By Pete Stidman
News Editor

Attorney General Martha Coakley, a former Dorchester resident herself, put neighborhood emotions aside and released a strongly-worded report on the Caritas Christi Healthcare system this morning. Much of the report focuses on the financial crisis facing Carney Hospital, which Coakley characterizes as an institution on the brink of failure without wholesale changes to Caritas' management structure and the mission of Carney itself. The report recommends that Caritas consider transitioning Carney Hospital from an acute care, inpatient facility to one that focuses on psychiatry and substance abuse, while retaining primary, diagnostic and urgent care similar to a community health center.
In a letter summarizing her findings, Coakley wrote that "Carney Hospital has "been in a precarious position for decades" and says that "acute medical-surgical inpatient hospital care may not be the appropriate future for Carney."

At right: Attorney General Martha Coakley

In pointed language, the report also recommends Caritas Christi's Board of Governors be allowed control over day-to-day business decisions, which, according to Coakley, have seen significant interference from the Archdiocese of Boston, the owner of the ailing health care system. Coakley says that church leaders should relinquish all management control over their hospital chain - save for "religious matters" - to the non-profit's board.

"The sense that we have is that the final control [of Caritas] is with the archdiocese. By inference that is the Cardinal, but we're not really clear on how much time he spends looking at Caritas and it's business decisions," she said in an interview today. "I'm not making criticisms of the Archdiocese, but they are not experienced in managing healthcare."

Earlier this year, sources told the Reporter that executives from the system itself, such as interim CEO John Chessare, were not involved in a series of failed merger talks with two other large Catholic hospital chains in 2007.

Coakley said Caritas and the archdiocese were very cooperative with Health Strategies & Solutions Inc., the firm hired to perform the review. The four-month review was prompted last fall by concerns that Caritas, which owns Carney, was not equipped to keep Carney Hospital in good financial health. Another trigger for the probe, Coakley tells the Reporter, was Caritas' failure to hire a permanent executive director last year.

Three other hospitals had a greater inpatient market share than Carney inside its own primary service area, the report said, Boston Medical Center, Quincy Hospital and Brigham and Women's Hospital. From this and other findings, it posits that there is "no shortage" of medical-surgical beds in the area, and the demand for them could be met without the Carney. The Carney's behavioral health services, however, are in demand, it said, and should be retained or even expanded.

"In the long run, if Carney can't raise revenues on its own, the archdiocese won't be able to save it and it will fail," Coakley told the Reporter today. "Essentially, Carney has been subsidized by other sources of financing for a long time. It does not serve anybody's interest to keep it on life support."

Other recommendations in Coakley's report include reducing the focus of St. Elizabeth's Hospital, the chain's flagship, to include two or three major service areas instead of serving all of the chains tertiary care needs; and creating an incentive-based payment system in the Caritas Physician Network similar to those used in other healthcare systems.

Read Attorney General Coakley's letter summarizing the report's findings. PDF 334kb

Read the full "progress report" issued today by the Attorney General. PDF 156 kb