Sunday, October 12, 2008

Letter and Reply re LGH proper role


In your editorial on Lancaster oligarchy, you suggest that the amount of profit Lancaster General Hospital, a not-for-profit entity, routinely posts is more than needed for health care purposes and you suggest that they become philanthropists.

Why doesn't Lancaster General Hospital reduce its charges to its patients, across the board? Wouldn't that be the most constructive way to rein in the cost of healthcare to this community?

And if Lancaster General Hospital gouges its patients to such an extreme extent that they are posting profits in excess of $160 million, and can't build and extend their empire fast enough to use it all up, can they even be called "non-profit" any more?

And, while I am at it, if Lancaster General Hospital begins giving away vast amounts of money to charitable community causes, isn't it really "We the Patients"who are the true community philanthropists, since it is really our money?

If I overcharge someone for my services, then turn around and give a portion of my ill-gotten gains to the poor, that doesn't make me a philanthropist. It makes
me an unethical businessperson trying to salve my own conscience or make myself look like good!

NewsLanc published a series of article about the roots of LGH profitability based on research conducted by an analyst borrowed from a national organization. We received a certain amount of cooperation from LGH at the outset before they clammed up when they saw we were skillful in putting together the jigsaw puzzle.

Some of their profitability stems from efficiency. But much is due to the special circumstances of this local market and their dominant position in it.

Most of their revenue comes from third party sources - insurance companies and government. Lower rates would partially trickle down to those paying directly and through insurance programs since the programs' costs would be reduced. But, in general, there can be a good argument for LGH charging market rates similar to hospitals throughout the state.

LGH clearly does not need to spend $160 million a year, year after year, on expansion and upgrading. So what it can do is provide a larger ratio of its earning to subsidize worthwhile local causes. In its relatively meager giving (one of the lowest percentages in the state for hospitals), LGH prioritizing public health efforts. Where it to re-think its philanthropic responsibilities, it would be able to do much more for current recipients and expand the scope of its philanthropy to include certain types of educational activities such as schools and libraries.

God bless the Steinman family for all the wonderful things they did during the last century. But with the print media moving to the Internet, the Steinman foundation is unlikely to play so large a role for the betterment of our community.

LGH has no need to try to profit through questionable projects at the public expense. Also it is an institution of highly qualified, sophisticated individuals. Its ethos is consistent with service to the community.

Therefore, NewsLanc encourages LGH to make use of its extraordinary prosperity to assume two roles: Expand the amount and scope of its subsidies to important community activities; and also provide an altruistic anchor against the schemes of those who despite incompetency and sometimes through greed and by bullying have seized the business leadership of our community.