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News-Sentinel.com Your Town. Your Voice.

Corporate resignations pose greatest threat yet to Lutheran owners

When local corporate begin to distance themselves from Lutheran Health Network, and they have, its out-of-town owners should pay attention. (File photo by Kevin Leininger of The News-Sentinel.)
When local corporate begin to distance themselves from Lutheran Health Network, and they have, its out-of-town owners should pay attention. (File photo by Kevin Leininger of The News-Sentinel.)
Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.The Associated Press
Saturday, July 15, 2017 12:01 am

Could the turmoil swirling around Lutheran Health Network lead some current and former doctors and employees to pursue creation of a new hospital in Fort Wayne?

I've mentioned that possibility in passing a couple times in recent weeks but didn't make more of it because I still consider it a long shot, but the very vocal resignation of two prominent business leaders from the boards of the network and Lutheran Hospital indicates how quickly the unlikely could evolve into the possible.

Lutheran's parent corporation, Tennessee-based Community Health Systems, has fired executives and doctors following its rejection of a locally led group's $2.4 billion buyout bid, and several others have resigned. But doctors and administrators can be replaced, and in some cases already have been. It's far harder to find substitutes for public confidence, good will and the business they create — and that is precisely the signal sent by the resignations of Sweetwater Sound Founder Chuck Surack and Kelley Automotive Group head Tom Kelley.

Surack, Kelley and other business leaders who have been less vocal but no less concerned about CHS' allegedly bottom line-driven business practices are more than respected and influential business and community leaders: They directly control health care for thousands of employees, many of whom are now served by LHN.

"I have 350 employees; Chuck has 1,000," Kelley told me Friday. "Fort Wayne needs competition, and I don't want to see Lutheran become a 'C' hospital." Neither man said they plan any immediate move away from LHN, but both indicated it's a possibility if things continue to deteriorate.

And deteriorate they will unless CHS drops what Kelley called its "My way or the highway" management style. LHN reportedly turned a $300 million profit last year while CHS showed a $1.7 billion loss, and while it's not unusual for corporations to prop up underperforming assets by diverting funds from profit centers, neither should it be considered treasonous for institutions and people negatively affected by such subsidies to object — especially when livelihoods and lives are at stake.

But according to numerous doctors, that's precisely what has been happening, resulting in the threatened lawsuit-induced dissolution of Fort Wayne Physicians LLC, which led the buyout attempt.

Surack and Kelley made it clear they have had far more than a business relationship with Lutheran. In his resignation letter, Surack said he has "incredible respect and fondness for the many amazing doctors, nurses, and other great staff," and in a separate email to board members said "I respect and love you all so much . . . I remain loyal and available to you all."

Added Kelley: "It tears my heart out. It's like the neutron bomb: They want to throw out the people and save the buildings."

No doubt CHS has reasons for its tactics. After all, you can't blame a company for not selling a key asset at a price it claims is $1 billion below market value. I can't tell you what those reasons are because requests for interviews with corporate executives have so far proven fruitless, and that indicates they don't really care what you think.

But if CHS really is as bottom-line driven as its critics claim, the possibility that key local business leaders may take their employee health policies elsewhere should get their attention. There is already another major health-care provider in town, of course, but not even Parkview Health has unlimited capacity. If Lutheran continues to lose well-known and respected doctors and executives, and if a start-up competitor could attract a sufficient base of employee health business and key local staff, such a prospect could begin to make financial sense.

Or maybe CHS will simply reconsider its unwillingness to sell LHN — before the turmoil diminishes its value.

A good start

The three Allen County Commissioners' approval of a policy that will require them to document their work hours and activities was long overdue, but welcome nevertheless. When there are credible allegations that certain public officials are not putting in the time and effort legitimately expected of them, other officials must respond — or risk further alienating the taxpaying public.

To be sure, compliance will still at least partially be based on the honor system, with records submitted hard to substantiate in some cases. But the commissioners' unanimous willingness to subject themselves to added scrutiny is commendable, and should be embraced by other elected officials.

Yes, such officials ultimately answer to the public. But information is required in order to cast an intelligent vote, and this policy will help provide it.  

This column is the commentary of the writer and does not necessarily reflect the views or opinions of The News-Sentinel. Email Kevin Leininger at kleininger@news-sentinel.com or call him at 461-8355.

 

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