Grady critics need lesson in finance

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Grady critics need lesson in finance

By Bill Sexson

Grady’s dialysis patients and their advocates are directing their ire at the wrong target in their fight to reinstate dialysis care. Instead of taking aim at the hospital and its administrators, they should be lobbying local governments and the Legislature for more money.

As even the critics acknowledge, Grady is spending hundreds of thousands of dollars on dialysis care following the closure of its dialysis clinic last fall. (Without such care, these patients will die.)

What was left unsaid is the budget impact of these dollars and the trade-offs necessary to spend this money. Any money spent by Grady on patient care comes directly from Grady’s operating budget. The operating budget at Grady is relatively fixed, so that shifting dollars between programs, no matter how good the cause, means that some other program will get less. Grady’s operating budget consists primarily of the counties’ contributions, money from state and federal grants and contracts, as well as patient care revenue.

These contributions have not increased for almost two decades, despite the dramatic increases in health care costs over this period. This year, because of the declining economy, county contributions have actually been cut, thus cutting the lifeline for many patients.

Grady’s operating budget goes to pay for the health care staffing, supplies, medications, instruments and the upkeep of the facility. Because of the huge number of “self-pay” (read that “no-pay”) patients who come to Grady, the hospital has limited ability to generate operating income like other hospitals.

Over the course of the last 10 years and eight administrators, Grady has kept its operations budget in check by firing personnel; delaying the purchase of needed new equipment; eliminating programs and, at times, pursuing a plan of delayed or nonpayment to its creditors.

Basically, any money spent from the operations budget means that that money is not available for other parts of the operations, i.e., for other services or for other patients. As past operating budgets have been limited or cut, physicians and administrators at Grady have been in the very real and very difficult position of having to decide which needed procedure, therapy or medication was not going to be provided at the community standard.

With all the talk about the money raised by the new corporate board, it must be recalled that this new money is generally designated for capital improvements (e.g. equipment and “bricks and mortar”). Little to none of this new money can go toward the operations budget.

Since funding for Grady operations comes primarily from the counties and the state, the dialysis patients, their lawyers and advocates might do better if they take their protesting and lobbying to the County Commission and the Legislature. It is only with increased funding that patients who are currently receiving needed service will be certain to get their prescribed care. Without increased funding of operations, Grady is going to be faced with the difficult choice of how to bring costs of other programs down in the face of the hundreds of thousands of dollars spent on the dialysis patients.

Two of the ethical and professional responsibilities of a physician are the commitment to improving access to care and a commitment to just distribution of finite resources. Obviously at Grady, these two responsibilities are in constant conflict. Tension exists between the lack of operational funding for needed programs and the people who clamor at Grady’s doors asking for care. The truth is that there are always trade-offs, and rarely does our society engage in a truly open discussion of such difficult ethical conundrums.

As a society, we cannot close our eyes to the reality. Without increased funding, Grady cannot provide services to needy patients. Which program might then be cut or which patient will not receive care? Now there are a couple of questions of ethical importance that really deserve public discussion.

Bill Sexson is associate dean for clinical affairs at Emory University School of Medicine and a faculty member at the Emory Center for Ethics.

http://www.ajc.com/opinion/grady-critics-need-lesson-327347.html