Deputy Mayor for the District of Columbia Health and Human Services Wayne Turnage says the executive intends to deliver a final agreement for the new hospital to the Council in “early 2020” for review and approval—nothing, including a recent lawsuit that involves its negotiating partner—has changed that.     

“We are still working aggressively try to secure a greater health care system for the people of Ward 8,” Turnage tells City Desk. “Nothing has deterred us from that effort at this point.” 

On Dec. 6, George Washington University filed a lawsuit in D.C. Superior Court alleging that its operator, Universal Health Services (UHS), misappropriated over $100 million from its hospital. UHS owns 80 percent of the hospital’s equity in partnership with the GWU. The news was first reported by the Washington Post.  

“[W]hile the hospital and the for-profit UHS are virtually printing money, the Medical School and [Medical Faculty Associates] are struggling financially, and rely upon cross-subsidies from larger University operations and resources for their survival. UHS created this disparity by diverting money that rightfully belongs to the University, MFA, and the community,” the lawsuit says.  

“Instead of investing sufficient Hospital revenues in the University’s research and teaching missions—as UHS and [District Hospital Partners] committed to do when UHS and the University created the Partnership—UHS has paid itself these funds in the form of outsized dividends from artificially inflated, excess profits.”  

UHS is an owner and operator of mostly community hospitals and behavioral health facilities, and currently is in negotiations with Mayor Muriel Bowser‘s administration as D.C. strives to create a new hospital in Southeast D.C. The new hospital, which is expected to be built on the St. Elizabeths Campus in Congress Heights, is replacing the only hospital east of the Anacostia River, United Medical Center. UMC is scheduled to close after the new hospital is built.     

According to Turnage, the lawsuit hasn’t changed negotiations between the mayor’s office, GWUH and UHS. “We have no comment on the lawsuit,” he tells City Desk, nor does it “implicate any decisions we are having.” Additionally, Turnage says the District does not get involved in the partnership between UHS and GWU hospital.

In a letter dated Nov. 26 to At-Large Councilmember Elissa Silverman, who inquired about the status of negotiations after a discouraging oversight hearing in late October, Turnage said: “The parties—[meaning, the District and UHS/GWU]—have made significant progress towards a final agreement and we would expect to provide it to Council for their consideration in early 2020.”

Silverman asked Turnage if D.C. will have an open and operational hospital by the targeted deadline, 2023. To this, he simply replied: “We remain committed to opening a new hospital as soon as practical, recognizing that regulatory and legislative approvals still need to be obtained.” 

She also asked if there were any “outstanding issues,” because there should have been an agreement already for the Council to review.

“There are no outstanding issues that we believe will prevent the parties from finding common ground; however, the District is taking the time it believes is necessary to ensure that the agreement is in the best interests of District residents now and in the future,” wrote Turnage.

The final agreement is likely to take the form of a contract, which will go before the Council for a vote. The lawsuit against UHS could set back the new hospital if enough lawmakers disapprove. 

“[W]e are concerned that the GW/UHS lawsuit raises questions about both the negotiations and UHS’ fitness for running the new hospital. We’re reviewing the suit now,” Silverman’s chief of staff tells City Desk in an email.  

Ward 7 Councilmember Vince Gray, who chairs the health committee and been leading the push for a new hospital, told the Post he couldn’t predict the lawsuit’s effect on the new hospital. “I’m going to continue to monitor this as closely as I possibly can,” Gray said. “I think we’re poised and ready to go forward, and I think that’s what we should do at this stage. I suppose anything could happen, but I’m hopeful that we can keep our eyes on what’s most important here.”

Others besides Silverman have questioned UHS’ suitability, including the D.C. Nurses Association, a union that represents UMC nurses. 

“There’s another reason why the District should really consider our request and the request of the residents and look for a new operator,” says Wala Blegay, an attorney for DCNA. “At this point, there is no purpose of rushing this process.”

She cites a recent National Labor Relations Board decision that says UHC/GWUH broke the law by engaging in regressive bargaining with unionized workers, along with a Department of Justice $127 million settlement over a false billing claims investigation. 

“It is worth looking and properly strategizing for an effective hospital—a hospital that meets the needs of the community. And at this point, I mean, they’re negotiating something in the darkness,” she adds. 

The letter addressed to Silverman confirmed DCNA suspicions about the status of negotiations, says Blegay. “The fact that they’ve been steadily meeting for the last five months, the fact that there is no deadline at this point—all of those things are new to me,” says Blegay.