Syracuse’s state senators want Upstate, Crouse to lift secrecy surrounding hospital merger

Syracuse, N.Y. – Central New York’s two state senators are calling on SUNY Upstate University Hospital and Crouse Hospital to lift the veil of secrecy surrounding their proposed merger.

“People want transparency from a state hospital,” said Sen. John Mannion, D-Geddes. “They want to know what’s going on. It should be transparent and public because it would have such a big public impact.”

Upstate, a state-owned taxpayer-supported hospital, asked the state Health Department in April for permission to acquire Crouse, an independent nonprofit hospital next door. If the deal is approved, Upstate would amass a 71% share of the Syracuse hospital market, bring in more than $2.3 billion in annual revenue and employ about 13,000 people. Upstate is already the largest employer in the Syracuse area.

Since announcing the deal in April, hospital officials have repeatedly refused to answer questions about the proposal which is under review by the state Health Department. The financial terms of the deal have not been disclosed nor have the hospitals said if taxpayer dollars will be used to help pay for it.

Syracuse’ other senator, Rachel May, is considering holding a public forum on the merger in response to reporting by syracuse.com | The Post-Standard about the secrecy surrounding the merger.

May said hospital officials told her they were advised by their lawyers not to answer questions about the proposal.

“I am sure there are a lot of things that have to get ironed out and it’s harder to reach an agreement if it’s all public,” May said. “But I also think people have legitimate questions that need to be aired.”

May said she would like citizens to have an opportunity to ask questions about the proposal at a public forum, even if hospital officials refuse to participate.

Research shows hospital mergers often lead to higher patient prices without improving the quality of care. When Upstate and Crouse announced the proposal they said in a prepared statement the merger would lower costs and improve care, but never explained how that would be accomplished.

May said she’s not opposed to the merger in principal because she worries about Crouse’s financial health.

Stabilizing Crouse’s finances appears to be a major goal of the merger. Crouse posted losses of nearly $12 million in the three-year period of 2016 through 2018. It asked the federal government in 2020 to take over its employee pension plan which was underfunded by $104 million. The hospital finished 2020 with a surplus of about $9 million thanks to an infusion of federal pandemic relief.

“I totally understand the fear this consolidation will reduce competition in our health care market,” May said. “But I think having one hospital go under would be even worse for our community.”

Mannion said even before the Upstate-Crouse deal was announced he and other state legislators were concerned about the lack of transparency in the process the state uses to review hospital mergers. The state does not require public hearings as part of its review.

Mannion said that’s why he and other legislators approved a bill that requires hospitals proposing mergers to obtain independent assessments showing how the changes will affect low-income, racial and ethnic minorities and other vulnerable consumers. Gov. Kathy Hochul recently signed the bill into law, but it don’t take effect until 2023.

Mannion said the proposed Upstate-Crouse hospital merger “needs to be transparent, well researched and thought out.”