Marc Wallace, CEO, Texas Children’s Hospital, Houston, TX


Yesterday I heard a clip of Senator Lindsay Graham, (R) of South Carolina stating that we have three choices; Obamacare, the Republican Plan that would return healthcare to something like the system that preceded the Affordable Care Act, and “Medicare for All” as proposed by Senator Bernie Sanders.

He favored the Republican plan of retrogression, because it kept an individual’s choice for care their own, rejected the ACA, basically because Republicans have fought it from its inception, and rejected Medicare for All because American’s healthcare would be left to the decision of bureaucrats. 

The commentator made the remark that, Medicare for All would create disasters like the one that occurred in the nursing rehabilitation facility in Florida where eight residents died during Hurricane Irma.

No one questioned that comment and that is a problem.

The spokesperson for Rehabilitation Center at Hollywood Hills stated that they turned the facility’s thermostats down to 67 degrees F, in order to make the facility as cool as possible should the building lose power.  The facility maintained power, but the chiller failed resulting in humid warm air going to patient rooms.

The result was that eight patients died and their deaths are being investigated as criminal homicides.  The nursing home has since been closed.

When asked why the nursing home director did not call 911 the spokesperson replied that they repeatedly called a private number that the governor had given nursing homes in the event of problems with power.  The office of Rick Scott (R) governor states that the calls were referred to the utility company.  No one called 911.

Who was responsible?  Was this a government bureaucratic failure as the nursing home claims or something else?

“Several executives of a limited liability corporation that controls the nursing home declined to comment, including the principal owner, Florida resident Jack Michel.”

Who owns “Hollywood Hills”?  Is it a state or federally owned facility that is managed by a for profit company?  Is it owned by a for-profit company that is paid by some combination of private insurance, Medicare and Medicaid?  I’m sure that all of that will come out in the criminal investigation.

The question behind these questions is whether government bureaucracy is any more inefficient or expensive than non-governmental administration.

According to one study– now 20 years old – the cost of administration is higher in for-profit than in other types of hospitals.  The cost in the early 1990s of hospital administration was 24.8% of total costs on average for U.S. Hospitals.  This was almost twice the cost of administration of Canadian hospitals.  Furthermore, despite the anticipation that for-profit hospitals would find greater efficiencies than non-profits and lower the costs of healthcare, the reverse was true.  Greater costs were secondary to greater charges for ancillary services and a higher cost of administration.

A comparison of costs of administration across eight nations found that the cost of administration in 2014 exceeded all other nations by far, and remains unchanged from 1990 with a current cost of 25%.

Furthermore, the cost spread between public (teaching hospitals), non-profit, and for profit hospitals was not as great as might be expected at 23, 25 and 27% respectively.

  • “U.S. hospital administrative costs rose from 23.5 percent of total hospital costs ($97.8 billion) in 2000 to 25.3 percent ($215.4 billion) in 2011. During that period, the hospital administration share of national gross domestic product (GDP) rose from 0.98 percent to 1.43 percent.”

The cost of administration in the Netherlands was 20%, in Great Britain it was 16%, and in Canada it was 12%.  The cost of administration was related to how complex the reimbursement system was; the more complex the system (multiple payers and types of payers) the higher administrative cost.

Returning to the questions about the Rehabilitation Center in Hollywood Hills:

Rehabilitation Center at Hollywood Hills, LLC in Hollywood, FL, is rated 1.8 stars overall. It is a large facility with 152 beds and has for-profit, corporate ownership.”

The attitude by some is that private ownership is a force for ensuring safer and cheaper services and products.  That is a false assumption.  Owners seek to maximize profits, and in a system with fixed reimbursement the only way to maximize profits is by reducing costs.  Sometimes requirements for safety and quality are regarded as unnecessary expenses.

Healthcare facilities, regardless of their type, undergo inspections by various agencies.  Many of institutions voluntarily undergo inspections by an organization that is all encompassing in order to avoid multiple inspections. Those organizations typically have deemed status meaning that their inspection is deemed sufficient to substitute for the mandatory inspection.

In hospitals JCAHO serves as such an organization.  In hospital laboratories the College of American Pathologists (CAP) inspection serves instead of the FDA (blood bank), HCFA, and other federal agencies.

Nursing homes are rated on a star system with 5 being best.  Indicators are adequacy of RN staffing and general staffing, and meeting a set of Quality Measures (QMs). 

The Hollywood Hills facility had a star rating of 1.8.  How does that compare to other nursing homes?

Facility ratings are determined using these criteria:

 • The best 10 percent in each State receive a five-star rating.

• The middle 70 percent of facilities receive a rating of two, three, or four stars, with an equal number (approximately 23.33 percent) in each rating category.

• The worst 20 percent receive a one-star rating.

