Telshor Fund has come at a high cost

The Telshor Fund was created by the city in 2004 to bank its share of the revenue from the 40-year lease on Memorial Medical Center to Lifepoint Health, a corporation with 62 hospitals in 16 states.

Net proceeds to the city were $26.1 million, with another $4.2 million in additional escrow funds for a total of $30.3 million, according to the city’s website.

It’s been used since then for many worthy programs including $1.5 million a year for The Boys and Girls Club; funding for La Piñon’s Sexual Assault Nurse Examiner program and a new building to expand child abuse treatment services; support for both El Crucero and My Friends Place; expansion of Casa de Peregrinos food distribution services, along with $1.2 million for the Roadrunner Food Bank’s Childhood Hunger Initiative; and creation of a new veterans’ treatment court in the Third Judicial District.

Given that the hospital was deeply in debt at the time of the transfer, things have worked out pretty well for both the city and county governments, who split the proceeds. The same cannot be said for residents in need of health care. 

Recent reporting by NBC News found that MMC routinely denies care or demands up-front payments from indigent or low-income patients. That has been especially devastating to cancer patients, who have no other options in Las Cruces.

The NBC story focused on Barbara Quarrell, who had worked for years as a nurse at MMC. When she was diagnosed with cancer, Quarrell was told by MMC that the True Health New Mexico insurance plan she had paid $800 a month for was insufficient, and she was denied treatment. She and her husband have moved to Albuquerque to get the care she needs.

If the allegations from both patients and doctors are true, MMC is in violation of both its lease and state law. The New Mexico Public Assistance Act requires qualifying hospitals to “accept every indigent patient who seeks health care services.”

That’s where state Attorney General Raúl Torrez enters the picture. At a press conference announcing an investigation into MMC, the AG alleged it had improperly denied care; engaged in questionable billing practices; and created a culture of fear and intimidation to silence critics.

Torrez said they will also be looking into whether MMC has violated the Patients Debt Collection Protection Act, which requires hospitals to screen patients for financial assistance. MMC faces potential fines, and Torrrez said whatever evidence his office collects will be turned over to federal authorities.

While the AG can’t force Lifepoint out, the city and the county can. The probe is likely to produce clear and convincing evidence that the company is in violation of its lease.

That would, of course, bring the inevitable question of what comes next. Ours isn’t the only rural hospital to have fallen into the clutches of a private equity firm. Since 1981, 1,219 community hospitals made the switch to for-profit, according to the American Hospital Association.

There aren’t a lot of great options. Health care has never fit well with our free-market economy, which is why Republicans in Congress tied themselves in knots trying to repeal and replace the Affordable Care Act. They could never agree on the “replace” part.

But surely we can improve on what we have now.

Walter Rubel can be reached at waltrubel@gmail.com.