Hospital
26:23is all hospitals.
26:23It's the same thing,
26:24understanding what
26:25our customers need,
26:26making sure we provide it.
26:28Unexceled quality
26:29that's measurable.
26:30This is a beautiful hospital
26:31and it's a good place
26:32where women will get
26:33high-quality care
26:34and where the price
26:36will be right.
26:36Jones started in the nursing
26:44home business
26:45in the early 60s,
26:46switched to hospitals
26:47soon after Medicare
26:48was enacted,
26:49went public with his company
26:50in 1968,
26:52and last year
26:53saw Humana
26:53gross $2.3 billion.
26:56His latest strategy
27:00is to build hospitals
27:01catering exclusively
27:02to women.
27:04But his basic approach
27:06was already established
27:0712 years ago
27:08when Humana built
27:10its first hospital
27:11here in Jones' hometown
27:12of Louisville, Kentucky.
27:15All Humana hospitals,
27:17whether acquired
27:18or custom-built,
27:19have the same look
27:20and style.
27:21Our approach
27:22is one of caring
27:23and concern
27:24for our patients.
27:25We call it Humana care.
27:27It's a heightened
27:28sensitivity and awareness
27:29of the patient's needs
27:31and expectations.
27:32We believe that
27:34if a patient
27:34has a happy experience
27:35here,
27:36they'll tell
27:36three of their friends.
27:38However,
27:38if they have
27:39a bad experience,
27:40they will tell
27:4111 of their friends.
27:43The key question
27:44always is
27:45who is the customer
27:46and what are the
27:48needs and values
27:49of the customer?
27:51And I think
27:51our recognition
27:53that there were
27:54people out there
27:55who received services
27:56who have the same
27:58kind of interest
27:58in the quality
27:59of those services
28:00that one might have
28:01in the purchase
28:01of an automobile
28:02or in staying
28:03at a hotel
28:04or something
28:04of that sort.
28:05And if you'll read
28:07to me what you would like,
28:08I'll mark your selections
28:09here on your menu.
28:11I'll take some
28:11shrimp cocktail.
28:13The emphasis
28:13at all Humana hospitals
28:14is on patient
28:15or customer satisfaction.
28:18This lobster tail
28:19for you looks good.
28:20All righty.
28:22And I'll take
28:23this cherry cobbler.
28:25All right.
28:25And I will take
28:26a dinner roll.
28:27Okay.
28:28Sounds good.
28:31Food.
28:31We need a very tender
28:33steak sandwich
28:33on a bun, please.
28:35And the customer's
28:36personal preference
28:37receive a high priority
28:38at Humana hospitals.
28:40But the most important
28:41customer of all
28:42is the physician.
28:43I'm going over to the hospital
28:44to see that post-op diabetic.
28:46I'll be back
28:46in a couple minutes.
28:47Okay.
28:48It's the physician
28:49more than anyone
28:50who decides
28:51which hospital
28:52his patients will go to.
28:54By building
28:55physician's offices
28:55next to most
28:56of its hospitals
28:57and renting them
28:58at bargain rates,
29:00Humana ensures
29:01a steady stream
29:02of patients
29:03from doctors
29:03who can simply
29:04pop next door
29:05to see them.
29:05Yeah.
29:06Well, that's great.
29:08This is the heart
29:10of Humana's operation,
29:11a computer installation
29:13in Louisville
29:13that is in daily
29:14communication
29:15with the 90 hospitals
29:16in the chain.
29:18From drug inventories
29:19to the ratio
29:20of nurses to patients,
29:21data on every aspect
29:23of every hospital's
29:24operation
29:24are sent here
29:26every night.
29:27And every morning,
29:28each hospital administrator
29:29has a printout
29:30on his desk
29:31with orders for the day.
29:33This centralization
29:34is one key
29:35to Humana's ability
29:37to control its costs.
29:39David Jones.
29:40In the 40 standard
29:41metropolitan statistical areas
29:42where Humana operates,
29:44we have a cost advantage
29:45of 16.8% per admission
29:47compared to our competitors
29:49in those markets.
29:50Here in Louisville,
29:51we have a 33% cost advantage.
