Shifting Care

Pushing Patients Out of Hospitals

A handsome mature man stands recovered from his disability near a wheelchair and raised his hand in a sign of victory, standing in the clinic corridor.

In recent years, Allina executives have worked to shift key services out of the hospital, a key priority of health insurance companies who make millions off of skyrocketing patient costs. A frequent strategy to cut costs and serve the bottom line is to move surgeries offsite. Surgical centers typically represent an opportunity for healthcare companies to prioritize their bottom line, with fewer staff and services than a patient would have access to in a hospital.[1]

In late 2020, Allina executives announced a joint venture with Surgical Care Associates (SCA) to develop up to a dozen of these off-site surgical centers.[2] SCA is owned by the nation’s largest health insurer, UnitedHealth Group, which made more than $17 billion in profits in 2021.[3]

Allina executives have also cultivated close ties to another health insurance company, Blue Cross Blue Shield (BCBS). Not only is BCBS Allina’s largest payer,[5] but the two companies are partners under a 6-year agreement[6] designed to “reduce costs,” a process which typically results in reduced staffing, services, and supplies in hospitals. BCBS is currently under investigation for its policy of pushing patients away from hospitals to lower-cost surgical centers.[7]

Allina also operates an insurance company of its own through a joint venture with the health insurance giant Aetna, whose parent company posted profits of more than $17 billion in 2021.[8]

 

“Any same-day procedure [...] we've been working to really create [an] opportunity for them to move off-campus.”

Allina President & CEO Lisa Shannon [4]

Outsourcing Care to the Home

The pandemic also provided Allina executives with an opportunity to further outsource care from the hospital and into the home, as virtual visits for the health system increased by more than 4,000 percent between 2019 and 2020.[9] Patients know that virtual care is no substitute for hospital treatment at the hands of trained healthcare professionals at the bedside. Despite promising “frequent” visits from a nurse and a daily virtual visit,[10] “Home Hospital Care” programs place the burden of care on patients rather than a trained professional. They also act as a cost-cutting mechanism for Allina executives, allowing them to reduce staff and supply costs that account for the increased care available in a hospital facility.

The profit-driven shift to virtual healthcare also presents serious challenges for rural patients, who often lack access to the high-speed broadband internet service necessary for such services. The shift to virtual healthcare also threatens to increase the rate of profit-focused closures, as more revenues are taken out of local clinics and sent directly to healthcare executive offices.[11]

 
 

Closing Local Clinics and Services

At the same time Allina executives have touted “[m]eeting people where they are,” the health system has closed essential services in one hospital and announced an upcoming closure in another. In late 2021 and early 2022 the hospital system announced it was moving labor and delivery services out of Regina Hospital and Cambridge Medical Center to other facilities many miles away.[12] Despite concerns raised by community members in public hearings, Regina Hospital President Helen Strike said, “The decision is already made. And, we will not be reversing our decision based on the public comment.”[13]

In addition to the effect on expectant mothers, who will now have to drive 20 or more miles away, this shift may strain struggling hospitals nearby and in the Metro area, an effect which may be amplified by the recent decision of Allina executives to merge Regina Hospital in Hastings with United Hospital in St. Paul.[14]

“I can't imagine having to go out on the freeway or being stuck in a snowstorm somewhere trying to get to Woodbury or somewhere else. It's so scary.”

Melanie Reinardy, New Trier, MN

SOURCES

[1] Christopher Snowbeck, “Minnesota Nonprofit Hospitals in Tug-of-War with Insurers over Efforts to Rein in Costs,” Star Tribune, January 11, 2020, https://www.startribune.com/nonprofit-hospitals-in-tug-of-war-with-insurers-over-efforts-to-rein-in-costs/566850672/.

[2] Christopher Snowbeck, “Allina Partners with Optum on Surgery Centers,” Star Tribune, January 10, 2020, https://www.startribune.com/allina-partners-with-optum-on-surgery-centers/566878282/.

