Hospitals agree on elective surgery

Providence St. Peter Hospital has dropped its appeal of a ruling that awarded Capital Medical Center the right to perform elective angioplasties as part of a three-way settlement announced Tuesday by the two Olympia hospitals and the state Department of Health.

As part of the settlement, Capital has agreed to boost its level of charity care to the regional average by the end of 2013, Capital Medical Center Chief Executive Jim Geist said Tuesday.

“I’m very happy to get this appeal behind us so we can move forward to provide quality cardiac care services to the people of the greater Olympia area and make a renewed commitment to providing a higher level of charity care,” he said.

Key to Tuesday’s settlement was much more specific language about how much charity care is going to be provided by Capital Medical Center and how it will be enforced by the state, St. Peter spokeswoman Deborah Shawver said. “We are satisfied that this is an ironclad settlement and the definition of enforcement is laid out,” she said.

Capital Medical plans to boost its charity care to the regional average over the next three years. As of 2008 data, that regional average was 2.37 percent of gross revenue and 5.33 percent of adjusted revenue. That same year Capital Medical’s charity care amounted to 0.10 percent of gross revenue and 0.18 percent of adjusted revenue, while St. Peter’s was 3.34 percent of gross revenue and 8.28 percent of adjusted revenue.

“We recognize that we haven’t always done as well as we would’ve liked in identifying patients who could qualify for indigent and charity care,” Geist said.

Since 2008, though, Capital Medical’s level of charity care has increased, rising to 0.48 percent of gross revenue and 2.28 percent of adjusted revenue as of the second quarter, he said, adding that even Providence officials have worked with Capital Medical to help improve its charity care delivery.

If Capital Medical fails to meet that standard, the Department of Health can suspend or shut down the hospital’s elective angioplasty program, but that wouldn’t happen overnight, said Bart Eggen, an executive director at the agency.

The department would review hospital records, financial records and make an on-site visit before taking such a step, he said. “I hope it never comes to that,” Eggen said. “We’re excited and they believe they can hit those targets.”

Tuesday’s agreement between the two hospitals ended the dispute much more smoothly than it began.

Capital Medical last year applied to the state Department of Health to offer the artery-clearing procedure on an elective basis after performing them on an emergency basis for years. Previously, though, Capital Medical had to send its patients to Providence for the procedure.

After the application was filed, Capital Medical officials argued they wanted to offer elective angioplasties as a convenience to their patients, while Providence officials grew concerned that sharing the procedure would steal revenue vital to providing charity care.

Both sides have acknowledged that the elective angioplasty procedure is lucrative. Capital Medical won the right to offer the elective procedure last fall, and Providence appealed that decision in November.

Rolf Boone: 360-754-5403