Is the Cleveland Clinic Killing Lakewood Hospital?

[Bill Call]

Last summer I noticed a kiosk advertisement for Lakewood Hospital on East 50th.

It is unlikely that patients coming from that area are covered by any other insurance other than medicare or medicade. Many would have no coverage of any kind. The Clinic know this they don't do anything by accident. Why are they trying to steer non-paying patients to Lakewood?
Their main facility is much closer to that area.

The Clinic is investing heavily, using its own money, to build full service medical facilities in the outlying suburbs. Such a facility would make a lot of sense here in Lakewood. Why won't they build one? Are they trying to steer paying customers to their other facilities? Clinic officials have been quoted as saying that those facilities are real money makers.

The Clinic used its own money to greatly expand Fairview Hospital. Yet they insisted the City sell City assets to pay for an expansion of Lakewood's emergency room. Why are they staving Lakewood Hospital of much need investment?

The Clinic is advertising Fairview Hospital in a broad range of media outlets. Lakewood is hardly mentioned. Why are they failing to market Lakewood Hospital?

Lakewood Hospital is a 125 million dollar a year business that pays one milion dollars a year in rent. Are they using the millions saved on rent to finance facilities outside of Lakewood?

Are these the actions of an organization commited to the future of Lakewood or committed to its destruction?

[Jim O'Bryan]

Bill


Let me play the Devil's Advocate to you, and maybe Richard Baker will come in with some of his reasons why they will not move.

Kiosk Ads - What was the kiosk? Sometimes bought in blocks. While I agree the placement seems odd, I think it even seems odder as a idea that would make the hospital have an explanation to move. Drive uninsured to Lakewood Hospital? I have to think there are easier ways.

Money Spent - They just dropped a bundle on improvements.

Long term - It would seem that Lakewood understanding how important Lakewood Hospital is, has bent over backwards to keep them involved in the city. Likewise key hospital personnel are almost at every function, and are very interested in pushing Lakewood ideas forward.

Fairview Hospital - The space to enlarge was easily obtained. Where we know Lakewood gets touchy, rightly so, when we offer up neighbors homes for parking, etc.

Density - Lakewood as we all know, "The most densely populated city between New York and Chicago." These would be mostly insured families(?) and aging population. Seems like a gold mine to me.

University Hospital - Let's be honest, IF they pulled, I would have to think University Hospitals would be here in a moment. I am pretty sure LH is on their radar screen for obvious reason.

As I am sure Richard Baker would back me on. The Lakewood Hospital got some greats deals from Lakewood. ANY bottom line orientated business would have been a fool to walk away from.

In full disclosure, The Lakewood Hospital is one of The Lakewood Observer's biggest supporters. They receive papers for the staff and patients. They have embraced the "Open/Civic Source" model knowing fullr well that their check provides ALL Lakewoodites a chance to see and join in this message, this board and the paper. This is from the only hospital in town, that really does not need to do this. I would say that is a commitment to the community. I would look at the Lakewood Businesses missing from the pages. 5th Largest paper in Northern Ohio, Almost twice the circulation of the second largest paper in Lakewood the PD and nearly 3 times that of Sun Papers! I would think that these are the buisnesses giving lip service to supporting the city. Bill you are accountant, you tell me what is the value of 17,000+ exposures/views for as little as $30.00? Then add in the public/civic pluses of helping a LAKEWOOD ONLY paper hit the street.

As far as the hospital, I am not saying I have any inside information, or that it might not happen. But from all angles outside of the 1 possibly misplaced ad that I am still trying to figure out what you were doing there?! All indications say it isn't happening.

I just can't see Fred DeGrandis coming to Lakewood to cut the ribbon on a hospital that he would close soon.




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[Tracy Jones]

I doubt that the Cleveland Clinic is "killing" Lakewood Hospital. Have you been inside recently to see all the renovations? Why bother with improvements if the Clinic has plans to "kill" Lakewood Hospital. Also, their Neuroscience Center includes the only JCAHO-designated Primary Stroke Center in the Westshore community, and is one of only a few community hospitals in the nation with a designated Neuro Intensive Care Unit. I don't see an organization trying to destroy the future of Lakewood here.

