Hospital Show Down in the Catskills
Physician group practice pulls out of rural nonprofit hospital, criticizing its quality—but hospital CEO says the issue is control.
Catskill Regional Medical Center (EIN 14-6049030 Form 990) in Sullivan County, New York is laying off staff after the departure of physicians from the for-profit Crystal Run Healthcare. Crystal Run founder and manager Dr. Hal Teitelbaum says that Catskill Regional is lacking in quality controls. The practice is sending its patients to the larger (but farther away) Orange Regional Medical Center (EIN 14-1364536 Form 990) in Middletown.
Crystal Run Healthcare is not a typical practice. Its original location in Middletown now includes an outpatient hospital and testing facilities (CT scan, echocardiography, endoscopy, MRI, nuclear medicine, ultrasound) with general practice doctors and specialists in a 72,000-square-foot building. It now has five sites in Orange and two in Sullivan County. It is in the process of increasing the practice to 120 doctors. (Dr. Teitlelbaum also holds an executive MBA from Columbia.) ("An Expanding Empire of Health Care" from the Times Herald-Record in Middletown)
In Middletown, the practice now attracts about $10 million of year of outpatient services that used to be supplied by Orange Regional. The Form 990 of Catskill Regional includes its full financial statement, which informs us that 53% of its fee income is from Medicare and 30% is from Medicaid. The hospital ran a deficit of about $300,000 on income of $98 million.
Two years ago, CRHC opened a facility in Sullivan County, first in Rock Hill, about 12 miles away, but soon in down the road in LIberty. Catskill Regional started making it more difficult for its doctors to join the staff ("Countdown for Control" from the Times Herald-Record). CEO Art Brien of Catskill regional claimed it was unrelated to CRHC, but Dr. Teitelbaum claimed that it was to keep his doctors out of the decision making process, to protect doctors at Catskill Regional who had financial relationships and exclusive contracts there.
Then CHRC complaints about quality of care began.
So it might be about quality control, or it might just be about control, period. What it also shows is the vulnerability of unaffiliated rural hospitals—either vulnerability to entrenched bad management or vulnerability to for-profits that want to steal away profitable bits of business, depending on your point of view.
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