29:54Humana may have
29:55a significant cost advantage,
29:57but this is not reflected
29:58in its charges.
30:01Here in one of its
30:02Louisville hospitals,
30:03an upper chest operation
30:05is underway.
30:06Off in one corner,
30:08a vigilant team of nurses
30:09is keeping track
30:10of every item,
30:11from swabs to sutures.
30:13It is all recorded
30:14for the patient's bill.
30:16The goalie catheter
30:18was a 16.5 cc.
30:20Studies in California,
30:22Texas, and Florida
30:23suggest the for-profit hospitals
30:25mark up such items
30:26as drugs and x-rays
30:27more than the non-profits.
30:30Transfer units,
30:31100 cc.
30:32They rarely charge
30:33less than the non-profits
30:35for a typical hospital stay,
30:37yet claim a greater efficiency.
30:39One explanation comes
30:41from for-profit industry
30:42spokesman Michael Bromberg.
30:43I believe that our charges
30:45are competitive.
30:47I believe that we are efficient
30:48and that the two
30:49are not necessarily equatable.
30:51You can have a brand new hospital
30:53built on the corner,
30:54which obviously can't be cheaper
30:55than the 30-year-old hospital
30:57down the street
30:57with no mortgage.
30:59That doesn't mean
31:00that the first one
31:00isn't much more efficient
31:01than the second one.
31:02Well, that, of course,
31:03is the claim that they make.
31:05Dr. Arnold Relman
31:06is a prominent critic
31:07of for-profit hospitals.
31:10Efficiency to most people,
31:11it seems to me,
31:12would imply
31:13that they should be able
31:15to deliver
31:16good health care
31:18less expensively.
31:20And they don't.
31:22They actually charge
31:24a lot more
31:25than comparable
31:26not-for-profit hospitals,
31:29and they collect
31:30considerably more.
31:32All the studies
31:32that have been done so far
31:34seem to come
31:35to that conclusion.
31:36It's more expensive,
31:38not less expensive,
31:39to be taken care of
31:41in a for-profit hospital
31:43in this country.
31:44But to the mainly
31:46middle-class,
31:47well-insured,
31:47prospective customers
31:48of Humana Women's
31:49Indianapolis,
31:51the cost of their hospital
31:52care is of little concern.
31:54I've heard about
31:55Humana in other parts
31:56of the country,
31:57but I don't know
31:57what their pricing policy is.
31:59I know they go
32:00for-profit business,
32:02and, you know,
32:03if it's like banking
32:03or whatever,
32:04you want to hit
32:04the upstream client,
32:05and the money
32:06doesn't seem to make
32:06any difference there,
32:07so, you know,
32:09they may charge more.
32:10But I can't see it
32:11being that big
32:11a determinant.
32:13You know,
32:13it's not going to
32:13make any difference to us.
32:15Because we have
32:15insurance, you know,
32:16so...
32:17Have you considered that?
32:18I haven't considered
32:18that either.
32:21If Humana hospitals
32:22are more efficient
32:23at making money
32:24than most of their
32:24competitors,
32:25they are also
32:26more efficient
32:27at collecting it.
32:29All billing
32:29is done centrally
32:30from Louisville,
32:32where there is also
32:32an effective operation
32:33to ensure
32:34that the bills are paid.
32:35I'll give you a copy
32:36of the card
32:36for this month,
32:37and then I'll see
32:38if we can't get it billed.
32:40$452.92,
32:42and it does need
32:42to be paid in full.
32:44Would you have
32:44a feature, please?
32:46Okay, ma'am.
32:47This is who's king.
32:48You only find
32:49a time on the balance.
32:50We're trying to exhaust
32:51every person who needs
32:52up here.
32:52Humana Hospital
32:53in Farland,
32:54and I was calling
32:55about an account
32:56that had a balance
32:57of $45.00...
32:58Humana is the most
32:59profitable of the
33:00for-profit hospital chains,
33:02in part through
33:03a shrewd policy
33:04of targeting
33:04the most profitable
33:05patients.
