Originally published in the Autumn 2022 edition of the Virginia Defender, issue 70, printed December 14. Reproduced here for accessibility and archival purposes. To find other stories in the Autumn 2022 issue or to download the full PDF, see this post. For other issues dating back to 2012, see the Full Issues page.
By Melinda Lewis
Richmond Community Hospital does not have an intensive care unit. It does not have a maternity ward. It no longer has kidney or lung specialists. Its cardiologists have long since gone. Its air conditioning sometimes breaks down. Standard medical instruments can be hard to find.
And yet, it’s the most profitable among Bon Secours’ Richmond hospitals. As The New York Times and the Richmond Times-Dispatch have recently reported, there is a reason: selling drugs.
A federal program created in the 1990s, called 340B after its section of federal law, allows hospitals that serve low-income communities to purchase drugs at greatly discounted prices, with the idea that they can then reinvest the savings into those communities.
In this case, Bon Secours qualified to purchase the discounted drugs because it owns Richmond Community Hospital, which serves Richmond’s largely impoverished East End. But instead of investing the savings back into that hospital, Bon Secours sells the discounted drugs at higher prices to wealthier patients around Greater Richmond, pocketing the difference.
Investing the savings into Richmond Community could have made a real difference for health care in the surrounding neighborhoods. Maternity wards might have served them better, given the maternal death rates of these communities, which are not just low-income, but predominantly Black. According to the Centers for Disease Control and Prevention, Black women are three times more likely to die from pregnancy-related causes than white women.
Intensive care units might better serve low- income communities, especially given the impact of COVID-19. Research by the National Institutes of Health shows that communities with a high African-American density have been disproportionately affected by the pandemic.
Richmond Community Hospital is owned by Bon Secours Mercy Health, one of the largest healthcare systems in the U.S., made up of 50 Mercy Health and Bon Secours hospitals and more than 1,000 care sites across seven states, plus five in Ireland. The system has more than 60,000 employees and a “pro forma net operating revenue of approximately $10 billion,” ac- cording to its website.
In 2020, according to the NYT, the system paid its chief executive officer $6 million in compensation.
Bon Secours (the name is French for “good help”) is a Catholic healthcare system that says its mission is “to extend the compassionate ministry of Jesus by improving the health and well- being of our communities and bring good help to those in need, especially people who are poor, dying and underserved.”
“Underserved” is the issue, and Bon Secours has underserved the East End, a community that, according to the NYT, is “home to Richmond’s largest black population” and “lacks some basic services.” The area only recently got a full-service grocery store.
Richmond Community could have been the focus of better serving this community. A hospital with a full range of services would have told the community that Bon Secours really wanted to improve its “health and well-being.” While Bon Secours touts that Richmond Community patients can easily use the services of its other hospitals, in reality that is difficult for many patients with spotty transportation, limited bus service and Bon Secours’ seeming reluctance to open those other beds to them, as reported by the NYT and RTD.
On the other hand, patients at Bon Secours’ St. Mary’s hospital in Richmond’s West End are well-served. That surrounding community, according to data from the 2021 American Community Survey of the Census Bureau for the 23226 zip code, has a median income of $62,696. It’s also 90 percent white.
St. Mary’s has the full range of a hospital’s services, with a cancer institute; a top cardio- vascular practice; high rankings for emergency medicine, critical care, stroke and the place to have a baby in Richmond, as Bon Secours says on its website.
Just as West End Richmond wants a St. Mary’s in its community, East End Richmond does as well. Rather than that, a program that should have provided them a St. Mary’s did not.
By making their other hospitals subsidiaries of Richmond Community, Bon Secours can use its savings from the 340B program to build clinics for those hospitals, as it has done with at least 10 such clinics, according to the RTD. As the RTD also has reported, Bon Secours is sending some of its Richmond profits to the system’s Ohio headquarters: in 2019, “for every dollar the not-for-profit made in revenue, 28 cents left the state and went to Ohio.”
What remains at Richmond Community is in some ways worse than the hospital that was founded in 1907 by Black doctors who could not work in hospitals in the West End. As Bon Secours notes on its website, Sarah Garland Jones, M.D., the first woman to pass the examination by the Virginia Board of Medicine, is credited with pioneering the early vision for Richmond Community.
The hospital is descended from the first African- American patient care facility in Virginia. Some of the doctors who worked there were so committed, according to the NYT, that one of them mortgaged his house to help pay to expand the hospital. Insurance changed things, chasing away the patients, as the NYT has noted. The Black doctors then sold the hospital to Bon Secours.
Insurance should have changed things again for Richmond Community with the 340B program. The hospital should have gotten all it needed: its patients back, an ICU, maternity ward, specialists. After all, it’s making the most money. It just isn’t keeping it.
While the 340B program is not working as it was intended, it could if Congress required it. The provisions of the program, in the Code of Federal Regulations, are lean by federal statutory standards: a few definitions, the ceiling price for the drugs and a process for dispute resolution. There is nothing in the law that says hospitals have to reinvest their profits – nothing. If that was the hope, it was not expressed. While many have touted those reinvestments as the objective of the program, the law does not say so.
The 340B program can work that way and many free clinics and community health centers have used it to do so, as reported by the RTD. Daily Planet Health Services pays its outreach workers with the savings it receives from the 340B program. While these clinics and health centers may be a small percentage of the program, as noted by Colleen Meiman in the RTD, they can show the way. These clinics and health centers provide critical drugs and outreach services for their patients, the poorest in the region, just like those around Richmond Community.
If the 340B program is to work that way, changes will have to be made. At a minimum, a reporting requirement could be added to the law. Participants in the program would have to report how much they have saved under the program and how they used those savings.
The program also could include an income requirement to define eligible patients, which it does not. Those changes might pressure participants in the program to use their savings for the communities that need it.
While Congress needs to make these changes to the program, organizations such as the newly formed Richmond Coalition for Healthcare Equity are pressuring Bon Secours to make changes itself, including investing all of its profits in low-income communities.
The money is there in the program to help the poorest in the region. As reported in the RTD, Virginia Commonwealth University wanted to buy Richmond Community, but Bon Secours declined. It apparently has no interest in getting rid of its cash cow.
The original Sept. 24 New York Times story, titled “Profits Over Patients,” has received wide media coverage in Virginia. In a statement to VPM News, Bon Secours Mercy Health spokesperson Jenna Green wrote that “Richmond Community Hospital maintains rigorous internal oversight of the 340B program so that we can continue to provide accessible, affordable, high-quality care through this and other programs that improve the well-being of the greater Richmond community.”
Ms. Green was contacted again for this story to ask whether Bon Secours plans to use the funds from the 340B program differently given the concerns raised in the community and whether Bon Secours had any additional services and/or improvements planned for Richmond Community.
Ms. Green had not responded by the time this story went to print.
If Richmond Community got a little less of the funds funneled away from it, maybe it at least could have reliable air conditioning – and maybe some good help
Categories: Community News