I’m guessing that the deaths at the Hollywood, Florida nursing home were not due to governmental bureaucracy.  I would guess that getting a rating in the bottom 20% of nursing homes requires some combination of inadequate staffing and persistent safety violations.

Over a career of 30 years I worked in not for profit, for profit and public (county) hospitals.  One hospital was owned by an individual.  I only went there occasionally, but it surely skirted regulations.  The two for-profit hospitals were part of chains.  One was an HCA hospital which concentrated on providing services that paid well and avoiding those that didn’t.  The other AMI hospital was barely operational due to inadequate patient numbers.  The entire system was extremely top heavy in administration with local, mid-level and top level administrators.

The non-profit hospitals offered full services, but were definitely managed to produce “income in excess of expenses”.  Over the decades there was title inflation.  Hospital administrators became presidents and the CEOs.  Heads of nursing became Vice-presidents of Nursing.  The number of managers in each vice president’s purview seemed to expand steadily even as there were freezes on hiring for nursing personnel.

My mother-in-law is in a nursing home in West Memphis.  The facility has an overall rating of 4 stars.  I would have guessed about that. It’s not the best I’ve ever been in, but it is so much better than the ones that smell like urine, have surly employees, and not enough of them.

None of this answers Lindsay Graham’s stance that he would rather have a population of middle class to wealthy Americans with the ability to choose their insurers, insurance plans and provider while a sizable minority have either no insurance or inadequate insurance  That is, in my opinion, a morally indefensible position.  There is no rational, fact based way of countering an argument that sees healthcare as a privilege.

Views: 209

Comment by Rodney Roe on September 17, 2017 at 4:39am

Terry, thanks for your comment.  I thing the "bigger houses" analogy is apt.

Over my career I saw the advent of CAT scans, MRI, laboratory analyzers that could do 20 tests at a time on a drop of blood in seconds, and a lot of changes that were in part good, but in part merchandising.  

As an example:  Two hospitals in the Dakotas got into a war over access to patients.  One got a helicopter.  The other got a helicopter with a nurse on board.   The other got a twin engine helicopter with a nurse on board..  The other got a twin engine helicopter with a doctor on board...

Comment by Rodney Roe on September 17, 2017 at 6:01am

You should see the cancer center at Duke.  There are coffee shops, a pianist (the other day it was a cellist) beautiful art work, a woman on many trips with a blue merle Aussie therapy dog...

Comment by Safe Bet's Amy on September 17, 2017 at 6:23am

There are coffee shops, a pianist (the other day it was a cellist) beautiful art work, a woman on many trips with a blue merle Aussie therapy dog...


Both you and Terry the Terrible are making all of the things you mentioned sound like bad things for a hospital to have done.

Coffee shops give distraught family a place to congregate in relative comfort (ever had to sit in one of those cold, sterile waiting rooms?).  Have you considered that the piano was most likely a donation and that the piano player/cellist and lady with the dog were most likely volunteers?  Have you factored in that a faster, longer range helicopter (assuming that is what the two engines do) with a doctor saves many more lives?

I'm certainly not defending the Republican faux-healthcare (cuz it ain't), but I also am not going to defend Obamacare because it is just as bad (admittedly in different ways).  IMO reducing insurance company control AND hospital admin control (both of which are ALL about the money) is a good thing if you actually give a shit about patient care.

Comment by Safe Bet's Amy on September 17, 2017 at 8:11am

So any woman who disagrees with you obviously must be "angry", Terrance?  How very sexist and chauvinistic of you to say so.

P.S.  Your use of "our" is so blatantly paternalistic as to not even bear mentioning, btw.  

Comment by Rodney Roe on September 17, 2017 at 12:45pm

I enjoy all of the amenities at Duke Cancer Center.  The Emergency Department where I used to work was for several years the "doctor's office" for all of the mill workers who no longer had jobs or insurance.  The waiting room was just a sterile room with chairs.  My office looked out on the parking lot.  Perhaps my most memorable sight was a rail thin bleached blonde woman getting out of a car clutching two cartons of cigarettes in one hand and two liters of Sun Drop (a citrus flavored non-cola soda known to have a high caffeine content and associated with a high risk of getting kidney stones..  She had come to spend the day.  At that time the average wait was six hours, and our little hospital had the third busiest emergency in the state.

The campus became non-smoking later, and the unemployed turned to cooking meth and prostitution and pimping.

All of that was driven by market forces which made it cheaper to have clothing made in third world sweat shops.  The Right likes to say that the market knows best.  

Comment by Rodney Roe on September 17, 2017 at 12:51pm

Amy, the niceties are not the problem.  The coffee shop and everything else at Duke makes the cancer checkups and treatment much more pleasant.  The niceties are only a problem when the come at the expense of other services.

Comment by Boanerges on September 17, 2017 at 1:10pm

1. Who do I trust? The Canadian/Ontario healthcare system. (For free access to doctors and speedy treatment, that is, no matter what you may have read. For an actual hospital experience, see (4)). I happily pay taxes for this to be the case for all people, because I can remember what it was like before. It was evil.

