The story came as a shock. On May 2 the Birmingham News reported that Baptist Health System Inc. was considering selling its facilities to a for-profit hospital company.
At first the story sounded like a false report. Only days earlier representatives of Baptist Health System (BHS) had been in this office, and many other offices in the Birmingham area, seeking support for a major expansion program on its Montclair campus. That a leading corporation would so radically alter its course from expansion to selling in such a short period of time seemed too drastic to be true.
But the news report was true. In fact, BHS, the largest health care network in Alabama, has been exploring options, including the sale of the system, since at least January. On June 18, BHS trustees will meet to decide the future of the system. What they decide will impact health care across the central and northern parts of our state. Some believe the decision could influence the action of nonprofit hospitals across Alabama.
BHS is one of the state’s largest employers with 9,000 employees. It operates 10 hospitals with 2,100 total beds. BHS operates nine senior housing facilities, one retirement center, 10 fitness facilities and home health care in a 10-county region.
Even though BHS is an entity of the Birmingham Baptist Association and has been since 1922, its reach goes far beyond the association’s geographical bounds.
BHS trustees wrestle with two major issues. The most important is whether the mission of the system is still valid. The mission statement says, “As a witness to the love of God revealed through Jesus Christ, [the BHS] is committed to ministry that enhances the health, dignity and wholeness of those we serve through integrity, compassion, advocacy, resourcefulness and excellence.”
Trustees must decide if it is still valid to have a health care delivery system where leadership affirms and validates by its actions that caring for sick people is a witness to the love of God revealed through Jesus Christ. Where leadership takes such a stance, an organizational culture develops that sees care as a witness to the love of God, and that culture permeates all the way through the front line service providers.
An organization that places profit as its highest motive will have a different culture, most likely one focused on the bottom financial line. Obviously, the reason an organization exists makes a difference in the types and quality of services provided.
The second question is a practical question. Are there sufficient resources to accomplish the mission? The major resource, in this case, is money. Hospitals everywhere are in trouble because of the Balanced Budget Act, which cut the Medicare reimbursements hospitals receive.
BHS’s contract with Blue Cross-Blue Shield also is a problem, officials said. Alabama’s dominant health insurance company reimburses other Birmingham area hospitals more for the same procedures than it pays Baptist hospitals. Other Health Maintenance Organization agreements have worked out poorly for the Baptist system. And there have been other long-term problems along the way.
Two years ago Baptist Health Services, Inc., in Montgomery, an entity of the Montgomery Baptist Association, found itself in a financial crisis, operating about $30 million in the red. This year the red ink has been reduced to about $2 million. The change of financial direction was not without pain. One of four hospitals the Montgomery group purchased in the mid-1990s had to be closed. Other difficult management decisions had to be made. More challenges await.
But today trustees of the Montgomery group see a future for their organization. They never considered selling or taking the health care ministry another direction. They made the decisions necessary to preserve the mission for which they existed.
Whether such an approach can work for the Birmingham system, no one knows. What is known is that the two groups are talking to see if there is anyway of working together to save the mission of BHS. Birmingham officials vowed “to leave no stone unturned” in that pursuit.
Financial problems are not unique to BHS. Reportedly, 70 percent of Alabama hospitals are losing money. But 30 percent are operating in a positive fashion. The question is whether BHS can move into that 30 percent.
Other Baptist health organizations across the nation have faced financial problems. Some sold. Others resorted to an array of creative solutions short of selling out in order to preserve the mission and purpose of their ministries.
One can only wonder how a for-profit hospital company, which takes money out of communities it serves to benefit stockholders, can operate Alabama’s largest health care network more cost effectively than a nonprofit organization can. Obviously, if the bidding companies did not see profit potential, they would not be offering hundreds of millions of dollars to buy the Baptist system.
It appears the solution to BHS’s financial situation receiving the most discussion is to sell the system and create a Baptist Health System Foundation funded by the proceeds from the sale. The foundation would become a funding source for missions work in Alabama and around the world, promoters say. Some of the projects would be medically related to keep the emphasis of BHS, they noted.
The foundation option has been used by other Baptist hospital groups. It has advantages. Certainly, missions is important. That makes the option attractive. But missions is one ministry among many. That is why the purpose question is so vital. If the original purpose is still valid, then the fiduciary responsibility of trustees is to preserve and extend that mission.
If the original purpose is no longer a top priority or no longer possible because of insufficient resources, then trustees can take the organization a different way. However, other options exist between the poles of continuing business as usual for BHS and selling the entire system. The experience of other Baptist hospitals clearly demonstrates that.
Still, BHS trustees may decide selling the company is their best option. They may decide it is better to capture the value of current assets rather than risk what those assets could be worth five years from now. Even if that is the best decision possible, it will be a tragedy for Baptist witness, for Baptist ministry and for Baptist presence in central and north Alabama.
We believe it is still valid to have a health care delivery system where leadership affirms and validates by its actions that caring for sick people is a witness to the love of God revealed through Jesus Christ. We hope any decision to lessen the importance of that mission will be made only after every other alternative has been carefully examined.
Alabama Baptists should be praying for the 23 men and women charged with making this fateful decision. Their conclusion will affect the quality of health care in much of Alabama as well as the reach of Baptist witness.
Share with others: