Buffalo Report 1 March 2002The Kaleida Wars
by Bruce JacksonThe Peace Bridge expansion project seems to be plodding toward some kind of resolution and County Executive Joel Giambra has put the proposed new convention center in the deep freeze for now. It could come back – bad ideas rarely seem to die around here, but sometimes they do get sufficiently moribund so we can turn our attention to more useful endeavors.
Kaleida's Downward Spiral
But the Erie County health care crisis is getting worse and more acrimonious. There's a huge amount of noise, posturing, information-managing, press-conferencing. The decibels go up – and the health care crisis keeps getting worse and more acrimonious.
What can be done about the problematic rate of reimbursement for physicians from HMOs and insurance companies? Physicians say they payments are significantly lower than any place else in New York. Small businesses say increases in health care costs make the difference between survival and extinction. What is the import of the decision of the Catholic Health System to go it alone, to cherry pick the most lucrative specialties, leaving the less profitable and attractive work to Children's and ECMC? What will happen with UB's attempt to get control of the county's medical residency programs for the first time? Will ECMC and Erie County manage to work out an amicable divorce?
At the heart of all these discussions is Kaleida Health's downward-spiraling financial mess. Kaleida was created four years ago to bring financial stability to four of Buffalo's hospitals: Millard Fillmore (Gates Circle and Suburban), Children's, Buffalo General, and DeGraff Memorial. Because of outside forces, bad luck, mismanagement, or a combination of the three, the financial condition of all but one of those hospitals has gone, in hospital terms, from guarded to critical.
Kaleida Health spent $2 million for a study they don't dare release because it shows how inefficiently the system has been managed. Kaleida's former boss John Friedlander reportedly departed with a $7 or $8 million golden parachute. Carrie Frank, Kaleida's chief operating officer, and William D. McGuire, Kaleida's president and chief executive officer, told a private meeting of Buffalo News staff that they had no idea how much Friedlander left with. How can anybody take with any seriousness an organization in fiscal dire straits the two top executives of which are willing to admit in public they don't know whether or not they just wrote a departing employee a check for $7 or $8 million?
The Fate of Children's Hospital
The bitterest Kaleida question at the moment has to do with the fate of Children's hospital. Will it be moved to and absorbed by Millard Fillmore-Gates Circle or Buffalo General Hospital, as the Hunter Group, Kaleida's cut-throat consultants, suggested, or will it stay where it is? Will it continue as a unit of Kaleida or will it break free, thereby reverting to the status as a free-standing children's hospital it had before Kaleida was organized on April Fool's Day, 1998?
Kaleida officials bruited about the possible Gates Circle move right after they released a small fragment of the Hunter Group report. Word around town is, the only reason for that suggestion is the orthopedists don't want to go to Buffalo General and Kaleida wants to get more orthopedic work done at Gates Circle to take pressure off Millard Fillmore Suburban. But orthopedic work isn't enough to keep Gates Circle going – the place is too big for that – so they came up with the idea of stuffing Children's in there, even though the facilities are woefully inadequate for a children's specialty hospital. But, I've heard, Hunter also made another recommendation that Gates be closed entirely within the decade, which would require a second shift of Children's, assuming Children's went to Gates in the first place.
Which it's not going to do. Lately, Kaleida officials hardly mention Gates Circle. In public statements, they talk almost entirely of moving Children's to Buffalo General on High Street. Buffalo General needs the work, since it has a difficult time filling even half of its beds. Buffalo General is the big money-loser in the system, but Kaleida won't even consider shutting it down because that would scuttle the High Street medical district dream.
Other than vague platitudes, no senior Kaleida official is saying anything about what that kind of move will do to Children's Hospital.
The Peace Bridge Redux
Much of what is going on with Kaleida and Children's reminds me of the war between the Buffalo and Fort Erie Public Bridge Authority and the community before Judge Eugene Fahey told the PBA they had to obey New York's environmental law if they wanted to expand bridge capacity. In Kaleida, as at Peace Bridge Plaza, a small group of people meet in private to make decisions that will have profound implications for the entire community. They say they have data which makes it all make sense (which they will not release) and they've undertaken a huge advertising campaign in an attempt to defeat an opponent with hardly any money at all. They hired the same public opinion consultant the PBA hired, and he's once again asking questions that seem loaded to produce a desired result, just as he did for the PBA. They refuse to hold public hearings, though they frequently make public announcements.
That's not all Kaleida and the Peace Bridge share. The boundaries between private business relationships and considerations and public service obligations got very murky in the Peace Bridge affair and they're starting to get very murky in the Kaleida affair. For example, Kaleida just appointed developer Larry Quinn to work on reuse projects for the current Children's Hospital buildings and campus. Quinn is a business partner of Kaleida chairman Gerald Lippes. As with the Peace Bridge, there's more money in more places at play than you and I will ever know about, and some individuals stand to make a lot of it if things fall out one way rather than another.
