Clark County commissioners deciding how to reverse UMC’s bleeding budget

Clark County commissioners in the coming months will decide one of the most important issues before them: what to do about University Medical Center.

The county hospital has been hemorrhaging money for years, and many agree that taxpayers can't keep subsidizing the facility at current rates much longer.

What commissioners decide - hand off management to someone else, find new sources of funding or find a different way to care for the poor - probably will have a long-lasting effect on health care in Southern Nevada.

"I think that UMC is one of the biggest issues that we're going to be facing as a county commission in the next year," Commissioner Steve Sisolak said.

But few issues have proven more divisive.

"The challenge for the commissioners is: How do we enter this new century with a model that will be sustainable going forward?" UMC CEO Brian Brannman said.

CHANGING GOVERNANCE

Many of UMC's problems are fundamental. It's a hospital in central Las Vegas, surrounded by private hospitals that line the suburbs and attract most paying customers, who choose to go to a facility near their home.

That leaves UMC caring for many people who either can't pay or use the low-paying Medicaid program.

And it leaves taxpayers subsidizing their care - the hospital has lost more than $70 million each year for the last three years.

Most commissioners say they have to find a new source of funding, and fast. Consultants the county hired warned them last year that without "major, dramatic and profound change," the hospital will be forced to close in a few years.

But what kind of change is needed?

Brannman said he can make the hospital more attractive to all customers, not just the poor, if he can operate more like for-profit hospitals.

"I think we are able to generate revenue if we can be put in a posture to be more competitive," he said.

He has to ask commissioners for approval for all sorts of hospital contracts and functions - on Tuesday, for example, commissioners will be asked to approve a contract for new molecular lab equipment so they can get tests results more quickly.

Not only is the process slow-moving, but it gives the for-profit hospitals a heads-up on any new services UMC is providing, Brannman said.

To make the hospital more competitive, the county's consultants are recommending converting the hospital to a nonprofit "public benefit corporation" that would require commissioners give up much of their oversight to a full-time board that could include a couple of commissioners, health experts and other members of the community.

That's the way many public hospitals in other areas have been going. The New York City Health and Hospitals Corporation was created decades ago and today manages 11 hospitals and numerous clinics and treatment centers, for example.

But even that hospital system has faced budget constraints in recent years as the number of people without insurance has risen.

LONG-TERM GOAL

Merely transferring the management won't change the hospital's fortunes, however.

Brannman said the hospital would need a serious "rebranding" and would have to offer unique or top-notch services.

Las Vegas has a higher concentration of for-profit hospitals than any other urban area in the country, and it's the only one its size or larger without an academic medical center, the Las Vegas Sun found in its 2010 investigation into local health care.

That gives UMC the ability to stand out. UMC already has something that no other hospital in the region has: a partnership with the University of Nevada School of Medicine.

Many of the nation's finest hospitals are academic medical centers partnered with a major university - think the UCLA or Stanford medical centers. Although UMC renamed itself in the 1980s to play up its relationship with the medical school, it's not a true academic health center.

It doesn't have the capability for serious research, but Brannman would like that to change, eventually. He said it could be 15 years away.

NOT EVERYONE AGREES

A change of governance already has some momentum. Last month four of the seven commissioners voted to use one of the county's legislative bill draft requests to ask the Legislature for approval to change the way the hospital is governed.

But they haven't decided the details of the governance yet, which will have to be submitted before the Legislature meets in February.

And the commission is split on what changes are needed.

Lawrence Weekly said he has serious concerns that a decision could still be made to close the hospital or greatly reduce its obligation to indigent patients.

"I feel that there are those out there that would love to see this indigent-care hospital just go away," he told fellow board members last month.

Chris Giunchigliani said making a decision about the hospital before the Legislature meets feels rushed.

She said the county can find other sources of revenue without drastic changes, such as asking the state to pay more for Medicaid or asking the cities of Las Vegas and North Las Vegas to help share UMC's costs. Residents of both cities use the hospital.

And she has concerns about giving up so much oversight under the nonprofit model. The county would still be paying a significant amount of money for indigent patients.

"If I'm going to be on the hook for the money, I want to know where it's going," Giunchigliani said.

Sisolak, who feels something needs to change, said UMC won't go away.

The hospital, which, in addition to its caring for the poor, is also the only level-one trauma center in or near Southern Nevada, is too important.

"The hospital's not going away," he said. "We have a legal, moral obligation to provide care."

But he said the county can't continue to write blank checks.

"I think we have to do something," Sisolak said. "What we're doing is not working. What it should be, I don't know."

The county's consultants are expected to present some kind of plan in the next few weeks or months, and commissioners will have the chance to approve it or go in another direction.

Brannman said no matter the change, he wants a simple result: "I want to see UMC around for a long, long time."

Contact Lawrence Mower at lmower@reviewjournal.com or 702-455-4519.