Health Care Knows No Borders

: If medical centers align across a state line to elevate patient care and maximize efficiencies, what, exactly, is the downside?

By Dennis Boone

My Dad spent his boyhood in the central Kansas railroad town of Herington, a thriving burg at the time, with a population of about 4,500 in the 1930 census. When the uncle who raised him died in 1971, the town’s population had fallen by a third from that peak. Today, it’s less than half its zenith.

Demographic destiny underpinned the decision last fall to close the town’s hospital, consigning folks in Herington to care delivered 31 miles away at the larger cross-county hospital in Abilene. Just keep those numbers in mind for a minute because they’re relevant to current discussions in Kansas City about who should be allowed to provide hospital services, and for whom, and where.

But first, some background: Last October, The University of Kansas Health System and Liberty Hospital announced a partnership that would extend the much larger Kansas medical center’s service lines to the northeastern suburb on the Missouri side.

If anyone out there thought the divisions underpinning our early 21st-century economic development Border War had completely dissipated, all it took was a single news release from 3900 Rainbow to awaken the Kraken. Opposition on the Missouri side quickly assumed legislative proportions, with the pre-filing of a bill in the General Assembly to block the union. Kansas lawmakers, too, expressed chagrin.

The objections, on policy grounds, make some sense: The KU Health System, while an independent health authority, is governed by a board with a majority of members appointed by the governor of Kansas. Liberty Hospital is a municipal entity owned by taxpayers on the Missouri side. KU Health receives no Kansas taxpayer support.

Kansas Senate President Ty Masterson made public statements suggesting that KU Health could do more to benefit the public weal by paying attention to struggling hospitals in rural Kansas rather than starting new ventures across the state line. The issue of whether a public health authority formed to serve the entire state of Kansas should be crossing state lines makes for a valid policy discussion. It will be interesting to hear that play out. It’d be nice if the arguments were more than just parochial in nature.

The fact is, TUKHS is the biggest single facility in Kansas City hospital services, with nearly 1,000 licensed beds at the main medical campus—and nearly 1,500 overall, following the recent merger with Olathe Health. No other single institution has as many as 600 beds, though HCA Midwest Health’s six hospitals combined come close to KU Health’s total. And Saint Luke’s, at nearly 950 across four facilities, places third.

Those three behemoths account for more than half this marketplace’s staffed beds, nearly 60 percent of all patient admissions, and more than two-thirds of all hospital revenues. This, folks, is no struggling rural market.

All of which brings us back to Herington Hospital. People who lived there long ago made peace with the lack of many big-city amenities, as well as big-city pathologies. Now, they must travel the 31 miles to Abilene, a distance not appreciably farther than the space between Liberty Hospital and the KU Health System’s front door. (Which likely wouldn’t be traversed in any case, as folks in Liberty would have immediate access to more services.)

Conditions in rural Kansas are driven by demographics; those behind the Liberty-KU Health deal are driven by efforts to balance costs while providing higher levels of service.

And there, the terms of the debate favor Bob Page and Raghu Adiga, CEOs of KU Health and Liberty. Over the run from 2019 to 2022, KU Health’s revenues popped nearly 50 percent—from $7.9 billion to more than $12 billion (including the pandemic year that reputedly crushed hospital revenues nationwide). Simply put, that’s financial muscle that no other hospital can bring to Liberty, which announced last year that it was looking to partner with a larger entity to scale its service offerings.

If we’re truly focused on the welfare of the general population, this deal goes through unmolested. Every other consideration is high-octane parochialism. The respective legislatures in each state should stand down on this one.

If it’s any consolation to concerned lawmakers, KU Health attempted to partner with a couple of out-of-market hospitals in 2016, forming alliances with HaysMed and its Larned operation. Within five years, that alliance died; the institutions determined that serving the interests of their respective patient bases didn’t neatly fit into a unified structure.

Maybe the same happens with the Liberty deal. Maybe it doesn’t. But better care, at the lowest possible cost, should be the goal.

It’s long past time to take a shovel to the Border War in all its formulations. Do the deal.

Leave a Reply

Your email address will not be published. Required fields are marked *