33:07Nowhere has the policy
33:08been more successful
33:09than in Tampa, Florida,
33:12where Humana Women's
33:13is the most profitable
33:14hospital in the chain.
33:17Whoops!
33:21Congratulations
33:21on your baby.
33:22Thank you very much.
33:26Deborah and Kevin Keelan
33:27are celebrating
33:28the birth of their
33:29daughter Kelly
33:29with the traditional
33:30Humana postpartum
33:32gourmet dinner
33:32of stuffed shrimp
33:33and filet mignon.
33:34Thank you very much.
33:36Here we go, sweetheart.
33:37To Kelly.
33:39They chose Humana
33:41for the same reasons
33:42most people do.
33:43How did I come
33:43to choose this hospital?
33:45Well, I have,
33:46to be honest with you,
33:47I have friends
33:47that have had babies
33:48that have raved
33:49about women's hospital.
33:51And so, naturally,
33:52when you get in
33:53the condition yourself,
33:54you start thinking
33:55about what to do.
33:56One thing is location.
33:58It's got a lot
33:59to do with it
33:59because we live
34:00on the north side
34:01of town
34:01and this hospital
34:02is very convenient
34:03for the two of us
34:04to get to.
34:06Like most Humana
34:07hospitals,
34:08Tampa Women's
34:09is in a growing
34:09affluent neighborhood.
34:11Money is of no consequence
34:14whatsoever
34:15when you're dealing
34:16with life.
34:19I've never been
34:19obsessed with money.
34:24But what we've got now,
34:27money couldn't buy that.
34:29It really couldn't.
34:30And if it meant mortgaging,
34:32my house,
34:33my pool,
34:34whatever,
34:35my cars,
34:35whatever,
34:36I would do it.
34:37So money is,
34:40it really isn't
34:40of importance to me.
34:42For people to whom
34:43money is a problem,
34:45Tampa Women's
34:45is not an option.
34:47For them,
34:48there's only one hospital
34:49in town they can go to
34:50and that's
34:51Tampa General.
34:55Christine McKinney
34:56has no private insurance.
34:58Now at Tampa General,
34:59she first went
35:00to Tampa Women's.
35:02They just told us,
35:04they said,
35:04you either give me
35:05a thousand,
35:06twenty-five dollars cash
35:07or we just transport you
35:09over to
35:09Tampa General.
35:12And my husband said,
35:13well,
35:14do you carry that kind
35:15of money in your pocket?
35:16Could you hand me that?
35:17She says,
35:18no.
35:18He said,
35:18well,
35:18I can't either.
35:20And so we just
35:21come over here.
35:22We didn't have any problems
35:23at all with
35:23people here.
35:26They didn't treat you
35:27like, you know,
35:28just because you didn't
35:28have that kind of cash
35:29and you were dirt.
35:31I've never experienced
35:32before where a private
35:35hospital in town
35:35would be so exclusively
35:37private to cause
35:39the hospital in town
35:40that does accept
35:41indigent patients
35:42by nature of its charter
35:44reach the dilemma
35:46that we've reached
35:47right now.
35:48Dr. J.K.
35:49Williams is head
35:50of the high-risk
35:51pregnancy unit
35:52at Tampa General.
35:53Historically,
35:55Tampa General Hospital
35:56has been expected
35:57to survive
35:58by attracting
35:59enough private patients
36:00so that the bills
36:02of the private patients
36:03would pay
36:04the bills
36:05of the indigent patients.
36:07Now,
36:07with the growth
36:08of Tampa
36:09in the last few years
36:10and with no other
36:13hospital in town
36:14willing to accept
36:15a single indigent
36:16obstetric patient,
36:18by nature,
36:18they all have to come here
36:19and they totally
36:21fill our beds.
36:22So if you speak purely
36:23from an obstetric standpoint,
36:25this hospital is losing
36:27considerable amounts
36:29of money
36:29by accepting
36:30patients who
36:31cannot pay
36:33for themselves
36:33or have insurance.
36:36This is the core
36:37of the crisis
36:38at Tampa General.
