CARTI's New Plan Upsets Decades-long Relationship

by Mark Friedman  on Monday, Apr. 30, 2012 12:00 am  

Cracks in the Relationship

After decades of growth and expansion to satellite campuses around the state (see Seeds of CARTI Planted 44 Years Ago), cracks appeared in the relationship between CARTI and some of its partners.

Around 2009, Arkansas Urology of Little Rock, which had been sending its patients to CARTI for treatment, decided it wanted its own radiation treatment equipment.

“Because it’s a revenue source,” Karen Flake, CARTI’s board chairman, explained in the March 29 UA board meeting. “This is really about money.”

In 2009, Arkansas Urology said its new 6,700-SF facility was a joint venture with AKSM/Oncology Inc. and cost $3.3 million to build and another $2.7 million for the equipment.

Flake said the loss of Arkansas Urology patient referrals cost CARTI “a few million” dollars annually in lost revenue.

Arkansas Urology CEO John Hutton didn’t return a call to Arkansas Business.

Flake said in the meeting that after Arkansas Urology stopped sending patients to CARTI, another of its larger referring customers, Little Rock Hematology Oncology, wanted to buy CARTI’s location at Baptist Hospital.

“And [LRHO said] if you didn’t sell to us, we’re going to go out and put in our own radiation treatment equipment,” Flake said.

“We were in a really difficult place.”

Flake said it was a survival move to buy LRHO, which had been working with CARTI for about a quarter century.

She told the board members that she feared that if CARTI lost LRHO “we were probably going to close our doors. … The size of our system would have diminished quite a bit.”



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