Schneider losing millions to competing doctors

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ST. THOMAS - In an effort to counteract the financial loss resulting from a reduction in surgeries at Schneider Hospital, the hospital is beginning to offer more procedures to draw patients and dollars back in.

An increasing number of patients are choosing to undergo surgery outside of the hospital, most of them choosing to go to private practices on-island, according to Schneider Hospital Chief Executive Officer Bernard Wheatley.

In the most recently calculated month, June 2014, the hospital handled 2,289 surgeries, 31 less than the same period last year, he said.

While it may not seem like a major difference, it equates to about $900,000 in lost revenue, Wheatley said, the difference between $15.6 million in June 2013, and $14.7 million in June this year.

If the hospital loses $900,000 per month in a year, the hospital would lose $10.8 million annually.

"All of the paying patients are going to the offices," Wheatley said.

Only a handful of offices with surgical suites, or spaces to conduct operations, exist on-island outside of the hospital, and many of the doctors who run the offices also are employees of the hospital, which is common in the states.

However, Wheatley said the insurance companies compensate private practices at a higher rate - though Wheatley could not provide specifics - than they compensate for surgeries in the hospital.

"It's a free enterprise system. You can't stop it really," Wheatley said.

The hospital first started to see the drop in surgeries in October last year, he said, after which Schneider officials began to brainstorm about what kind of procedures the hospital could introduce to bring some of its patients back in.

For instance, starting in July, Schneider Hospital began inserting pacemakers, devices that use electrical impulses to regulate the beats of the heart.

For years, the hospital has been conducting follow-ups, but patients have had to get the actual pacemaker insertion - a relatively simple 40-minute procedure - done elsewhere, primarily at Luis Hospital on St. Croix, according to Schneider Hospital cardiologist Dr. Roy Flood.

"I'm sure we were losing money on pacemaker insertions," Flood said.

Neither he nor Wheatley could estimate the reimbursement that hospitals receive for pacemaker insertions. Each year, Flood has had to send away between five and a dozen patients needing pacemakers.

In July alone, Flood completed six insertions, though only because he had informed prospective patients that he was training to perform pacemaker insertions.

Other procedures that the hospital has introduced include retina attachments, where an ophthalmologist re-attaches a person's retina to the supporting tissue; non-invasive hysterectomies, where a woman's uterus is removed; and electroconvulsive therapy, which today is commonly used to reverse certain mental illnesses.

However, the increase in patients and funds resulting from the new procedures is not expected to balance out the loss of patients and funds Schneider has experienced from the substantially fewer surgeries it has had in the past year, according to Wheatley.

Hospital officials more frequently are discussing how they could create incentives for the patients to return to the hospital, and for the physicians to conduct surgeries within the hospital, but Wheatley is not sure it can compete with the better insurance payback.

"That model works fine in the states, but here, not so well. There's concern about the hospital's viability," Wheatley said.

- Contact Jenny Kane at 714-9102 or email

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