36:39Ninety percent
36:40of the women
36:40who come here
36:41have no private insurance
36:43and 50 percent,
36:45over 2,000 women
36:46a year,
36:47neither have insurance
36:48nor qualify
36:49for any financial aid.
36:51In every one
36:52of these cases,
36:53including Mrs. McKinney's,
36:54Tampa General
36:55risks not getting
36:57paid at all.
36:59Her baby is likely
37:01to be very expensive.
37:02It will be born
37:03by cesarean section.
37:05Two previous pregnancies
37:07ran into trouble
37:07and the baby
37:08is being delivered
37:09six or seven weeks
37:10before term.
37:11Very nice size.
37:13All right.
37:13Good girl.
37:14That's what you wanted.
37:15Yay.
37:16What time is going to do?
37:18Do you want to go to that one?
37:20Yep.
37:21Go to that one.
37:22Got it?
37:26Got it.
37:27It's a baby.
37:27Yep.
37:28Good baby.
37:29the baby will need a period in the newborn intensive care unit
37:38these units are among the most costly areas of a hospital
37:42a lot of staff and technology are needed to give premature babies a good start on life
37:49even though she'll be here for only three days
37:56the baby's bill alone will come to three thousand dollars
37:59across town in humana women's intensive care unit Kevin and Debbie Keelan are
38:08visiting their new daughter also delivered by cesarean Kelly's first few
38:15days of life have been difficult and expensive the Keelan's total bill will be
38:20at least thirteen thousand dollars we have insurance very good insurance but
38:26if it meant that we had to fork out of our own pockets we certainly would have done that
38:35christine mckinney's bill will total eighty four hundred dollars
38:39well my husband's been working sixty to seventy hours a week he's going to keep doing it
38:44that's the way we'll pay so much a month monthly payments like paying rent
38:50despite good intentions many unfunded patients never pay off their total bills and in accepting
38:58these patients while losing the paying customers to the for-profit competition Tampa General is by no
39:05means unique my guess is that there are scores perhaps even a few hundred hospitals around the country like
39:13Tampa General that are struggling to stay alive as they try to meet the competition from hospitals that are skimming
39:22all the private paying patients away Tampa General has been losing the competition for years and for the
39:31same reason as the other large old hospitals around the country our biggest drawback right now is the physical plant we have a labor and delivery unit that was designed a number of years ago for approximately eight hundred deliveries a year well we're doing forty
39:31five hundred deliveries patients are on top of one another private patients aren't going to accept that and they don't humana women's is now the hospital of choice for most insured women in Tampa including many on the staff at Tampa General
39:47other private hospitals in Tampa have also been drawing the insured patients away from Tampa General some of these hospitals belong to for-profit chains like American Medical International Memorial Hospital
40:07but Tampa General has now committed itself to fighting back two years ago it borrowed one hundred sixty million dollars in the bond market and began a major reconstruction and expansion program
40:27it's aiming not only to upgrade its existing facilities but to build what it hopes will be major new sources of revenue such as
40:37as a five million dollar rehabilitation unit
40:44six weeks ago Richard Reeves was in a car crash that paralyzed him from the waist down
40:49he's a Tampa General's existing rehabilitation unit which is small and overcrowded
40:55accident victims like Richard Reeves are a good source of revenue to a hospital
41:06workers compensation covers many who aren't privately insured
41:11Richard's bill will be over thirty thousand dollars before he leaves and the hospital can expect to collect on it all
41:18the new rehab center should help many more like Richard Reeves and the hospitals cash flow
41:25but Tampa General isn't alone in spotting the value of rehab programs
41:30a proprietary for-profit chain now has plans to build a competing rehab center in Tampa
41:37we're concerned because we know from our experience elsewhere with respect for example the obstetrics service that the proprietaries will not accept some of the unfunded patients and therefore and they will take more of the private paying patient and we will be left with a poor mix of patients in terms of their financial ability to pay for the service
41:59our investment bankers say we have to to meet these these challenges that we can't sit back and allow our share of the market to be taken away that we have to fight for it like any other business would
42:11and now Tampa General has a new fight on its hands
42:18Bill Winfield three days after his bypass operation takes his first walk
42:23his hospital bill now approaching twelve thousand dollars
42:26well here I go
42:28this is the Tampa Marathon
42:31a major reason Tampa General was able to sell its one hundred sixty million dollars worth of bonds
42:37was its monopoly on the lucrative open heart business in the Tampa area
42:41best exercise a man can get
42:44but now that monopoly is crumbling
42:47the surgical team that operated on Mr. Winfield
42:51and half of Tampa General's other open heart patients
42:55is planning to move most of its business to another hospital
42:58what did it take to persuade them?
