By Pete Stidman
News Editor

Patients feared the worst after a front page headline in the Boston Globe last Wednesday announced that the Caritas Carney Hospital might be "sold or shuttered." The hospital phone lines lit up with hundreds of worried calls. The influx forced the hospital to distribute a "Talking Points" handout to staff, instructing them to tell everyone: "There are NO plans to close Carney Hospital."

But, perhaps surprisingly, staff morale seems to be a notch higher this week.

"I think that this Globe thing is going to be good for Carney in the long run," said Dr. Jeffrey Papma, director of invasive cardiovascular services. Papma previously worked at Brigham and Women's Hospital for eight years, and now works for Caritas Christi Health Care, spending one day a week at the Carney. "When you read the stuff in the Globe, you might think you're not going to have a job in four weeks. But I haven't heard any rumbling, other than to fix a problem. One of the things that I think is right for my soul is making sure that this hospital stays around for the people who need its services."

"I don't think we're in any danger of closing," agreed Dr. David Lustbader, Carney's chief of medical staff. "The article was a little disingenuous in that the headline didn't really match what the body of the article said."

Margaret Carr, Carney's spokesperson, said the reported internal document was part of a budget report, and other administration sources confirmed that Caritas Christi had told the document's creators to outline every option that could potentially solve the chain's financial problems.

"The good thing is, people are now talking about how the Carney can fit into the healthcare system," said Bill Walczak.

Last Friday, City Council President Maureen Feeney organized a meeting of Dorchester elected officials at the Ashmont Grill on Talbot Avenue. According to Lustbader, state and federal legislators present divvied up tasks like looking into "unfair payment practices" from private insurance companies and federally mandated programs, which often compensate hospitals with deeper levels of service at higher rates for the same procedures than they do smaller facilities such as Carney. The meeting included Congressmen Michael Capuano and Stephen Lynch, state Reps Linda Dorcena Forry and Martin Walsh, and state Sen. Jack Hart.

"For right now this is a fact-finding, info-sharing collaboration," said Feeney. "We hope that we can evaluate all the things we can do to help this hospital stay in our community."

"I personally don't have faith in the Archdiocese to get the Carney out of the problems they're having," said Walsh. "We have to come up with a way of making the Carney viable."

Another idea reportedly included in the document, selling the Carney to another hospital chain, appeals to just about everyone involved, especially if it's a chain with money to invest.

"I can tell you the staff would probably be happy if we were sold, but I don't see that happening anytime soon," said Lustbader. "We're in a catch-22 where [officials at the Archdiocese-run Caritas Christi system] don't have the money to fix us, but they don't want to sell us either. Normally, a hospital would have a $10 to $15 million investment every year. We've had no significant influx of capital, other than a little bit last year. We're hoping for a $40 or $50 million investment, and the Archdiocese just isn't going to do that."

"There's a lot of rumors out there that we'd dump it and sell it to the highest bidder, and that's just not the case," said Archdiocese spokesperson Terrence Donilon on Monday. Later, in an e-mail, he added: "Right now we are focused on hiring a permanent CEO who can lead the system and who will, working with the boards in building on the system's current strengths, develop a strong strategic direction for Caritas Christi Health Care over the next months and years." Caritas has been without a permanent chief executive since May of 2006, when Robert M. Haddad resigned amidst allegations of sexual harassment, and many within Carney believe that the vacuum at the top has put less experienced church officials in more control of health-related decisions at a time when - with school closings and other major decisions pending - there are simply too many pressing matters for them to consider at once.

A case in point is Massachusetts' conversion to universal health care, which is tugging at the bottom line because the hospital's payer mix includes so many patients who still depend on the Uncompensated Care Pool, and haven't yet gotten insurance through the Health Connector. Around $6 million in annual state funding that traditionally came from the pool to the Carney has been cut in half, said Lustbader.

"One faucet was turned off, and another one wasn't fully turned on yet," said Lustbader. "Carney really depended on that more than other hospitals."

Another Carney trouble that legislators are now investigating is the different reimbursement rates insurance companies and federal agencies pay for providing the same services. Anyone might see the discrepancy as unfair at first glance. But Dorchester's own Jim Hunt Jr. of the Massachusetts League of Health Centers warns against oversimplifying the matter.

Reimbursement rates take into account the depth of service offered at a particular facility, said Hunt. For instance, the difference between the services that could be provided by a state of the art Neonatal Intensive Care Unit (NICU) or by an Obstetrics/Gynecology practice. The overhead investment in the first is far greater than the latter, even though both perform certain services equally.

There is yet another layer of complication that Walczak and Carney president Daniel O'Leary have touched upon in previous interviews. If, for example, an obstetrics practice can perform the service cheaper, shouldn't there be a patient incentive to go there? In today's healthcare system, patients rarely price shop

And, if building and running an intensive care unit for infants is more profitable than an obstetrics practice, the overall system runs the risk of overbuilding its healthcare infrastructure.

"It's true that we have big, giant systems," said Hunt. "It's true that we need to save the small systems. But I would prefer maximizing cooperations."

Most observers share that idea as well. In the 1970s, the Carney helped to establish a network of health centers in the neighborhood- among them, Neponset, Mattapan, Bowdoin Street, and Codman Square- prior to entering the Caritas Christi chain, but over time could not afford the financial support needed to maintain affiliation with them. Now, many of them have struck deals with other hospital chains, but not all of those deals are exclusive. Health centers could be a rich source of specialist referrals.

"It's a dialogue that needs to occur and hasn't yet," said Hunt. "There are probably 10 health centers that provide services to Dorchester residents. Some are deeply connected to the Carney and some are not."

Next week, Carney employees will don Red Sox gear and attend forums with the team theme on a new Caritas Christi initiative called Achieving Exceptional Care. They don't seem to be jumping ship.

"I've been here for 18 years and all along there's been rumors the place is closing," said Lustbader. "We exceed every quality indicator for just about every hospital in Boston. We just don't have as many bells and whistles as other hospitals. Unfortunately that affects patient choice. It's very hard to compete in this kind of environment."