Providence St. Joseph Watch

Keeping a watchful eye on the nation’s ever expanding third largest hospital chain.


Scandal at Swedish in Seattle; risks to patient care at Adventist hospitals in Northern California

Providence Health & Services took over Seattle-based Swedish Health Services in 2012. At the time of the merger, the Swedish Neuroscience Institute was the Northwest’s most prestigious center for brain and spinal surgery.

Five years later, the institute was under investigation by the U.S. Department of Justice and its top surgeon and top executive resigned in disgrace after a Seattle Times investigation chronicled how Providence St. Joseph transformed a vital community resources into a cash cow that put patients at risk.

Now Providence is seeking to take over five Adventist Health hospitals in Northern California as part of a merger that both entities have already stated will result in the elimination of any duplicative services.

What happened at Swedish is a cautionary tale for the residents served by Adventist hospitals in Clear Lake, St. Helena, Ukiah, Willits and Vallejo. Click here to receive alerts and news updates about the Adventist merger. (This should also link to the Adventist merger firm)

The Times investigation found that under Providence’s hand-picked leader, surgeon Jimmy Delashaw, Swedish incentivized doctors to perform as many surgeries as possible and opt for more invasive procedures to maximize profits.

Doctors who challenged Providence St. Joseph’s profit-first agenda faced harsh retribution from management, the paper reported.

In a letter to then Swedish CEO Tony Armada, obtained by the Times, Dr. Charles Cobbs warned that “a culture of intimidation” was pervading the institute. “This toxic, repressive environment has already negatively impacted the ability of the (institute) to provide the quality care to our patients that they deserve,” Cobbs wrote.

Within two years after taking over Swedish, Providence hired Delashaw even though he was facing an internal investigation at his former hospital for high rates of complications and accusations that he performed unnecessary surgeries, the Times reported.

In testimony obtained by the Times, Dr. Hamid Djalilian, a surgeon who worked with Delashaw at UC Irvine, said that Delashaw’s complication rate was “higher than anybody else I’ve ever seen in my life.”

This is not a Democracy

Before long, Providence CEO Rod Hochman promoted Delashaw to lead the institute over the objections of his peers, according to the paper. When one doctor asked Hochman if the surgeons could vote for their next leader, Hochman replied, “This is not a democracy.”

Under Providence, the institute’s Cherry Hill campus saw a 39 percent increase in operating revenue from 2012 to 2015, the paper found. It had the highest Medicare reimbursement per patient of any U.S. hospital with at least 150 beds. But the increased patient volume had ramifications for patients and caregivers:

In benchmarks tracked by the federal government, Cherry Hill was flagged for having high rates of blood clots, collapsed lungs, and serious surgical complications, the paper reported. State data collected by the paper also showed a rise in other problem indicators over the last several years, including aneurysm patients with high numbers of strokes.

Moreover, staffers at the institute told the paper that they were incentivized to pursue a high-volume approach with contracts compensating them for large patient numbers and complicated surgical techniques. To maintain high patient volumes, surgeons performed multiple surgeries at the same time, leaving less experienced doctors handling portions of one procedure while they left to perform another one, the paper reported. Of the six top-producing brain and spine surgeons in Washington state in 2015, five worked at the institute, averaging $67 million in billed charges.

“People are angry”

Delashaw was the institute’s busiest surgeon, the paper reported. In just the first 16 months after his arrival in Seattle, Delashaw handled 661 inpatient cases totaling more than $86 million in billed charges for the hospital — more than any other brain or spine surgeon in the state.

But over that same time, Delashaw faced 49 internal complaints from alarmed staff members concerned about the quality of his patient care and alleging unprofessional behavior, according to the paper’s investigation.

One of Delashaw’s patients at the Institute was Talia Goldenberg, a 23-year-old woman, who the paper reported elected to have a spinal surgery to improve stability in her neck. Goldenberg struggled to breath when she awoke after the surgery and the next day her airway closed up, leaving her comatose. She died on her tenth day in the hospital.

After the Times investigation, Delashaw resigned and temporarily had his medical license suspended. Washington state regulators identified “numerous” patient safety issues at Swedish’s Cherry Hill campus and Swedish’s CEO Tony Armada resigned.

Swedish’s new CEO Guy Hudson told the Times that many Swedish staff members felt intimidation had become a problem and prevented patient care concerns from being addressed.

“People are angry. They are upset,” Hudson said. “It doesn’t seem like we’re the Swedish that we know and love — or knew.”

Adventist is next

If you live in six Northern California counties, now is the time to take urgent action to keep Providence from monopolizing your community hospitals.

California Attorney General Xavier Becerra is reviewing a proposed merger between Providence St. Joseph and Adventist Health. Providence and Adventist would create ST Network, LLC, a company to jointly operate their hospitals and healthcare facilities in Humboldt, Lake, Mendocino, Napa, Solano and Sonoma counties including:

  • Adventist Health Clearlake Hospital, Inc. dba Adventist Health Clear Lake, a 32-bed general acute care hospital, located in Clearlake, CA;
  • Helena Hospital dba Adventist Health St. Helena, a 151-bed general acute care hospital, located in St. Helena, CA;
  • Ukiah Adventist Hospital dba Adventist Health Ukiah Valley, a 68-bed general acute care hospital, located in Ukiah, CA;
  • Willits Hospital, Inc. dba Adventist Health Howard Memorial, a 25-bed general acute care hospital, located in Willits, CA; and
  • Helena Hospital dba Adventist Health Vallejo, a 61-bed acute psychiatric hospital, located in Vallejo, CA.
  • Queen of the Valley Medical Center, a 208-bed general acute care hospital, located in Napa, CA;
  • Santa Rosa Memorial Hospital, a 329-bed general acute care hospital, located in Santa Rosa, CA;
  • Joseph Hospital, a 153-bed general acute care hospital, located in Eureka, CA; and
  • Redwood Memorial Hospital, a 35-bed general acute care hospital, located in Fortuna, CA.

Providence and Adventist claimed that the new entity would provide “improved access to quality healthcare … with a particular emphasis on vulnerable and underserved populations.”

However, given Providence’s failure to live up to its commitment for providing charity care as a condition for state approval of its merger with St. Joseph Health, it’s hard to see Providence St. Joseph prioritizing the needs of low income people in communities served by Adventist hospitals. In fact, the four Providence St. Joseph hospitals that would be part of the Adventist merger fell a combined $3.8 million short of providing the minimum amounts of required charity care in 2017.

We’ve seen what happens when Providence takes over community hospitals. Providence executives rake in cash, while local caregivers lose their jobs, and patients struggle to get care.

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