43:01well it took a great deal
43:03of course we were given the things that we needed
43:07and that's what precipitated the move
43:11the hospital that lured them away is St. Joseph's
43:15a private hospital that's highly successful in competing for insured patients
43:20until Humana Women's opened across the street and captured most of its baby business
43:25St. Joe's response?
43:27get out of babies and into hearts
43:30remodeling its obstetrics unit into an open heart suite
43:33and giving Dr. Pupelo everything he needs to run it
43:37and that's not the only threat to Tampa General's heart business
43:41there are also plans for a for-profit heart institute in town
43:46it's accepted that you can't have the only show in town
43:49now hopefully there won't be one on every corner
43:52and that's what we're really concerned about
43:54three or four more of these activities
43:57in every neighborhood will put this hospital in serious financial situation
44:03even as Tampa General fights to keep its remaining lucrative patients
44:08it faces a new challenge at the bread and butter end of its business
44:12Medicare
44:14Cora Davis is having an expensive CT scan of her head
44:18her earlier tests showed up an unsuspected problem
44:21a possible tumor beneath her brain
44:24she is one of the last Medicare patients whose hospitalization will be paid for
44:29according to how much the hospital spends on tests like this
44:33from now on hospitals will be given a flat fee depending on what illness a patient has
44:40the goal is to hold down Medicare costs
44:44mrs. Davis does have a tumor
44:48she'll need to come back to Tampa General in a few weeks to have it removed
44:52meanwhile her artery surgery has finally lifted from her the fear of suffering a stroke
44:59I think it worth it
45:03cause
45:04it's like the doctor said
45:06if I hadn't went through with it
45:08I would have suffered a stroke
45:09and I would have been blipped out
45:11so
45:12and the way I'm feeling this morning
45:15I thank God for it
45:16you know that they had such a thing as that
45:18the new Medicare payment scheme is causing hospitals a lot of anxiety
45:24Bill Winfield's insurers will be paying his bill
45:27but the question of how much Medicare will pay for open heart surgery like his
45:31is a vital concern to Tampa General
45:34and today as Bill Winfield's being discharged
45:37the new Medicare price list has just arrived
45:40that's tremendous
45:42yeah that's right
45:43we do well with that
45:44oh yeah
45:45we cut that in about half
45:47twenty days
45:48coronary bypass without cardiac caths thirteen point five days
45:52we'll make out like bandits
45:54that's right
45:55I can tell you one thing we better do
45:57the investor owns will know which of those DRGs are unfavorable
46:03and they'll be out of those programs before we realize
46:07what the impact will be and we'll be stuck here with the same losing programs
46:12that public hospitals always have
46:14what this will do is to give us information on those that appear profitable
46:17we can concentrate our marketing efforts
46:19we can concentrate our facility development
46:22our capital acquisition efforts on those diagnosis
46:25where we really want
46:26where we think we can really make some good money
46:28you know what that'll mean then
46:29that'll just mean that Tampa
46:31discussions like this are now taking place across the country
46:34in a political climate where cutting hospital costs is a national priority
46:39competition for the profitable patient is intensifying
46:45meanwhile the twenty-five million Americans like Joe Lowe
46:48with no funding of any kind are increasingly unwelcome
46:52the for-profit hospitals make their money by avoiding cases like his
46:56and he's now here at Tampa General only because a clerk bent the rules
47:01the tests he'll get will rule out cancer
47:04but he has a serious lung disease
47:07no hospital will ever make money treating it
47:10as healthcare is increasingly seen as a business
47:14like any other business
47:17the sense that we have an obligation
47:21a social obligation
47:23to pay for the care of those who can't afford to pay
47:27tends to disappear
47:29and wherever for-profit
47:31healthcare comes into the picture
47:34philanthropy
47:35and community responsibility
47:37begins to wane
47:39an early victim of the New Times is Dora Mosley
47:44five months after being turned out by Tampa General
47:48her heart is still unrepaired
47:51now is the best time because my heart
