Business and labor group considers building hospital

Michelle Swafford

Thursday, Feb. 3, 2005 | 11:13 a.m.

The Health Services Coalition, a group of 23 union and employer groups that represent about 320,000 valley residents, is considering building its own hospital to save costs.

The coalition plans to "take a fresh look at building our own hospital now that we have the size of the coalition and the far greater expertise to do so today," said Andy Brignone, lawyer for the coalition and several of its members. "That concept has emerged in the last week or so and is now being actively addressed by the coalition members."

The Culinary Union, a member of the coalition, conducted a feasibility study on constructing a hospital several years ago.

Building a hospital to compete with the current hospitals is one of multiple options under consideration because the coalition is struggling to agree to hospital rates with current hospitals, Brignone said.

New hospitals in the southwest part of Las Vegas have ranged from $70 million to $140 million for construction, which does not include the costs associated with operating a hospital. It takes at least 18 months to build a hospital.

The coalition -- a nonprofit group that represents fire fighters, police officers, teachers, construction workers and hotel and casino employees -- has been negotiating with Las Vegas Valley hospitals for several months.

The coalition and hospitals have declined to say how much each party wants for a contracted rate. But, coalition spokesman David Kallas said the coalition is looking for rates of less than 10 percent and hospitals are seeking rates of between 15 percent and 20 percent.

The initial contract expired Dec. 31, but was automatically extended to Jan. 31 because no agreements had been reached. Late Monday, hospitals agreed to negotiation extensions of between 7 days and 10 days.

This week "there has been some progress, but not sufficient progress," Brignone said of the negotiations. "Our goal is affordable hospital rates for our members. We're not there yet. The negotiating has been intense and ongoing."

There has been the most tension with HCA Inc., owner of Southern Hills, Sunrise and MountainView hospitals, Brignone said.

"It is true that their rates are higher than our target rates and their target rates are even higher than what their own executives in Nashville have said their target rates are nationally," he said, adding that the corporate rates are "still demanding of Las Vegans."

Hospital officials have said they are working with the coalition, but that their operating costs are escalating. For example, blood-processing costs doubled, and equipment, malpractice, utilities and nursing costs are high.

"It's hard for us to accept their increases to cover their costs," Brignone said. "You have out-of-state hospital conglomerates who have come to Nevada viewing its population growth as an ideal opportunity to make money that they then shift back to headquarters to fund their operations elsewhere and Nevadans shouldn't bear that burden."

The coalition is not insensitive to the hospitals' financial needs, he said.

"We may reach different kinds of agreements with different hospitals based on their different needs," he said. "We would prefer to have the hospitals as our health care partners, not as our health care adversaries."

The Health Services Coalition, formerly known as the Health Services Purchasing Coalition, is holding a press conference today to update its members on the coalition's goals and the status of negotiations.

"Having negotiating intensely for the last couple of days and not achieving the progress we had hoped or expected, it's time for us to let the members know where we stand," Brignone said.

The coalition and hospital executives have said they do not want to negotiate the contracts through the media, but the coalition has taken out two full-page ads in the Las Vegas Sun and the Las Vegas Review-Journal that said hospitals "prices are up, quality of care in many instances isn't."

Brignone said quality patient care is a key coalition issue because it benefits its members and the rest of the community. He said the coalition collected state and national reports and statistics on quality measures and hospital profitability.

During the 2002 contract negotiations, the coalition enlisted the help of Gov. Kenny Guinn and a few state legislators.

Recently, the coalition contacted state officials for assistance, but none of them are officially involved with the negotiations, Brignone said, adding that he expects consumer-protection bills to be proposed in the upcoming legislative session.