Hospital requests public hearing on proposed outpatient surgery center

By Lynn R. Parks

A planned for-profit, outpatient surgery center for Seaford could mean a $1 million drop in income for Nanticoke Memorial Hospital, said new hospital CEO Mark Rappaport. This for a hospital that is already struggling  last year, it posted a $1.8 million loss and the year before that, a $1.1 million loss. But proponents of the Seaford Specialty Surgery Center say that $1 million is a drop in the bucket of Nanticoke's $116 million patient revenue. With a surgery center, they say, patients would save time and money. And, added Rob McCarville, principal of the Medical Consulting Group, Springfield, Mo., which is developing and would manage the facility, there is a need in western Sussex County for more operating rooms. On Nov. 15, the Delaware Health Resources Board approved construction of the 5,700-square-foot surgery center, planned for land near the hospital's Mears Campus at the intersection of Bridgeville Highway and Herring Run Road. The hospital is protesting that decision and has requested a public hearing on the board's approval. "A separate surgical facility would just not be good for us," said Rappaport. "It would take surgical volume out of the hospital." The hospital performs about 1,700 outpatient surgeries a year. Opposition to the center is an about-face for the hospital. Earlier in the center's planning stages, Nanticoke was part of the partnership of five doctors. But the hospital dropped out. "We recognized that it was not a good thing for us to be involved in," Nanticoke spokesman Tom Brown said. "We think that there is enough surgical capacity already and the center would be a drag on hospital funds." McCarville said that about 20 percent of the 27 surgical centers his company has developed nationwide have partnerships with hospitals. Bay Health, Dover, is a partner in the Dover Surgery Center, developed by Medical Consulting Group. "We were disappointed that Nanticoke chose not to participate," McCarville said. "Then we were even more disappointed when it turned adversarial." In its request for a public hearing on the state board's approval of the surgery center, the hospital argued that the community does not need additional operating rooms. Need is one of the criteria for state approval of such centers. But McCarville said that population studies indicate that in fact, to handle the people who live here, the area does need more operating rooms. "A lot of people are leaving Seaford and going to outside facilities for medical care, and we hope to keep some of those people here," McCarville said.

Claude DiMarco, an ear, nose and throat doctor who is president of the doctor group that is planning the surgery center, said that because of limited staff, only four of Nanticoke's six operating rooms are functioning. Patient demand would be there, he said, if the ORs were available. This summer, for example, when parents wanted to schedule children for tonsillectomies, he could not get any surgery time at Nanticoke until September. "I tell them they have to wait two months and of course, they go elsewhere," he said. Brown agreed that only four of the six ORs in Nanticoke are open. But that is not because of limited staff, he said. Rather, "we don't have the volume" to have all six operating rooms running. "We could get the staff for the operating rooms, if we needed it. We have no indications of excess surgery waiting times." Nanticoke also said in its request for a public hearing on the board's OK of the surgery center that cutting into the hospital's bottom line would make it less able to serve indigent patients. Last year, the hospital had $4.2 million in charity care, defined by tax laws as care provided to people who say up front that they will not be able to pay their bill. That was four percent of the hospital's patient revenue. In addition, Nanticoke had $11 million in bad debt, bills that people agreed to pay and then did not. "That totals $15 million in care we didn't get paid for," Brown said. "Our facility is going to serve the indigent population as well," McCarville said. The Seaford Specialty Surgery Center will be required by state law to contribute 2.75 percent of its proceeds to indigent care. "That is the minimum of what we will do," McCarville added. "Depending on the circumstances of our patients, the percentage could be more than that." In addition to DiMarco, partners in the surgery center are Ganesh Balu, a doctor with Pain Management and Rehabilitation with offices in Dover, Middletown, Seaford and Lewes, and surgeon Francisco Rodriguez, obstetrician and gynecologist James Rupp and podiatrist Bradley Lemon, all with offices in Seaford. Balu said that the surgical center would mean less cost to the patients. "The health care system in general would save millions," he said. "Patients would pay less to us and that would equal savings to insurance companies, the government, everybody." DiMarco added that the center would also mean greater efficiency, with shorter turnaround time for patients, and would enable the doctors to better manage their schedules. Surgeries could be planned for late in the afternoon, for example, when the operating rooms at Nanticoke are no longer open. Like McCarville, DiMarco was disappointed in the hospital's decision not to be a partner in the center. He counters Nanticoke's claim that the center will mean fewer patients for the hospital. "This will feed off itself," he said. "More services being offered here will mean more patients, and that will get surgeons talking about all that we are doing here, and maybe that will mean more surgeons." And he wonders about Nanticoke's claim that the surgery center will mean a financial loss for the hospital. "They talk about the big hit they will take, but they could soften that a little bit by joining in," he said. But the hospital doesn't want simply to lessen its loss to the surgery center, Brown countered. It wants to eliminate that loss completely. "The whole idea is that revenue generated by procedures is used to reinvest in the community, for new doctors, equipment and staff," he said. "We don't want to settle for losing less money. "The revenue generated in the operating room is used to support services of the hospital that the community needs, and it is our job to fight for that. We are fighting for the community, not for private interests."

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