47:54all of my heart is good
47:56but the two valves
47:57the muscles is all good
47:59and it would take now
48:01if I wait there's no change
48:03there's no use going in
48:04Dora Mosley's heart can still be saved
48:07but time is running out
48:09time is running out
48:13time is running out too for Tampa General
48:16before it can once again help Mrs. Mosley
48:19and the others it's turning away
48:21it must first save itself
48:23but has it left until too late
48:25its attempts to attract back
48:27the paying patients it needs
48:32this hospital did leave it too late
48:35a large urban teaching hospital
48:37it too faced Tampa General's problems
48:40its paying patients went to new for-profit hospitals in the suburbs
48:45and it was left with only the indigent patients
48:48to pay for their care
48:50it needed more and more tax dollars
48:53so it began an ambitious reconstruction program
48:56to bring back the paying patients
48:59but by the time the new building was completed
49:02it couldn't afford to open it
49:04the hospital is the University of Louisville Hospital
49:08in Louisville Kentucky
49:10hometown of Humana
49:15so with a brand new building
49:17and no one to run it
49:18the University of Louisville Hospital
49:20became Humana Hospital University
49:23David Jones brokered the deal personally
49:29Humana is leasing the hospital
49:34and in return for guaranteed tax support
49:36will take care of the city's indigence
49:38we're real well
49:39real well pleased with the facility
49:41it's an unprecedented move for Humana
49:43contrary to its usual policy
49:45of buying or building smaller suburban hospitals
49:48for Jones
49:50for Jones
49:51this is a showcase
49:52and a gamble that the for-profit approach
49:55will work in a community hospital
49:57it's an innovative concept
49:59that needs a chance to prove itself
50:01if it does prove itself
50:02perhaps we can do that in Tampa
50:03or other places where the community hospitals
50:05are having difficulties
50:07I don't promise that we can
50:09that we can change the world
50:10but we're the first to make this attempt
50:13this is the only community in America
50:16whose indigent care problem
50:17that I know of
50:18is actually tied down tightly
50:20for a four year period
50:22and that comes because we're profitable
50:24because we've covered that cost
50:26it also comes because
50:28taxpayers have guaranteed
50:2920 million dollars a year
50:31to help cover the cost
50:33it's a gamble Louisville hopes
50:35Jones will win as much as he does
50:37and it's an experiment with
50:39dramatic implications
50:40which could mark the beginning
50:42of a major new direction
50:44for the for-profit hospital chains
50:46in Massachusetts for example
50:48prestigious McLean Hospital
50:50affiliated with Massachusetts General
50:52was almost sold to the Hospital Corporation of America
50:55until the medical faculty vetoed the deal
50:58their concern?
50:59that the traditions of a teaching hospital
51:01weren't compatible with for-profit ownership
51:04George Washington University Hospital
51:06has also talked with several for-profit hospital companies
51:09with 10% of the hospital industry
51:12already under their control
51:14it's an irony that the for-profit chains
51:16with their power to raise money in the stock market
51:19are among the few institutions
51:21with the financial muscle needed
51:22to save the nation's threatened public hospitals
51:25the simple fact is the public sector
51:27in this country can't do it alone
51:29and there's no choice
51:30we're the only hope of financing
51:32quality health care in the future
51:34and we're going to be here
51:35and we're going to do it
51:36it's everybody's problem to look at
51:39whether this is or is not
51:41the appropriate way
51:43to treat people
51:44and indeed whether profits
51:47out of illness
51:49are really appropriate
51:52frankly I can't help but think that's
51:54somehow just doesn't make sense to me
51:57I don't own any stock in any of them
51:59I think most of the health field
52:01has traditionally been for-profit
52:03except for the hospital field
52:04which has been 90% non-profit
52:06for many many years
52:08and that's the one that's accused
52:10of the most inefficiency
52:11so I think the burden
52:13is not on me to defend it
52:14so much as it is on others
52:15to say what's wrong with profit
52:16it's what made this country great
52:18so I think profit is American
52:20and I shouldn't have to defend it
52:22is that the ultimate answer?