[Danielle Masters]

Several years ago I took one of my children to Lakewood hospital and it was a horrid experience, long story short they misdiagnosed my son and it nearly cost him his life. For a long time I had a negative view of Lakewood Hospital. Over the last couple of years I have seen major improvements and have heard from friends how wonderful the hospital is. Just this week we had the pleasure of visiting the ER. A autistic three year old, a head injuring and an ER usually wouldn't lead to a positive experience but I have to say it was fantastic. The staff was wonderful. They were quick and calm. They made my son feel very comfortable. We were in and out of the hospital in about an hour. I must say that with this experience I am definitely more confident in the hospital. It seems to me that the Clinic has made major investments in Lakewood Hospital. I can't imagine that they would close it. As for the kiosks, when you need surgery you don't necessarily go to the corner hospital. You look for a hospital that specializes in a certain area. I imagine that it was the kiosks are for, just to let people know what Lakewood Hospital is all about.

[Joan Roberts]

Mr. Call.

With just a little knowledge of advertising and a recently-gained understanding of the Cleveland Clinic, I can second Mr. O's comments and hopefully put your mind at ease.
Very seldom do advertisers have total control over where their ads are placed. You generally buy a package of bus cards, kiosks, billboards, etc. You can buy specific locations, but that costs more. I seriously doubt that it's the Clinic's intent to steer east side patients to Lakewood. It's far more likely that the kiosk ad you saw on E. 50th was a goof, like seeing a Mercedes dealer commercial in a wrestling show.
Also, what makes you think Medicaid patients are "non-paying"? They don't pay for it themselves necessarily, but trust me, when the Clinic treats a Medicaid patient, the Clinic gets paid. and quite often, not appreciably less than what some private insurers pay.
Jim is also correct about expansion. Lakewood Hospital, before and after the Clinic, has done a remarkable job given their space limitations. Will those limitations someday make LH an unprofitable center? Maybe, but always keep in mind that the Clinic does not have the power to "shut down" LH. It is owned by the city, and if the Clinic decides not to renew the operating agreement, the city is free to find another suitor.
Full disclosure: I have never received a dime from Cleveland Clinic or Lakewood Hospital, nor am I in awe of them, as I know some are. I know a few people who work for both, but they are hardly in decision-making capacities, nor do they have any effect on my finances. Various members of my family have been treated at LH, Fairview, Lutheran, and the main facility, and I have had both good and disappointing experiences.
Does this perspective help at all?

[Bill Call]

Jim:

Ads:

Over the last two weeks I have heard numerous radio ads about Fairview.
When is the last time you heard one about Lakewood Hospital?

Money spent:

The City is charging the Clinic $2 per square foot for its space. The space is worth at least $10 per square foot. Over the last fifteen years the City has subsidized the Clinic to the tune of 75 million dollars. They haven't spent any where near that on improvements. They did make the City sell City assets to help finance the improvements.

Does the Clinic ask Beachwood or Strongsville or Westlake to sell City assets to finance all the new construction in those Cities? How much of that 75 million dollar subsidy went to finance the Clinic's expansion in those cities?

Fairview:

It makes no business sense for the Clinic to have two hospitals so close together. It makes a lot of sense to keep Lakewood open only as a means to deny it to the University System. University would love to have it. After the Clinic neglects maintenance and further improvements how much will it be worth to University? The Clinics goal is to have an outdated facility at the end of its lease period.

Land: The Clinic buys plenty of land in Beachwood. Using their own money.

Observer:

Is the Clinic buying ad space or silence?

Joan:

I did not say the Clinic would close Lakewood Hospital. I said they are trying to kill it. How much of that 75 million dollar subsidy was spent in Lakewood? Why aren't they building a new medical building in Lakewood like they are building in Beachwood, Stongsville, Westlake, Lorain etc..

Why do they have one billion dollars of their own money to spend in Florida but demand Lakewood sell city assets to pay for improvements at Lakewood Hospital?

Thanks for responding to my posts. I don't learn much debating with myself.

[Jim O'Bryan]

Bill, Bill, Bill


Of course they are buying silence. Call me, there are a couple things I would love to tell you that I will not input here. Curse words you know. Buying my silence! I would expect that from someone that doesn't know me.

