Hospitals battle in court over service districts. Parish councils could intervene
Two of the largest hospitals in Terrebonne and Lafourche are fighting in court over turf. The parish councils could step in to resolve the issue.
The lawsuit is playing out in Judge Jason Dagate's courtroom as a dozen attorneys make arguments about why Thibodaux Regional can or cannot move into Terrebonne General's service district space. They will return April 30 to deliver closing arguments in front of Dagate.
The arguments could be moot, however, if the Lafourche Parish Council and Terrebonne Parish Council chose to merge the hospital service districts.
"That's a double-edged sword," Lafourche Parish Councilman Armand Autin said. "It gets real complicated in a merger. I wish it was just a slam dunk, easy peasy, but it's really not. I would imagine our service would get even better. It would be an even more powerful group, but I don't know."
The hospital service districts were established by the Louisiana Legislature as government entities to ensure quality health care for residents. These districts cannot move into one another's space without permission of the hospital service district that controls the area. Service districts are allowed to buy equipment at state-set prices and allowed to tax their communities.
The law provides police juries with the power to create and merge service districts, expressly stating they can cross parish lines. In most parishes, like Terrebonne and Lafourche, police juries became parish councils.
Thibodaux Regional is arguing that it is no longer beholden to these laws because it separated itself from the service district in pursuit of growth. Shortly after Thibodaux Regional received an opinion from the Attorney General's Office about the separation, it opened clinics in Assumption Parish and St. James Parish.
During the trial, Thibodaux Regional CEO Greg Stock said the law inhibits hospitals' ability to grow. He said the hospital chose to take the battle to court because they didn't think they could convince legislatures to change the law.
St. James Parish Hospital CEO MaryEllen Pratt said she disagrees with Stock. Hospitals, she said, can grow. They just have to come to agreements with one another.
According to Pratt, St. James was in talks with Thibodaux Regional about providing a cardiovascular clinic into her service district. An agreement could not be met, so she met with another entity to provide cardiovascular healthcare. Some time after, Thibodaux Regional moved in anyway, and now St. James Hospital is suing Thibodaux Regional as well.
Daniel A. Cavell is the chairperson of Lafourche Service District 3. His service district currently leases the facilities to Thibodaux Regional. Cavell said he doesn't believe service districts should still exist.
"The parochial-ness of it doesn't serve the purpose that it did way back when," Cavell said. "But then again, if I was in a service district that was not as productive, or not as successful as we have been, I may want to protect my turf because somebody else was invading it."
The free market, Cavell said, would provide better prices and better healthcare. Terrebonne Parish Councilmember John Amadee said he also thought the free market would drive down costs but wasn't aware that the parish councils had the power to combine hospital service districts. He said he would look into the laws and discuss it with the rest of the council more after Dagate made his ruling.
"As an individual of the public, I would like to see them in competition. Maybe it would drive down some of the costs," Amadee said. "I believe competition helps to control and lower costs."
Autin said service districts had their pros and cons. He said when the laws were established, people had far less mobility to cross parish lines. If you lived in an area, that was the service district that provided your healthcare. He cautioned against the idea of doing away with service districts altogether and leaving healthcare to the free market entirely.
"If it's 100% in the private sector, what happens if they feel like they are not making profits and they just pull out? Then we have nothing," Autin asked. "I think that's one of the benefits of having the hospital service district, so that you maintain something in the event of a catastrophic event where private pulls out or decides they are moving on."
This article originally appeared on The Courier: Terrebonne, Lafourche parish councils could intervene in hospital fight
