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Cancer competitors joining up

The biggest competitors in cancer care in Southern Nevada – one for-profit and one nonprofit – appear to be forging a deal to collaborate.

Negotiations aimed at expanding “the breadth and scope of cancer care and clinical research offered to the Las Vegas community” are under way between officials with the for-profit Comprehensive Cancer Centers of Nevada and the nonprofit University of California San Diego Health System and the UCSD Nevada Cancer Institute.

That disclosure came Monday in a joint statement released to the Review-Journal by all three parties.

The statement also said the three parties had begun “exclusive negotiations regarding future collaboration” on Sept. 17.

No further information will be made available until the end of the week, according to Kevin Dunegan, the public relations professional who released the statement.

A source close to the negotiations said medical practitioners with Comprehensive Cancer Centers of Nevada, an affiliate of The US Oncology Network, which provides more than 60 percent of the cancer care in the Las Vegas Valley, would occupy a large portion of the flagship building of the original Nevada Cancer Institute, which, after going bankrupt in December, was purchased by UCSD.

“Comprehensive would focus on the clinical aspects of things like chemotherapy, radiation therapies and imaging, while UCSD would expand into more innovative clinical trials,” the source said, adding that UCSD also may bring specialty groups to the facility, which could include ob-gyn and cardiology.

A foundation now in place to support the institute would help fund those “cutting-edge clinical research trials” currently not available, the source said.

No details were given about how revenue would be divided from medical services provided at the institute.

Such a business collaboration ­- which one physician said would be healthier than the current situation, “which is competitive rather than collaborative” – has spawned speculation by other physicians and health policy experts that the arrangement is a sign that UCSD has already run into financial problems in Las Vegas.

For $18 million in January, UCSD purchased the institute’s 142,000-square-foot, four-story flagship building, its medical practice and its contracts, including clinical trials.

To Chris Cochran, an associate professor of health care administration and policy at the University of Nevada, Las Vegas, “it is obvious they’re not getting the referrals” needed to make a go of it.

If business were going smoothly, another doctor said, it’s doubtful that a new buyer of a property would turn over much of the daily operation of the money-making clinical side of cancer care to another entity.

“I believe they did not understand how difficult it would be for someone from out of town to crack into this market, particularly in this economy,” Cochran said.

The institute had seen about 17,000 patients over a five-year period before UCSD’s purchase, while Comprehensive cares for about 25,000 people each year.

Dr. Al Capanna, a neurosurgeon who studies medical economics in Southern Nevada, said he believes UCSD thought it could “immediately get market share … but the biggest problem in this community is everyone is trying to grab the insured population, which has shrunk incredibly in the bad economy. There’s just not enough paying patients.”

UCSD officials were unavailable for comment Monday.

In May, Mickey Goldman, the CEO hired by UCSD, told the Review-Journal that the institute could handle five times the 80 to 100 patients it saw per day. In August, the institute’s new director, Dr. John Sweetenham, said he, too, believed more patients needed to be seen at the institute.

Many area doctors had said that in the past, they did not refer patients to the institute because they believed their professionalism had been “bad-mouthed” by institute officials, including one of the co-founders, Heather Murren.

Without plentiful referrals – the lifeblood of specialized medical centers – financial problems quickly arise.

Murren said that the doctors who complained about being criticized were too thin-skinned, and that she was just quoting mortality statistics.

Physicians also told the Review-Journal that some people affiliated with the institute had said for-profit Comprehensive cared more about profits than patients, which angered many of the doctors in the medical group.

Should Comprehensive and the institute now collaborate, one physician said, it proves that “necessity is the mother of invention.”

Neither Heather Murren nor her husband, institute co-founder Jim Murren, chairman and CEO of MGM Resorts International, were available for comment Monday.

Last spring, Goldman, defending why the institute had taken such a low profile since the purchase, said that “the previous organization … didn’t reach out to the medical community as effectively as they could have. … UCSD is not coming into town as a heavy-handed 800-pound gorilla. We want to be supportive.”

It is unclear whether UCSD was ever able to accomplish one of the first initiatives announced when it bought Nevada Cancer Institute – re-establish contracts with health insurance plans such as United Healthcare and Humana Gold that the Nevada clinic had lost.

Tax records showed that the bankrupt institute was using donations for 50 percent of its operating budget, when most health policy experts say the amount can be no more than 10 percent.

UCSD officials told the Review-Journal that they would never run a medical facility that way.

The purchase of the Nevada Cancer Institute by UCSD was a first by the University of California. UCSD is alone among the system’s five academic medical centers in buying clinical property outside California.

In approving the purchase, the University of California regents were concerned about the perception of a state institution using its resources to buy something outside the state. So the deal was constructed so that there would be not net financial loss to UCSD.

The deal went down only after Nevada Cancer Institute officials agreed to raise $20.8 million over five years for the UCSD Nevada Cancer Institute.

Dr. Jerry Reeves, an executive with HealthInsight, a private, nonprofit community-based organization dedicated to improving the health care systems of Nevada, New Mexico and Utah, said a collaboration between Comprehensive and UCSD could be good for Las Vegas.

“We need more team-based care,” Reeves said. “I’d rather see good oncologists working together than apart.”

He also said UCSD may bring in young doctors from the medical school in several areas to train in Las Vegas.

“We need to remember that where doctors train in specialties is generally where they stay,” Reeves said.

Contact reporter Paul Harasim at pharasim@
reviewjournal.com or 702-387-2908.

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