Kaleida's White Mother
There has been a lot of talk back and forth and press release salvos, but Children's Hospital war racheted up a big notch on February 26 when Kaleida ran a $15,000 ad in section A of the Buffalo News for 26 February. The top half of the ad depicted a white woman with a white baby and large letters saying "This is Children's Hospital." To the right and below that, in the same size type, is "Not this." The "this," shown in a small picture below that, is Children's Hospital.
"One important observation about the Kaleida ad," noted Dr. Bradley Fuhrman, chief of Pediatric Critical Care at Children's Hospital and Professor of Pediatrics at UB. "It leads off with 'This is Children's Hospital' and a picture of mother and child, both perfect, Caucasian, the infant swaddled in layers of blankets. This betrays Kaleida's vision for Children's. The picture is perfect for a middle-class, suburban, low-risk maternity ad. We serve a high risk, multiracial, infant and child population – regardless of social and economic background – with complex medical and surgical illness, largely in an acute care setting. Kaleida wants to appeal to (and cherry-pick) a well-insured, easily treated, low-cost populace."
The only hospital in Kaleida that's a substantial moneymaker is Millard Fillmore-Suburban. Little surprise there: nearly all of its patients have good jobs or enough private money to pay well for health care. Perhaps Kaleida is starting to worry that if Children's manages to secede from the union then Gates Suburban will do it next.
Different Languages, Different Agendas
You listen to the rhetoric on both sides and quickly realize they're talking about completely different subjects in languages that cannot possibly translate. Kaleida officials seem concerned only with Kaleida's bottom line, which grows redder by the day (projected $100 million more loss this year, moving the four-year total to $200 million). All the logic, all the rhetoric is draped around that single concern. Nothing I've seen from the Hunter Report says anything about the quality of health care (though there may be health care comments in the part Kaleida refuses to make public).
The physicians at Children's, even the angriest and bitterest among them, focus on the quality of pediatric health care. They insist that it makes medical and financial sense to keep Children's exactly where it is, and to terminate the increasingly bitter relationship with Kaleida Health.
Kaleida officials say they want to issue a final determination on the fate of Children's Hospital before the Ides of March. The doctors ask, Why the rush to judgment? Why make a decision that will have so great an impact on the community with no opportunity for the public to read and hear the evidence or contribute to the conversation? Why won't they even consider alternatives?
Good questions. Which nobody at Kaleida seems trying to answer.
Some links of interest:
You can see Kaleida's presentation of its position and a lot of recent Kaleida press releases by going to http://www.chob.edu.index1.asp. Perhaps the most interesting link on the page takes you to the small portion of the Hunter Group report that they've been willing to make public. Click on the line that says "Recommendations provided by the Hunter Group." You'll get a box asking for a password, which I can't give you because I don't have it. But if you click on the "read only" box in that same frame, the 511kb Word file will download anyway. A Googol search for "Kaleida Health" takes you to the same page, only it's got a Kaleida rather than Children's url. They're pushing this message everywhere they can.
Six photographs are linked across the top of Kaleida's welcome page (http://www.kaleidahealth.org/welcome.asp). No adult patients appear in any of them. Nine of the people depicted are, presumably, Kaleida staff. Only two show what might be patients, both of them infants. In one, a white two- or three-year-old wearing a football helmet seems to be getting some kind of dexterity instruction from a friendly grey-haired therapist. In the other, a smiling and very healthy-looking tan one-year-old is shifting from a sitting position to a crawl; no one else is in that photo and there is nothing medical in it. It's the kind of photograph you have taken by a portrait photographer to mail to the family or put in an ad for the most comfortable diapers there ever were.
One thing you can't find on the Kaledia web site is the name of anybody in charge of anything. If you go to the page titled "Administration" – http://www.kaleidahealth.org/gen_info/headquarters/admin.html – you find a header, but nothing else. The page is blank. Make of that you will.
You can find out more about the history of the merger and the current imbroglio by following the links on the page maintained by Women and Children First, which is the organization set up by nearly all the Children's Hospital physicians and their friends: http://www.savechildrens.org/.
New York Assemblyman Sam Hoyt has consistently been outspoken about the need to keep Children's where it is unless there is substantial evidence that its patients would be better served elsewhere. He stated his position in a Buffalo News "My Turn" column a few days ago: http://www.buffalonews.com/editorial/20020227/1028395.asp.
I've written seven earlier articles on Kaleida and Children's. There are all on line at http://csac.buffalo.edu/healthurls.html.
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