After a listening to more than two hours of testimony involving contracts between the University of Arkansas for Medical Sciences and Baptist Health Medical Center-Conway, a legislative committee said Thursday it wants to continue looking into the arrangement for possible elements of collusion.
"Just based on the descriptions that we heard today, the fact that UAMS said, ‘Oh, sure we're willing to work out arrangements with other entities, but we don't feel we have to offer the same thing,' … that's a practice that fits under the definition of collusion," said Rep. Mark Lowery, R-Maumelle, who is a co-chair of the Joint Performance Review Committee.
Lowery told Arkansas Business late Thursday that he and the Senate chair, Missy Irvin, R-Mountain View, are going to expand the committee's look into what competitors call an unfair alliance between taxpayer-supported UAMS and Baptist Health of Little Rock, the hospital's parent company.
"Even though the higher education institutions have their own procurement offices, we believe that they still have to adhere to these guidelines on Arkansas procurement laws," Lowery said.
Leslie Taylor, a spokeswoman for the University of Arkansas for Medical Sciences, provided this statement in response to Lowery:
"We respectfully disagree. There has been no state procurement contracting collusion between UAMS and Baptist. UAMS is not procuring services from a vendor. Rather, UAMS is being paid for services provided to a private not-for-profit based on the terms of a contract initiated by Baptist," she said. "We have many other similar contracts including one on a much larger scale at Arkansas Children's where UAMS-employed physicians provide the majority of care to patients."
Lowery said the committee plans to hold another hearing, but it might not be until after the start of the Legislature's fiscal session on Feb. 12.
The joint committee scheduled Thursday's meeting following a Jan. 8 report in Arkansas Business about the effect UAMS' contract to provide physician services to Baptist's new Conway hospital was having on Conway Regional Health System.
Carrie Helm, CEO of Arkansas Surgical Hospital in North Little Rock, told committee members that she wished her hospital had the same deal Baptist Health received from UAMS. She echoed concerns first raised by Matthew Troup, president and CEO of nonprofit Conway Regional, who complained that taxpayer-supported UAMS had given Baptist-Conway an unfair competitive advantage.
Helm said that for-profit ASH spends tens of thousands of dollars to recruit orthopedic surgeons, but Baptist Health was able to leverage its relationship with UAMS to get them at "fair market rate" to staff the hospital it opened in Conway in September 2016.
"I don't blame Baptist for doing this," she said.
Helm said she has asked UAMS to send its orthopedic doctors to provide services at Arkansas Surgical Hospital — and even said the hospital would build another operating room. UAMS' response has been, "‘Well, we might be interested one day.' And that's has far as it has gone," Helm said.
Stephanie Gardner, interim chancellor at UAMS, told the committee that UAMS has hundreds of relationships with medical providers across the state and is willing to work with any provider.
But she said that not all the contracts are the same.
The teaching hospital's relationship with Baptist Health, Gardner said, goes beyond just providing doctors. She said working with Baptist allows UAMS to carry out its mission of educating future physicians and health care workers, as well as improving overall health and access to care for Arkansans. In addition, UAMS Medical Center is full or nearly full.
Troup told the committee that UAMS could have gone to another hospital, like Jefferson Regional Medical Center in Pine Bluff, if it was it was facing capacity constraints. Instead, he said, UAMS decided to help out Baptist Health after it built a $150 million hospital.
Gardner said she would provide the committee with information on revenue received from Baptist Health for providing emergency room and orthopedic services in Conway. UAMS would not release that information when requested by Arkansas Business, saying it fell under the competitive advantage exemption to the Arkansas Freedom of Information Act.
Sen. Jim Hendren, R-Gravette, asked what would happen to UAMS' finances if it stopped providing services to health care providers for fees.
Gardner said UAMS, which receives about 80 percent of its revenue from patient services, would miss out on millions of dollars. Its contract to provide doctors to Arkansas Children's Hospital is worth about $60 million, she said.
Gardner said Baptist-Conway reimburses UAMS for the doctors' salaries and and other costs, but payments from patients and insurers go to Baptist Health.
Rep. Reginald Murdock, D-Marianna, suggested that it would be better for UAMS to work with other organizations than for the Legislature to get involved.
"We need all of you working together," he said. "That's my plea."