Welcome to the Business Journal Archives
Search for articles below, or continue to the all new BusinessJournalDaily.com now.
Search
AFT Questions Hedge Fund's Role in CHS/HMA Deal
YOUNGSTOWN, Ohio – The president of the national union that represents registered nurses at Northside Medical Center speculated Monday that the unwillingness of the hospital's owner, Community Health Systems Inc., to strike a deal with the RNs stems from a “conflict of interest” involving CHS and a hospital chain it wants to purchase.
Meeting with reporters Monday following a press event about the relaunch of the Affordable Care Act website, Randi Weingarten, president of the American Federation of Teachers, said the conflict stems from a New York-based hedge fund, Glenview Capital Management LLC. Glenview has what she characterized as a “controlling interest” in both Tennessee-based CHS, which owns Northside’s patent company, ValleyCare of Ohio, and Health Management Associates Inc., a Florida-based firm operating 71 hospitals in 15 states.
The merger, scheduled to close during the first quarter, would give the combined company 206 hospitals in 29 states.
The Northside RNs, represented by the Youngstown General Duty Nurses Association, have been without a contract since their most recent agreement expired in July 2012. No talks have taken place since a one-day strike and subsequent lockout in September and none are scheduled, said Eric Williams, YGDNA president. The union has rejected offers from Northside management over issues including staffing and what he terms “nurse rationing.”
More than 60 nurses have left Northside following the walkout and the number continues to grow, Williams asserted. “These are intolerable working conditions for nurses,” he added.
“We didn’t understand why anyone … would belittle the nurses of this city and a community hospital like Northisde that has for so long had a reputation for excellence in care,” Weingarten said. “Why are they trying to crash a hospital and trying to crash the great quality of care that this hospital has long been known for?” Through its investigation, ATF, which YGDNA’s parent union, the Ohio Nurses Association, affiliated with earlier this year, discovered Glenview Capital’s interest in both CHS and HMA.
“What that means is rather than focusing on how to create good health care in this city and actually listening to the nurses who have been part of Youngstown longer than anybody can remember … instead they’re looking to have a reckless purchase and focus on their short term-profits,” Weingarten said. “That’s part of the reason we think that they refuse to do a contract that simply says put the career salary schedule into the contract.”
Glenview, in a Nov. 13 news release announcing its intention to vote in support of the CHS-HMA deal, acknowledged it is HMA’s largest shareholder with 14.5% of the company’s common stock through affiliated investment funds, and is also CHS’ largest shareholder.
“We could be wrong. There could not be the self-dealing that we think is going on here. There may not be this reckless, short-term attempt to try to take a lot of money out of both of these places from this hedge fund,” Weingarten said.
AFT, which represents just 2,000 CHS employees and has “substantial shareholder interest” in both CHS and HMA though its pension funds, planned to send a letter today to CHS to ask about the transaction.
Trish Hrina, vice president of marketing and public relations for ValleyCare, said she did not have a statement this morning regarding Weingarten's assertion.
The AFT official lamented that she had to address the topic on a day when she came to Youngstown to discuss the Affordable Care Act and the federal government “turning the corner” on fixing its HealthCare.gov website.
State Rep. Robert Hagan, D-58 Youngstown, was among the local and state officials who praised the Affordable Care Act. While the problems experienced since the website’s launch Oct 1 can’t be ignored, the bigger problem is the millions of people who lacked health coverage because of pre-existing conditions and other issues, Hagan said. He logged onto the site that morning and had little difficulty navigating the revamped website, he reported.
Youngstown Mayor-elect John McNally also reported that he experimented with the site Monday morning.
“I will tell you when you go on, you have to be prepared,” McNally said. “You have to do a little homework.” The only difficulty he encountered was his own fault, such as when he misspelled his wife’s name, a confession that drew laughter from the audience.
“When you’re misspelling your wife’s name after 15 years, you’ve got some problems,” McNally remarked.
Copyright The Business Journal, Youngstown, Ohio.
CLICK HERE to subscribe to our free daily email headlines and to our twice-monthly print edition.