And as we found out with our meeting with the Fire Chief, the fire department is buying my silence too. Oh wait, after you were trolling for months, they sat and answered every question you asked them. No wait let's go a step farther The Chief asked us, no I take that back, encouraged us to pay for an audit of the department!!!!!!!!!!!!!!!!!!

Have you lost it? Or should I use common sense, and what I know and not put a disclaimer in there?

How on earth are attacks against any group positive until you have the facts!

OK - Now that I vented, let's go back and run your numbers which I believe are off, as someone else is writing the story on the lease, and sees it very different than you.

$2.00 a square foot. I actually think it is $2.10 a square foot No matter, for this exercise let's say $0.50 a square foot. If the surrounding property was renting for $50.00 a square foot. What would it mean?

It would mean their business department recognized a great deal, really pulled one over on whoever negotiated the contract for the city. How would that reflect badly on the Clinic?! Would you not grab the same deal for any of your clients? If they gave it to me I would try to run the damn hospital. To me this underlines two things. Clinic smart, city desperate to keep the largest employer and only hospital in town.

OK if you have a city that gave you this deal for 30 years, length of contract. And that space was in one of the most densely populated cities in the Midwest why on earth wold you move?

Now let's pretend I know nothing of advertising, and use your thoughts. They have spent millions on Fairview, how on earth could you recoup that money. Oh I know sales and service. How does one increase sales and service. Wait I got it, advertise! Yeah that's it you could advertise.

So, you are upset that the Clinic advertises Lakewood in kiosks, and you are upset that the advertise Fairview as well! Hmmmmmmmmmmmm. I am noticing a trend.

Your expansion paranoia. Well the Fairview expansion was land they owned or air wasn't it? Why spend the money in Florida? Maybe they didn't have a hospital there yet? Why not expand in Lakewood. To be honest I give them a little credit here, and shows they are sensitive to the community that made 60 minutes for Eminent Domain.

OK BILL - What is your gripe with the hospital? I mean this didn't really start with a kiosk ad on the east side.

Put your facts on the table RIGHT NOW.

Did you even read the contract? There are some troubling facts in the contract, but not one I can blame on the Clinic.

Disclosure Time
Clinic - Advertiser - good contract lawyers
City - Advertiser - maybe a little too desperate
Tom George - We agree more than half the time
Clinic Board - Do not know a single one

I have no knowledge of if they are moving or staying. None. I would be the first to be disappointed if they moved.

Both the city and the hospital in some small way just paid for you to post your note.


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[Jim O'Bryan]

Bill


Thanks for phone call.



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[Joan Roberts]

Mr Call.

Your scenario is not outrageous or even implausible. "Big box" medicine is as much a reality as "big box" retail, and Lakewood doesn't do big boxes. But it's still highly unlikely.
Because the Clinic does not own Lakewood Hospital, the absolute worst thing they could do is get out of the lease. That means creating space for a competitor to move in, be it UH, Columbia, or another hospital holding company. As others have indicated, it's unlikely the Clinic is fixing up LH to give it to University Hospitals.
A far more interesting question is, what kind of hospital will LH be in another 5-10 years? A specialty link in the CC chain? A community hospital outpost that sets broken legs, takes out gall bladders, and sends the interesting cases elsewhere? What kind of hospital do we want and need, and is CC giving us that?
Far more useful questions than worrying about something the Clinic neither has the power nor (probably) the inclination to do.

[Richard Baker]

I would tend agree with both Jim and Bill on some of their points they have brought up. I had hoped to complete an article two weeks ago about the lease and business arrangement between the Cleveland Clinic and City of Lakewood but information that has requested from our fair city has been sluggish in coming.

Before the LHA and the City entered into a lease the City of Lakewood borrowed tens of millions of dollars for improvements of the properties that were include in the lease. The Clinic is paying off these bonds as part of the lease arrangement; however, City revenue bonds have lower interest rate and they are tax exempt to investors. In addition the City had purchased eleven residential properties for the eventual expansion of the Hospital.

