Board criticizes Carson-Tahoe's imaging practices

Carson Tahoe Regional Medical Center and Hometown Health were criticized Tuesday for new contracts that prohibit the state benefits plan from covering workers who go elsewhere for medical imaging services.

Great Basin Imaging director David Landis said if allowed, that contract would put them out of business. And he said the reason Carson-Tahoe is doing it is because Great Basin is taking too much of their business.

"When you have a hospital monopoly, you have a big club and I can tell you if this continues, Great Basin Imaging will be driven out of business," he said.

Several patients said they don't want to change providers when they are happy with Great Basin's services.

Ed Epperson, CEO at Carson-Tahoe, told the board the old agreement with Hometown Health was "the biggest volume discount on prices we've ever given." He said, however, there has been a significant decline in business, forcing the hospital to look for ways to strengthen its bottom line.

Epperson also charged that Great Basin has, in the past, enjoyed exclusive agreements including with Carson-Tahoe when the company provided its radiology services.

"Great Basin thinks exclusivity is unfair unless they have it themselves," he said.

Board members, however, didn't seem to like the idea.

"I'm not sure how this actually benefits our participants," said board member Julia Teska. She charged the exclusive contract is "artificially funneling out-patients to Carson-Tahoe."

"This kind of sounds like we're getting strong-armed just a little bit."

Ty Windfeldt of Hometown Health told the board the new contract will save the public employee benefit plan $1.6 million a year, according to their calculations. Asked to expand on his comments after the hearing, Windfeldt admitted that amount isn't a direct savings but simply the difference between Carson-Tahoe's initial contract offer and the final deal reached after extensive negotiations.

Epperson also described the contract as revenue neutral to the hospital.

Jacque Ewing-Taylor said since the contract covers all in-patient and out-patient services, "in theory we could end up paying more for imaging but less for other things."

Windfeldt said that was possible.

He also let the board know that imaging services, which are often very profitable, aren't the only place Carson-Tahoe is seeking exclusivity that cuts out competition. He said physical therapy is also included in the contract as an exclusive service now.

Chairman Ron Swirczek said exclusive contracts are the wrong way to go; that patients get better service for less money when there is health competition.

Landis said he had called nearly 60 Carson City doctors about the contract and that, "not one of them thought eliminating Great Basin Imaging was a good idea."

And while Windfeldt said the exclusivity clause just developed during negotiations, Landis said when he asked how it happened, "Hometown Health said it was a requirement of Carson-Tahoe."

Epperson said it was necessary: "We feel we need to remain in business."

"Is it fair for patients to give up choice in order for Carson-Tahoe to meet their business plan?" Landis asked.

Finally, Swirczek won a promise that Carson-Tahoe, Hometown Health and Great Basin representatives would sit down and try work out some deal that lets Great Basin patients stay with the doctors and technicians they know and like. They will try to have an answer in time for the board's Aug. 1 meeting.

This isn't the first time the state benefits program has had an issue with Carson-Tahoe. Until 2002, the state had a direct contract with the hospital, which didn't want to give the discounts demanded by Hometown Health. Eventually, Epperson and his staff signed a letter of agreement with Hometown Health, which they terminated in March 2007, in part because they felt Hometown Health wasn't complying with the exclusivity that letter was supposed to give them in certain areas.

The new four-year agreement was reached this March.