2. If I recall correctly, so-called Obamacare (actually, the ACA) was based originally on a Republican health care initiative -- it was the only way he could get ANYTHING through an obstructive Congress. If I'm wrong, someone please correct me.

3. No less than Jimmy Carter came out in full support of single-payer after his collapse and hospitalization from heat prostration in Winnipeg, Manitoba last July.

4. My last stay in hospital -- for removal of a cancerous kidney in 2016 -- was a horrible one. I couldn't wait to get out. Had the surgery Wednesday and was home, at my insistence and with the misgivings of the specialist, on Saturday. The place was a pigpen, with so-called cleaning staff sleeping in waiting rooms on the midnight shift. The only bright, clean spot was the Tim Hortons on the main floor ... and it served inedible crap, according to Red. The experience was similar to this.

Comment by Ron Powell on September 18, 2017 at 12:35am

Re the piano and musicians, Amy is correct. This summer I played for two hours a day  three days a week at the cancer care center at the Yale University Hospital in New Haven. The piano had been donated and the musicians are all volunteers.

This practice is replicated thousands of times over across the country. 

There's absolutely no additional expense to the hospital that would then be passed on to patients....

"...There is no rational, fact based way of countering an argument that sees healthcare as a privilege..."

The second paragraph of the United States Declaration of Independence starts as follows: "We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the Pursuit of Happiness."

There is no rational, fact based argument for this radical and revolutionary assertion.

The issues and narratives regarding health-care are currently predicated on a model and paradigm that involves the profits and profit motives of insurers.

Health-care insurance may be deemed a privilege, but health care should be characterized as and deemed a natural human right.

However, if  all human beings are endowed with the unalienable right to life,  then it must follow that we have, as a matter of right, that which is necessary  to support and sustain life namely: food, clothing, shelter, and health care.


Comment by Rodney Roe on September 18, 2017 at 1:07am

Boanerges, you are right about the ACA’s origins, but you should know that the approach was designed as a poison pill alternative to then First Lady Hillary Clinton’s proposal for Universal Healthcare.  It was never planned as a real alternative.  Despite that, it was adopted by Massachusetts, and that state system became the model for “Obamacare”.

The Legatum Institute (London) published a ranking of healthcare systems in the world and, based on overall health of the population, healthcare infrastructure and availability of preventive care found that the top 5 national systems belonged to 1) Luxembourg 2) Singapore 3) Switzerland 4) Japan 5) Netherlands.

All of the countries in the top 20 were industrialized, wealthy nations.  Great Britain which pioneered free-at-the-point-of-entry healthcare was twentieth and Canada’s system was sixteenth.  It was noted that the number of Canadians going south to the U.S. for care has grown in recent years.

France, once ranked number one in the world is now ranked fourteenth.

Every ranking system comes under fire from countries that did not rank highly.  The WHO ranking in 2000 placed the US at 37th n the world based on spending per capita versus overall health and availability of care.  The uproar was sufficient that the WHO declined to attempt ranking systems again.  The Commonwealth Fund later ranked systems and the US came in dead last in the world.

Comment by Rodney Roe on September 18, 2017 at 2:01am

Ron, the confusion of healthcare and health insurance has become so deeply ingrained that it is hard to think of them separately.  The fact that over one percent of the GDP goes to pay hospital administrators and that the growth in that fraction is related directly to how complicated the insurance system of reimbursement has become is alarming.  Any real reform, one that would create a single payer with universal care will be wrenching because a large part of our GDP goes to an entrenched system in which insurers avoid paying and beneficiaries expend excessive resources trying to improve payment and make it more timely.  

If, as Terry has claimed, insurance companies don't really want to offer health insurance then there should be no complaint from that end of the system.  Instead, it will be from all of the employees in administration who have become quite comfortable.


You need to be a member of Our Salon to add comments!

Join Our Salon


Hooking up on BS

Posted by Robert B. James on June 24, 2019 at 7:47am 3 Comments

Just a Little Too

Posted by Doc Vega on June 24, 2019 at 1:39am 0 Comments

Water View II

Posted by koshersalaami on June 23, 2019 at 3:00pm 11 Comments

The Merlin Of BindleSnitch

Posted by Robert B. James on June 23, 2019 at 7:07am 6 Comments

Old Soft Shoe (POEM)

Posted by J.P. Hart on June 22, 2019 at 1:00pm 4 Comments

I saw one Mountain Lion

Posted by Robert B. James on June 22, 2019 at 8:00am 3 Comments

A Measure of Intelligence

Posted by Doc Vega on June 21, 2019 at 1:50pm 0 Comments

© 2019   Created by lorianne.   Powered by

Badges  |  Report an Issue  |  Privacy Policy  |  Terms of Service