Why Should Delaware Care?
Delaware’s hospitals are powerful and often consolidated entities. For decades, each of the state’s three main hospital systems have remained within their bounds by county line. But as more retirees flock to the state, those boundaries are being disregarded.
Downstate hospital systems lambasted two proposed ChristianaCare campuses in Georgetown and Camden on Tuesday, following what has been months of controversy that could derail the projects.
At a Delaware Health Resources Board meeting, a government body responsible for approving large healthcare expansions, leaders from the state’s downstate hospital systems asked regulators to halt the project. The hospital leaders questioned both the merits and legality of the proposed expansions.
The lower counties have long been considered outside of ChristianaCare’s regional grip, but ChristianaCare said it believes the new campuses would bring more emergency care to Kent and Sussex counties, as the state continues to age and faces access shortages.
Delaware’s downstate hospitals — which included Bayhealth in Dover, TidalHealth in Seaford and Beebe Healthcare in Lewes — challenged ChristianaCare’s reasoning saying the new facilities could make emergency care more expensive for patients.
In their presentations, hospital leaders also said the projects, dubbed “microhospitals,” lack a regulatory definition under Delaware law and may run afoul of another law signed this summer meant to curb the involvement of for-profit enterprise in nonprofit healthcare.
Delaware’s Health Resources Board did not take any kind of vote on the projects on Tuesday, but will likely consider the projects at another meeting next month.
What happened during the meeting?
Tuesday’s meeting was an opportunity for ChristianaCare to defend its proposals from what has been a sustained effort by the other hospitals to shut them down. All the downstate hospitals made it clear they support investment and competition in Kent and Sussex counties, but they did not believe ChristianaCare’s proposals would benefit the healthcare ecosystem at large.
ChristianaCare opened the public hearing with a presentation, which said its two proposed “microhospitals” would support a healthcare ecosystem in need of more emergency room beds.
The upstate hospital’s proposals would bring eight emergency room beds and eight inpatient beds for each of its locations, but opponents questioned how transfers would work for patients in need of higher levels of care than the microhospitals could offer.
Vinay Maheshwari, who is ChristianaCare’s physician executive of growth and strategic partnerships, said the hospital hopes to partner with the other regional systems so patients do not have to transfer from a Sussex County microhospital back up to ChristianaCare’s main campuses in Newark or Wilmington.
“It will take partnership,” Maheshwari said. “We are committed to working through that partnership with all of you, and we hope that you will as well.”
Bayhealth’s chief operating officer, Kyle Benoit, opposed the proposals, saying the new emergency services would add “exceptionally high costs for a low-volume benefit for the community.”
Benoit also pointed to another attempt by Beebe Healthcare to build a freestanding emergency room similar to ChristianaCare’s proposal, which the board denied in 2019.
“This is not about protecting our turf,” Benoit said. “It’s about what is the right investment to address the excess and cost challenges that are plaguing our residents of Delaware and really healthcare across the country.”
Delaware’s southern hospital systems also took aim at a lack of regulatory guidance on how ChristianaCare is defining its Camden and Georgetown proposals.
When ChristianaCare announced the proposals earlier this year, it said it aimed to build two “microhospitals” in Kent and Sussex, a term the other hospitals believe makes them invalid for consideration.
Steve Leonard, the CEO of TidalHealth, requested the board deny the proposal on the grounds that no definition exists in Delaware code to classify the microhospitals. Without clearer guidance, he said, there may not be adequate protections in place for patients.
Leonard also said the microhospitals would bring an “increased cost” to services in Sussex County. He pointed to recent legislative efforts to bring down the cost of care, and said ChristianaCare has some of the highest rates in the state.
Maheshwari denied ChristianaCare’s costs are among the highest in the state, instead saying they are comparable to other systems. But Leonard requested the board require ChristianaCare demonstrate how its proposals would bring down costs in the area.
“General statements about neighborhood hospital ER wait times, visit times, they’re just not enough,” Leonard said.
Downstate arms race
For decades, Delaware’s three major health care systems largely fit into geographic monopolies: ChristianaCare serving New Castle County, Bayhealth serving Kent County and Beebe Healthcare in Sussex County.
But over the last five years, a health care arms race heated up between Bayhealth, Beebe and now TidalHealth, coming up from Salisbury, Maryland. They have all built or broken ground on major projects in locations, such as Lewes, Milton or Millsboro in recent years.
It follows a post-COVID population boom in Sussex County. The region is now designated as a “Medically Underserved Area” by the federal government, with projections showing that the population will increase from 237,000 in 2022 to over 361,000 by 2050. The county is also rapidly graying, as the population growth is largely driven by retirees who will demand more health care needs.
The arrival of ChristianaCare, which to date only had primary care offices in Milford and Rehoboth Beach, will bring needed resources, but also new competition to the crowded market.
In 2019, the board was central in a debate over whether to allow Beebe to build a freestanding emergency room in Georgetown. It ultimately denied that project, saying it was too close to Bayhealth’s Milford campus and Nanticoke Hospital in Seaford.
The board was also expected to be critical of plans by Bayhealth to build its own freestanding emergency room in Milton, which led the Dover-based health system to pull its plans.
Both of those projects, however, predated the population surge that has particularly struck Sussex County after the COVID housing market boom.
The Health Resources Board did not make any final decision on the fate of ChristianCare’s proposals. The board will meet again next month, where it will likely continue discussions.