52:23the financial success?
52:25I think the health care system
52:26in this country
52:27is I think different
52:28from the automobile industry
52:31it has to be
52:33I mean we're dealing with human beings
52:34we're dealing with
52:35with people's lives
52:37Mr. King what happened to you tonight?
52:39oh I was walking down
52:42at Tampa General
52:45the daily battle for survival continues
52:48even as it cuts back on services
52:51and turns away non-urgent cases
52:53it continues too
52:55as the hospital of last resort
52:58for those in an emergency
53:00even those like Mr. King
53:02who've been turned out
53:03by other hospitals
53:04he told you to come to Tampa General?
53:06to get turned out
53:08Mr. King is a classic example
53:10of a patient who winds up
53:11in our emergency room
53:12triaged from another emergency room
53:14basically because
53:16he has no really way of paying for his care
53:20and I think it's understood
53:22and I think it's understood
53:23that eventually
53:24if they wind up at Tampa General
53:25they'll get taken care of
53:26that's the way it's always been
53:29but with hospitals
53:30like Tampa General
53:31already shutting its doors
53:32to the poor
53:33because of the bottom line
53:35what sort of health care
53:37will millions of Americans get
53:39in the future?
53:40get the stitches out
53:41uh...
53:42who do you see that?
53:43any special ones?
53:44county clinic
53:45just walk in
53:46Tampa General
53:59lost twelve million dollars
54:00in 1983
54:01and the crisis there
54:03is getting worse
54:04Dr. Papello
54:05the heart surgeon
54:06moved his practice
54:07that will cost
54:08Tampa General
54:09another three hundred thousand dollars
54:11a week
54:12press reports
54:13have suggested
54:14the hospital is mismanaged
54:15and a new top administrator
54:17has been hired
54:19whatever the cause
54:20of these problems
54:21the situation
54:22does illustrate
54:23the economic pressures
54:24on all public hospitals
54:26a presidential commission
54:27has said
54:28society has an obligation
54:30to ensure equal access
54:31to health care
54:33but the commission also said
54:34that each individual
54:36must pay a fair share
54:38the questions facing all of us
54:40should every American
54:41have the right
54:42to the best health care
54:43money can buy
54:44and who will pay
54:45for those
54:46who cannot afford
54:47to pay for themselves
54:48and on a personal note
54:51last October
54:52Jessica Savage
54:53was killed
54:54in an automobile accident
54:55she was the anchor
54:56for the first season
54:57of Frontline
54:58she was a colleague
54:59and a friend
55:00as a professional
55:01she gave us
55:02her enthusiasm
55:03energy
55:04and support
55:05as a friend
55:06we will all miss her
55:07next week on Frontline
55:13a side of modern industrial Japan
55:15we rarely see
55:17a seldom told story
55:20behind the Japanese miracle
55:22Japanese miracle
55:23a tale of America
55:28Japan
55:30automobiles
55:31and the workers
55:32who make them
55:33I believe
55:34it's going to be
55:35the best place
55:36I've ever worked
55:37a journey from Tennessee
55:39to Tokyo
55:41and a different image
55:42of Japanese labor relations
55:44we've given it the title
55:47we are driven
55:48it is next week
55:50on Frontline
55:51I'm Judy Woodrow
55:52I'm Judy Woodrow
56:22oh
56:52For a transcript of this program, please send $4 to Frontline, Box 322, Boston, Massachusetts, 02134.
57:09Frontline is produced for the Documentary Consortium by WGBH Boston, which is solely responsible for its content.
57:18Major funding for Frontline was provided by the Corporation for Public Broadcasting.
57:23Additional funding was provided by this station and other public television stations nationwide,
57:29and by the Chubb Group of Insurance Companies, for over 100 years providing worldwide business and personal insurance through independent agents and brokers.
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