Talks ‘back on track’ [Journal Inquirer]

January 21, 2015

By Mike Savino
Journal Inquirer
Posted: Tuesday, January 20, 2015 12:03 pm

Legislators say they are pleased to see Gov. Dannel P. Malloy reach out to Tenet Healthcare Corp. in an attempt to renew its efforts to buy five Connecticut hospitals, even as the governor awaits a response from the for-profit company.

Lawmakers say they are hopeful Malloy’s administration can help broker a deal with Tenet, with many blaming the Office of Health Care Access for proposing strict conditions as part of Tenet’s bid to purchase Waterbury Hospital and scaring away the company.

“We realize in Connecticut that, I think, we overplayed our hand now,” state Rep. David Alexander, D-Enfield and member of the legislature’s Public Safety Committee, said.

Alexander voiced overall opposition to OHCA’s standards, and said Tenet has the upper hand now that top lawmakers and Malloy have reached out to Tenet.

Tenet withdrew its bid in early December to buy Waterbury, St. Mary’s, and Bristol hospitals, as well as Eastern Connecticut Health Network’s Manchester Memorial and Rockville General hospitals.

Tenet has blamed OHCA for its decision, and Alexander isn’t the only legislator upset with the regulatory agency.

State Sen. Tony Guglielmo, R-Stafford, said he “didn’t understand how something so important like that could break down.”

“There didn’t seem to be any other options — it wasn’t like we had an option 2 or 3,” he said, adding he hasn’t heard of another suitor for any of the five hospitals Tenet wanted to purchase.

He specifically pointed to a requirement that Tenet would need approval from an independent monitor before making any changes to its business.

Malloy had been critical of Tenet in the days after its withdrawal, saying the decision meant the state no longer could negotiate the conditions.

But Senate Minority Leader Leonard Fasano, who reached out to Tenet officials with the hope of getting them back to the table, said last week that talks are “back on track.”

Both he and Senate President Pro Tem Martin M. Looney met with Tenet Senior Vice President Trip Pilgrim, and the discussion led to Malloy sending a letter on Jan. 12 to company CEO Trevor Fetter.

In the letter, Malloy encouraged Pilgrim to have a company representative begin discussions with Mark Ojakian, the governor’s chief of staff, with the goal of reaching “a settlement that is beneficial to both sides.”

A Malloy spokesman said today that Tenet has not yet responded to the letter.

Malloy said Jan. 14 that “there have been discussions back and forth really almost from day one,” but also maintained his position that it was Tenet who killed the deal by withdrawing its application instead of negotiating.

“Tenet threw a wet blanket on it when they withdrew their application, they’ve got to decide whether they want to come back or not,” he said.

He also responded to reports that Pilgrim wanted a phone call directly from the governor by saying that he “sent a letter,” but would welcome a call.

Looney, D-New Haven, agreed with Malloy, saying that Tenet’s withdrawal stalled negotiations. But he also said he understood some of Tenet’s concerns.

He said that OHCA’s conditions were similar to those imposed on Sharon Hospital, which went from not-for-profit to for-profit, but said they would have a different impact on Tenet because of the company’s size.

Looney specifically said Tenet was concerned about having to share its strategic plan with OHCA.

Some lawmakers, including Alexander, said they wanted to see the legislature play more of a role in the process.

“The legislature’s really been shut off from this, and that really frustrates me,” he said, adding that Tenet’s deal has major implications for the whole state.

He said that the state could hurt patients if it doesn’t retain enough control, but being too burdensome would make Connecticut seem unfriendly to other health care providers.

But he also agreed with Fasano, R-North Haven, and Guglielmo, saying he wanted to see the state work something out with Tenet because of concern about the future of the five nonprofit hospitals.

Looney also said he was happy to see the state attempt to keep talks alive, but didn’t agree the hospitals would be left helpless if Tenet ultimately walks away for good.

“The marketplace seems to be evolving so quick that it’s hard to say who might be a player two months from now or three months from now,” Looney said. “We really can’t even speculate at this point.”

State Rep. Claire Janowski, D-Vernon, though, said the state does have options for helping the hospital, including restoring a pool that provides aid to cover the costs of caring for the uninsured.

Despite the gains made under the Affordable Care Act, some residents still haven’t purchased insurance as required and undocumented residents can’t do so, she said.

“Getting Tenet back to the table is not the panacea that everyone thinks it is,” Janowski said. “There are a number of problems for hospitals, whether they are going to be for-profit or not-for-profit, and I think we need to take a re-look at what we have done.”