Legislature may be asked to call vote on Jeff hospitals

With the Jefferson Parish Council embroiled in a months-long battle over the fate of the parish’s two public hospitals, a West Bank lawmaker has taken the first step toward possibly reinstating a requirement that the parish get voters’ approval before privatizing the hospitals.

A bill prefiled by state Rep. Pat Connick, R-Marrero, would require a public referendum before the parish could lease East Jefferson General Hospital and West Jefferson Medical Center to a private company. A second Connick bill would require that parish voters be allowed to weigh in only if the council decides to split the hospitals between two companies, a plan now being pushed by East Bank proponents of HCA.

The bills showed up on the Legislature’s website Wednesday, the same day the Parish Council had another acrimonious battle over the hospital leases, this time centering on proposals to select a consultant to review the proposals from HCA, Louisiana Children’s Medical Center and Ochsner Health System, and a move to disqualify HCA because the company pleaded guilty in 2000 to federal charges of bilking Medicaid and Medicare and agreed to a settlement over allegations of kickbacks.

Supporters of HCA prevailed over those favoring Children’s on both those issues, keeping the company in the running to run either or both hospitals.

The council also agreed to hire a Pennsylvania company to analyze the three applicants’ plans. That came over the objections of those supporting Children’s, who argued the chosen firm could be biased toward HCA, a national hospital chain.

Connick described his bills as placeholders filed to meet the deadline necessary to file and advertise measures dealing with specific parishes before the legislative session begins March 10. Whether he actually pushes the bills during the session will depend on how the selection process continues to play out, he said.

Connick said, however, that he’s been disappointed in what has happened since the Legislature last year removed the requirement that a hospital lease be approved by the public.

“We were advised ... last year that we needed to take the vote away from the people to avoid a big confrontation, and we did that,” he said. “Even though we did do that, what we have now is a big confrontation and a big mess. I think the public is concerned, and they should have a voice in what’s being done. Right now they don’t have a voice, but this may give them a voice down the road.”

As the boards of the two parish hospitals began whittling down the contenders for a lease last year, they urged the Legislature and the Parish Council to eliminate the need for the public to give their approval to leasing the medical centers. The vote to eliminate the referendum passed nearly unanimously in Baton Rouge, with Senate President John Alario, R-Westwego, casting the only dissenting vote in either house.

Connick said he does not have a preference on which company wins the lease and expressed concerns about each of the contenders. He also said he was concerned that requests he’s made to the council for more information on each company’s offer have not yielded any results.

Connick said concerns raised by residents about the disarray in the selection process factored into his decision to file the bills, and that he’s looking for more public input before deciding whether to move forward with them.

“The issue is not settled, and it should have been settled,” he said. “It’ll go back to giving people a voice, and that may be the best thing to do.”

The council, meanwhile, continued to battle over the hospital issue.

It voted 4-3 to move forward with the selection of Nemzoff and Co., of Pennsylvania, to review the lease proposals. Nemzoff was the only company to submit a proposal after the council voted last month to seek such a review.

The company’s services will cost the parish $125,000 plus expenses, according to its proposal, though the final contract will need to be negotiated and approved at a later meeting.

Councilmen Chris Roberts, Elton Lagasse and Ricky Templet, all proponents of leasing the hospitals to Children’s, voted against the selection.

Roberts, pointing to articles about previous work the Nemzoff firm did brokering deals to sell hospitals to companies including HCA, said he doubted the firm’s impartiality.

“Do I believe there is a potential conflict? Absolutely,” Roberts said. “When the Wall Street Journal recognizes you as an expert in selling nonprofit hospitals to for-profit companies, I don’t believe you are looking at this issue with the independence we all sought to have.”

Parish Attorney Deborah Foshee said, however, that the company has never worked for HCA and, based on what it has told parish officials, has no conflict of interest that would prevent its hiring.

Roberts also reiterated concerns about a comment in Nemzoff’s proposal that said there would be little functional difference between a lease and a sale, since a hospital rarely if ever returns to direct public control after a lease. That statement had raised concerns that the parish might need to send the decision to a referendum, which is required should it seek to sell the hospitals.

But Foshee said state law makes a clear distinction between a lease and a sale, provided the final agreement doesn’t give the winning company the ability to take ownership of the hospitals without council input.

The council also voted 4-3 against a measure sponsored by Templet that would have disqualified HCA from the competition based on a parish ordinance that allows companies to be thrown out of bid processes if they are convicted of crimes. In this case, that disqualification was not triggered because the selection process is not a typical bid process.

Templet, stressing that HCA’s 2000 guilty plea was attached to a $1.7 billion settlement with the government, said the ongoing corruption trial of New Orleans Mayor Ray Nagin and revelations of corruption under former Jefferson Parish President Aaron Broussard showed the need to disqualify HCA.

“This council and the administration have taken great strides to make sure we had transparency and non-corruption in parish government,” he said. “We shouldn’t do business with companies that have fraudulently used money from the public.”

Council members Ben Zahn, Cynthia Lee-Sheng and Paul Johnston, all supporters of splitting the hospitals between HCA and Children’s, voted against Templet’s proposal. They were joined by Councilman Mark Spears, who has not publicly stated his preferred outcome for the hospitals and who has pushed for hiring an outside expert.

Just before the vote, Templet took a dig at his fellow council members.

“If anyone wants to vote in favor of a company that’s pled guilty to bribery and kickbacks, let’s just say I’d find that surprising,” he said.

Zahn noted that many hospitals have had issues with Medicaid and Medicare billing — including, he said, both parish hospitals. He also said there is little practical difference between the civil actions in their cases and the criminal actions in the HCA case that Templet cited.

“To me a kickback is a kickback, whether it’s criminal or civil,” he said.