It would be absurd to assume that the uninsured are targeting Lakewood Hospital for medical care. Any person or family that meets the income or age requirements of Medicaid or Medicare ensures the hospital they will be paid for the services rendered.

The problem is with the middle class families that have lost their health insurance who don’t qualify for government financial assistance and are unable to afford private medical care coverage. Hospitals charge more for the health services they provide to this group of people then private insurance companies pay for the same service. Hospitals can give ten different reasons why they need to charge these people premium for services and the main reason they will quote will be due to the collections of monies owed. However, many of these people have lost their savings and homes due medical expenses and circumstances that where not necessary in their control.

In my opinion any hospital that charges more for medical care then the lowest insurance contracted cost for the same service to a non-insured citizen should not be able to remain as a not for profit corporation exempt from taxes. If a hospital feels the need to take advantage of those least able to afford health care, they should have the responsibly to pay taxes. After all police and fire protection, streets, schools, libraries, bureaucracy, etc are not free to most of us. Don’t misunderstand me there are many benevolent organizations that deserve [and some that don’t] the privileges of a not for profit corporate status but don't automatically confuse a not for profit hospital as a charity. I wouldn’t worry about the Clinic bailing out of Lakewood since the lease was extended before the original term was completed.

[Jim O'Bryan]

...Cleveland Clinic and City of Lakewood but information that has requested from our fair city has been sluggish in coming....

Richard

I am in production this week, but stop by and/or call I am sure there is a reason for the service. I learned a valuable lesson this week. Send the questions, ask for some time, and the city is more than happy to talk.

Before we start rumors. Give me a call, let's see what the Law Department's calendar is, and see what we can get answered for you.

Today, Mayor Tom George went out of his way to explain some things to me. As you know these records are public.

Last week we found out that one request for info in the budget went to the wrong department. Once it was asked, the Chief offered to walk us over and get us the numbers.




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[Bill Call]

Richard:

You hit on one of the most outrageous practices of area hospitals. They charge people without medical insurance much more than they charge insurance companies. If you have hospitalization your bill will say something like Invoice amount: $12,000 - Allowed amount $3,500. If you have insurance they accept $3,500 if you have no insurance they demand $12,000.

Joan:

The Clinic has no intention of closing Lakewood Hospital or leaving it to the University System.

My theory is that the will keep it opened in a weakened condition to:

1. Use it as a cash cow to fund expansion elsewhere
2. Deny the facility to UC
3. Weaken the customer base to make the facility less attractive to other medical providers.

The Clinic is a cut throat business. They are as non profit as Microsoft.
There is nothing wrong with that we should just recognize the reality.

[Joan Roberts]

The Clinic is a cut throat business. They are as non profit as Microsoft.
There is nothing wrong with that we should just recognize the reality.

No argument at all from me on that score. My only contention is that, since Lakewood Hospital is still publicly OWNED, we have more control over what the Clinic does with it or to it. Or we CAN have the control, if we care enough to exercise it.

[Jim O'Bryan]

...My theory is that the will keep it opened in a weakened condition to:

1. Use it as a cash cow to fund expansion elsewhere
2. Deny the facility to UC
3. Weaken the customer base to make the facility less attractive to other medical providers.

The Clinic is a cut throat business. They are as non profit as Microsoft.
There is nothing wrong with that we should just recognize the reality.

Bill

Work with me on this one.

Cash Cow, in other words a money maker to pay for other things in the Clinic System.

Why would they weaken the cash cow? If they wouldn't weaken the cash cow # 2 doesn't matter anymore.

Can you point out where the Clinic has every said they are non-profit? If not why are you pointing that out.

I am a MAC guy, you have to excuse me. The hospital has been a lot more helpful to me than Mr. Gates. But again I am a MAC guy, it might be different for you slaves of windows.

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[Lynn Farris]

Why wouldn't the clinic want a presence in the most densely populated city in NE Ohio?

What I see from the comments is that the Clinic did a good job of negotiating contracts with the city and the City didn't do so good.

I think if you look at other contracts we negotiated with other entities, we most likely should have hired someone else to do our negotiating.

Neither the clinic or Microsoft are not for profit. But it makes good business sense when you have a great deal as the clinic does in Lakewood to stay and expand.