The Grave Situation at Atlanta's Grady Memorial

On the board of directors of a health or social service organization? If so, Atlanta’s Grady Memorial Hospital situation is a cautionary tale. A court ruled on September 25th that Grady Memorial—Atlanta's safety net hospital—could close its outpatient dialysis unit. What brought the Grady management team to the place where courts are ruling on its service lines? Consumer desperation, of course.

Grady accepts all patients despite immigration status or ability to pay, and is the ‘last resort’ provider for many uninsured, according to a recent New York Times article. Unfortunately, Grady’s dialysis clinic was projected to lose $2 million this year, and continuing dialysis services was deemed unfeasible. This prompted a lawsuit asking for consumer relief.

The patients’ lawyer, Lindsay R. Jones, called the order Friday by Judge Ural D. Glanville “an angry, punitive decision.” “At least 51 patients had their life support system unplugged today under the authorization of this judge,” Mr. Jones said. In response to the decision, Grady has agreed to pay for up to three months of dialysis at private clinics for the 51 displaced patients. However, the clinic will still close.

The Grady situation is just the first of hundreds of similar situations we are likely to see. The combination of state and local budget deficits—coupled with a likely new range of payer-level health care cost containment measures—will increase pressure on non-profit provider organizations to continue unfunded services.

And don't expect relief from the courts. One quote from Judge Glanville says it all: “As it relates to the receipt of medical treatment, the court is unpersuaded [sic] at this time that plaintiffs have a constitutional right to the sought-after relief."

Word of advice: Understand the cost structure for each service you deliver. Be proactive in seeking additional funding where needed—or in closing those programs you can't afford to continue.