Bon Secours proposes selling some properties 

Posted: 2:20 pm Fri, November 13, 2009
By Danielle Ulman
Daily Record Business Writer

Bon Secours Baltimore Health System plans to keep implementing cost-cutting measures, including selling some of its properties, but it will also need continued state support to achieve financial stability, the hospital said in a report.

Bon Secours, part of a Catholic organization, asked the state for financial assistance this year. The state said it would provide the $5 million only after reviewing a report from the West Baltimore hospital on its plans for improving its financial performance and delivery of health care to the underserved community.

The hospital said Baltimore City Community College is the prospective buyer for the Liberty Medical Center, a substance abuse and mental health facility. BCCC has agreed to lease space to the hospital to keep behavioral and substance abuse programs in the neighborhood.

An agreement is being negotiated to sell the Washington Village Community Medical Center. Bon Secours expects annual savings of $850,000 following the closing of the sales, which are projected for July.

“The issue of Bon Secours’ survival has been a matter of some concern for some time. I don’t think that they would divest themselves of certain assets if they didn’t think this was going to help them stay open,” said Andrew L. Solberg, a Maryland health care consultant, who has not worked with Bon Secours.

“I don’t know whether it will be enough, but I certainly hope so,” he said.

John Colmers, secretary of the Maryland Department of Health and Mental Hygiene, received the report last week, according to Bon Secours. The state has 45 days to review the report to decide if it will grant the hospital the $5 million.

Bon Secours faces systemic issues in West Baltimore, where the health care system is not sufficient to handle primary care, specialty care and prevention. More than 40 percent of the people in the community are out of work, and they rank in the least healthy third of city residents.

Bon Secours said it will work with the community to develop a 10-year, primary-care focused strategy. The hospital will work to address health indicators like nutrition, employment, income, education, health care services and living and working conditions.

The plan will include collaboration among neighborhood health care providers and community agencies, expansion of services to the community and links between inpatient acute care and urgent care services.

Bon Secours has run a deficit for nine of the last 10 years. In the five fiscal years ending August 31, 2008, it lost a total of $33 million. But the hospital has worked over the last year to reduce its deficit, losing $9.5 million in fiscal 2009. Steps have been taken to cut jobs and implement new operational procedures.

It is projecting a loss of $6.9 million in fiscal 2010. The loss would be $1.9 million with the state’s help.

Maryland has worked to improve the hospital’s finances through increased inpatient admissions and better rates. An agreement with the Department of Public Safety and Correctional Services made Bon Secours the primary site for inmates to receive inpatient and outpatient services.

The Health Services Cost Review Commission, which sets the rates Maryland hospitals can charge for services, approved $7.3 million in supplemental rates for the hospital. Bon Secours has asked the state to rethink the HSCRC’s rate-setting methodology to include more physician services.

Bon Secours has a high level of uninsured or Medicaid patients. Many of the private practice physicians that serve the hospital cannot make enough money from reimbursements so they need subsidies from the hospital. Direct subsidies to those physicians were $13.4 million in fiscal 2009.