Union leaders study sale plan

The unions are checking out the proposed buyer's labor history.
By WILLIAM K. ALCORN
VINDICATOR STAFF WRITER
YOUNGSTOWN -- Union leaders remain skeptical but say that Forum Health's latest bombshell, that it is negotiating to sell the nonprofit hospital system to a national for-profit health-care firm, could be a good thing for this community and their membership.
In the meantime, the unions have their state and national staffs checking out the labor relationship history of the proposed buyer, Community Health Systems, based in Brentwood, Tenn.
Tom Connelly, president of American Federation of State, County and Municipal Employees Local 2026, said he is "guardedly optimistic" about the sale.
Local 2026 represents nurses at Forum Health Trumbull Memorial Hospital in Warren.
It could mean an infusion of cash to handle the hospital system's debt, improve health services to the community and provide job stability for employees, Connelly said.
"It doesn't seem CHS likes to come in and sweep everybody out. If that's accurate, I'm encouraged," Connelly said.
"We will be glad to engage in any kind of constructive conversation to make sure that TMH stays on course to be as good a hospital as it is. But, we're still going to assess the situation," he added.
Factors
"It could be a great thing if CHS wants to come into the area and grow the system and be a good employer," said Eric Williams, president of Youngstown General Duty Nurses Association. It all depends on the structure of the deal, he added. The YGDNA represents nurses at Forum Health Northside Medical Center here.
In a memo, Dr. Keith T. Ghezzi, interim president and CEO of Forum Health, said CHS would provide substantial resources and the investment capital necessary to upgrade Forum's facilities, enhance services and preserve quality health care and choice for this community.
Through its subsidiaries, CHS owns or operates 76 hospitals in 22 states. Forum Health would be its first in Ohio, says its Web site.
"While we have to acknowledge that this could be positive, it's not a foregone conclusion. We don't know CHS' business plan and commitment to local services. We need to know more before making that judgment," said David Regan, president of Service Employees International Union District 1199.
SEIU District 1199 represents about 1,400 of Forum's 5,000 employees.
No matter how benign the takeover is, it would bring dramatic changes to Forum Health, Regan added.
Some concerns
Regan said SEIU has several points of concern. They include:
CHS is a for-profit, out-of-state corporation that is actively expanding across the United States, which raises issues of local control and appropriate business philosophy, given Forum Health's history as a not-for-profit hospital.
CHS has historically focused on acquiring nonurban hospitals in markets where there is no significant competition. Forum Health serves urban populations and operates in a competitive market.
Given its track record, CHS' business plan for the Mahoning Valley will undoubtedly include the erosion of quality jobs through the elimination of job security and employee benefits as well as the substantial outsourcing of vital services to the national organization.
It is unclear if CHS is committed to maintaining the current level of health-care services now provided by Forum Health; and it is unclear whether Mahoning Valley residents will maintain any meaningful level of local control if CHS acquires Forum Health.
This decision marks the beginning of a long process that demands and deserves public accountability and transparency, Regan continued. The Valley should settle for no less than a solution that protects quality health care and quality jobs, he said.
SEIU maintains that there is a way to preserve the financially troubled hospital system without reducing services to the community. The union intends to thoroughly monitor and participate in all steps of the process, Regan said.
Forum began the year predicting a $60 million operating shortfall for this year. Last month, officials revised the projection to break even or even earn a small profit.
The larger point is the typical profile of a CHS purchase is nonunion, small and nonurban, he said.
About agreement
Rosemary Plorin, CHS spokeswoman, would not talk about specifics of the proposed deal. But, she did say the letter of intent includes a "no-shop" agreement, which means Forum won't be talking to other potential buyers during the due diligence process, which typically takes several months.
Plorin said the picture of CHS' buying only in nonurban, noncompetitive areas is no longer true. She noted a recent purchase in Waukegon, Ill., just north of Chicago, and several facilities in highly competitive areas in Pennsylvania.
She said CHS generally buys hospitals from municipal governments, although the Waukegon purchase was a nonprofit like Forum.
Typically in CHS-owned facilities, there is a local board of trustees. In most instances, the change of ownership is seamless, keeping the same medical staff and employees; and the name of the facility usually does not change, she said.
"Part of CHS' strength is in working with local communities," she added.
But, Regan said there is a fundamental difference between nonprofit and for-profit health care.
In for-profit health care, all pretensions about mission and other features finish second to a continual drive to make money for shareholders, and the needs of the community are going to finish a distant second to the needs of shareholders. To believe otherwise is naive, he said.
He said SEIU also is concerned about what extent CHS plans to outsource services to other places.
Because of the unusual nature of what's being done -- only a handful of transfers of hospitals from non- to for-profit have occurred in Ohio -- there will be a lot of transparency. Also, the law requires at least one public hearing be held in the county.
Other issues
This institution is too important to the community to allow a handful of people (the board of trustees) to make the decisions without talking first to the stakeholders, he said. The community supported and used Forum Health facilities for decades, Regan said.
One of the issues raised when Forum talked about building a for-profit hospital is whether a for-profit hospital system would provide the same level of charity care as a nonprofit, and if Forum's head-to-head competitor in the Mahoning Valley, Humility of Mary Health Partners, would have to provide more than its current share.
Both systems provide millions of dollars' worth of charity and other uncompensated health care each year.
HMHP issued a brief statement on the matter.
"HMHP will continue its long tradition of charitable service to the people who need us the most. We will continue to act in fiscally and socially responsible ways to deliver the finest health care to our community," said Tina Creighton, HMHP spokeswoman.
alcorn@vindy.com