[3] Jeff Lagasse, “UnitedHealth Group Earned $17.3B in 2021, According to Earnings Report,” Healthcare Finance News, January 19, 2022, https://www.healthcarefinancenews.com/news/unitedhealth-group-earned-173b-2021-according-earnings-report.

[4] Christopher Snowbeck, “Allina Health Sees Income Grow with Expense Control,” Star Tribune, May 19, 2021, https://www.startribune.com/allina-health-sees-income-grow-with-expense-control/600059005/.

[5] Allina Health System, “Quarterly Financial Disclosure Statement Twelve Months Ended December 31, 2021,” Electronic Municipal Market Access (EMMA), https://emma.msrb.org/P11563565-P11207122-P11626573.pdf.

[6] Allina Health System, “Quarterly Financial Disclosure Statement Twelve Months Ended December 31, 2021,” Electronic Municipal Market Access (EMMA), https://emma.msrb.org/P11563565-P11207122-P11626573.pdf.

[7] Christopher Snowbeck, “Minnesota Nonprofit Hospitals in Tug-of-War with Insurers over Efforts to Rein in Costs,” Star Tribune, January 11, 2020, https://www.startribune.com/nonprofit-hospitals-in-tug-of-war-with-insurers-over-efforts-to-rein-in-costs/566850672/.

[8] Wendell Potter, “Despite a Profitable 2021, Expect Higher Deductibles and Premiums in Aetna’s Health Plans for 2022,” Substack Newsletter, Wendell Potter NOW (blog), February 15, 2022, https://wendellpotter.substack.com/p/despite-a-profitable-2021-expect.

[9] Allina Health System, “Quarterly Financial Disclosure Statement Twelve Months Ended December 31, 2021,” Electronic Municipal Market Access (EMMA), https://emma.msrb.org/P11563565-P11207122-P11626573.pdf.

[10] Allina Health System, “What to Expect From Allina Health Home Hospital (Home Health, Emergency Department, Hospital),” Allina Health, https://account.allinahealth.org/library/download?templateUID=39D9FBC3-FBCE-4D05-87D0-3FC666F7E5B3&documentUID=628a1379-b7b7-4513-8ba2-26d0890885d7.

[11] Minnesota Nurses Association, “Outsourcing Care: The False Promise of the Nurse Licensure Compact,” Minnesota Nurses Association, https://mnnurses.org/issues-advocacy/issues/top-legislative-issues/outsourcing-care-the-false-promise-of-the-nurse-licensure-compact/.

[12] Sophia Voight, “Regina Hospital in Hastings to Close Birth Center Due to Declining Birth Rate,” Hastings Star Gazette, October 18, 2021, https://www.hastingsstargazette.com/news/regina-hospital-in-hastings-to-close-birth-center-due-to-declining-birth-rate/article_ffec0bcc-304a-11ec-b9fc-a3b7b5520186.html;  Rachel Kytonen, “Allina Health Outlines Transition of Labor, Delivery Services out of Cambridge,” Hometown Source, March 3, 2022, https://www.hometownsource.com/county_news_review/news/local/allina-health-outlines-transition-of-labor-delivery-services-out-of-cambridge/article_4824d618-9b1b-11ec-8df4-27ed5362e10f.html.

[13] Ava Kian, “Hastings: Regina Hospital to Send Expecting Moms to St. Paul to Give Birth,” Pioneer Press, November 16, 2021, https://www.twincities.com/2021/11/16/relocation-of-regina-hospital-labor-and-delivery-services-in-hastings-leaves-community-with-questions/.

[14] Frederick Melo, “United Hospital in St. Paul and Regina Hospital in Hastings to Merge in August,” Pioneer Press, April 7, 2022, https://www.twincities.com/2022/04/07/united-hospital-in-st-paul-and-regina-hospital-in-hastings-to-merge-in-august/.