Opinion: Time to ask MSK some tough questions
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Memorial Sloan Kettering Cancer Center in Manhattan. Photo via Memorial Sloan Kettering
By Sandra Brown
Memorial Sloan Kettering Cancer Center is a non-profit Comprehensive Cancer Center headquartered in Manhattan, with 16 additional outpatient facilities around New York and New Jersey. As a retiree and breast cancer survivor with a fixed income, I know how essential it is to have access to quality and affordable cancer care. When it comes to MSK, it is time we take a look at some of its business practices and start asking questions.
Earlier this year, MSK sent out letters to Cigna members threatening that, unless Cigna agrees to steep rate hikes, patients wouldn’t be able to receive care at their facilities or see their doctors anymore. The tactic seems to have worked. Days later, the two appeared to have quietly found a resolution (One is left to wonder how much Cigna had to cough up to buy the silence.)
Less than a year later, MSK is at it again, sending Anthem’s members what appears to be the same threatening letters. It almost seems scripted.
So, what’s really going on? Is there really a threat to patient access?
Probably not. There’s a growing trend of hospitals using patients as pawns to net higher reimbursements from insurers. In North Carolina recently, CaroMont pledged to take all United Health patients out-of-network months ahead of its contract with the insurer expiring in order to force higher reimbursement rates. In Pennsylvania, Lehigh Valley Health Network put Aetna patients out-of-network in order to attempt to foist higher reimbursement rates on the insurer. And in Texas, CHI St. Luke's threatened to take 70,000 Cigna patients out-of-network in a dispute over reimbursement rates.
These examples and others have led to an employer representative penning an article titled, “Hospitals’ drive for more money leaves patients hanging.” A seniors advocacy organization claimed hospitals were taking patients “hostage” to get paid more.
It’s even prompted leading Washington think tanks to develop policies lawmakers can consider to “stop hospitals from dumping patients.”
At the heart of the matter is a cottage industry of consultants who urge providers to pursue an “out-of-network” strategy to get higher payments.
In other words, it’s a hardball negotiating tactic hospitals are using, toying with patients mental and physical health to boost their own bottom lines.
Does MSK’s leadership have one of these high-priced advisors driving this strategy?
And speaking of high-priced, according to the latest available IRS filing, MSK’s CEO and dozens of high-level staffers raked in multiple millions and the hospital flew its top personnel first-class or private.
So even though MSK is supposedly a non-profit, which means it does not pay the kind of taxes that the diner or deli next door has to pay, there is a lot of profit being taken. Indeed, tax records show MSK had $400 million in surplus income—also known as profit—not to mention billions in assets, but paid no federal taxes.
Why doesn’t MSK pay those taxes? Because, like many other tax-exempt hospitals, they argue that they provide millions of dollars in “charity care.” Yet much of what they claim is free care is really emergency care that all hospitals are required to provide by law. In fact, a study published in 2021 found that for-profit hospitals provided 65% more charity care than their non-profit counterparts.
Another study, in the Journal of the American Medical Association, found it was a not uncommon practice for non-profit hospitals to sue and garnish the wages of low-income patients who can’t afford to pay the sky-high bills.
While many questions need to be asked, one thing that is not up for dispute is the fact that the cost of hospital care is driving our rising healthcare costs and having a detrimental effect on our economy and American families.
The American Medical Association found that the largest share of healthcare spending, over 30 percent, goes to hospitals.
In new research, scholars at Yale, Harvard, the University of Chicago, and the University of Wisconsin-Madison have determined, "Over the past two decades, hospital prices have outpaced the price growth in all other sectors of the U.S. economy.” They conclude that higher healthcare costs lead to job losses, lower income per capita, disproportionately affect lower- and middle-income Americans, raise the share of individuals who receive unemployment benefits, and reduce federal income tax revenue.
Even more troubling, these scholars cite research showing that the job losses created by these hospital-driven higher healthcare costs can lead to significantly higher mortality rates among affected workers along with “increases in hospitalization for self-harm, suicides, and drug overdoses.”
There is no doubt that more needs to be done to hold hospitals—especially tax-exempt “non-profit” hospitals—accountable for using patients as pawns to get insurance companies to cough up unnecessarily high payments for essential care. Memorial Sloan Kettering certainly cannot be exempt from this scrutiny.
Sandra Brown is a New York City resident and breast cancer survivor.
