D.C. Health Department To Take Over Indigent Care System From Financially Troubled Hospital System

The Washington, D.C. Department of Health will assume control of the D.C. Healthcare Alliance, the city's privatized indigent health care system, the Washington Post reports. According to James Buford, the city's health department director, Greater Southeast Community Hospital will be removed as the leader of the alliance for at least six months and possibly for years (Goldstein, Washington Post, 12/5). Greater Southeast, the primary facility for people in the system who require hospitalization or trauma care, filed for bankruptcy last month after its parent company, Doctors Community Healthcare, also filed for bankruptcy on Nov. 20. Doctors Community's filing followed the collapse of health care lender National Century Financial Enterprises on Nov. 18, which filed for Chapter 11 bankruptcy protection because it owed approximately $3.6 billion to bondholders, large money-management firms that buy bonds and other creditors. Doctors Community is the general contractor for the D.C. Healthcare Alliance (Kaiser Daily Health Policy Report, 12/3). Buford said, "I can't say that we were dissatisfied with Greater Southeast's performance. The action would not have been taken but for the situation with the bankruptcy. I think the department will pretty much continue the current operations and there will be no interruptions at all."

Plan 'Ill-Advised'?
Under the city's plan to restructure the indigent care system, Greater Southeast would become one of six hospitals in the system instead of the "flagship" facility as it is in the current system. Buford said that while the department does not have qualified employees to handle "complex" oversight tasks in the new system, he "voiced optimism" that short-term contract employees could be hired. The plan must be approved by U.S. Bankruptcy Judge S. Martin Teel, who is overseeing Doctors Community's reoganization; a hearing will be held Dec. 11. Ivan Walks, former city health department director, said the plan is "ill-advised" because the health department has never taken on such a role. "Given that history, I think it's reckless to give the health department a larger role. I don't see how they can do it," he added. However, Eugene Kinlow, a former member of the D.C. financial control board, said, "I really believe that the Department of Health can take over as the prime contractor much more quickly, without competition and in a seamless transition" (Washington Post, 12/5).