Hartford Business Journal

18 Hartford Business Journal • March 23, 2020 • www.HartfordBusiness.com By Matt Pilon mpilon@hartfordbusiness.com P roxy wars are often fought between nation states, but one is brewing between Hartford's two largest health systems. The direct battle involves one of Connecticut's largest radiology groups, which is fighting through the state's regulatory process to block a competitor's bid to expand on its coveted Bloomfield turf. Hartford HealthCare (HHC) and Trinity Health Of New England are closely tied to the groups, Jefferson Radiology and Radiology Associates of Hartford, through contracts or ownership stakes. HHC owns a 49% stake in Jefferson, which has numerous Greater Hart- ford locations, through a longstand- ing joint venture that has grown in re- cent years, while the physician-owned Radiology Associates bills itself as an exclusive radiology provider to three Trinity-owned hospitals, including its flagship St. Francis Hospital and Medical Center in Hartford's Asylum Hill neighborhood. Jefferson is trying to block Radiol- ogy Associates from opening a new imaging facility in Bloomfield, and from changing its legal structure to allow for future expansion. Jefferson says its involvement has nothing to do with competition. In- stead it says it's trying to make sure the state uni- formly enforces its own complex set of regula- tory standards that govern new equipment purchases and aim to ensure the healthcare system doesn't build up costly excess capacity. The spat comes amid intense compe- tition in Connecticut's healthcare industry, as hospitals and other pro- viders try to keep and grow market share. HHC and Trinity are among a hand- ful of regional or statewide hospital systems that have either formed or grown larger through a wave of ac- quisitions and consolidation over the past decade, and their radiology part- ners want to grow alongside them. Some industry observers say such fights are an example of how health- care providers try to use the state's regulatory process to chase or stay ahead of competitors. "It's not necessarily about improv- ing care or about making care less costly," said Dr. Steven Levine, a Trumbull-based ear, nose and throat physician with no ties to the regula- tory fight in question. "Entities tend to try to protect their turf." Making the case Similar disputes over market or equipment expansions have taken place between healthcare providers in recent years, and typically neither side talks much, or at all, about com- petition or market share. Instead, opponents craft arguments seeking to prove that there isn't a pub- lic need for a new service in a particular area, or that a transaction wouldn't be financially viable, or would fail to im- prove care quality, accessibility or cost. Those are key metrics the state's Office of Health Strategy (OHS) uses to decide whether to grant a so-called "certificate of need," which providers must get in a variety of situations, like when they want to purchase a new MRI scanner, or acquire another group or hospital. Radiology Associates has ar- gued that OHS should approve its $2.9-million purchase of MRI and CT scanners for a new facility in Bloomfield. The group, which as a professional corporation must be owned by physicians, is also seeking permis- sion to transfer ownership of the new equipment, as well as exist- ing scanners it operates in Enfield, Glastonbury and Avon, into a newly formed entity, Eastern Radiology Associates LLC. The change in legal structure would mean hospitals and other providers could invest in the company to fuel future growth. Jefferson President Dr. Ethan Fox- man has sought to pick apart portions of Radiology Associates' application as misleading or inaccurate, urging OHS to deny the entire application. For example, Foxman challenged which towns the group selected to comprise its proposed Bloomfield facility service area, and charged it had not included some other area scanners when determining equip- ment capacity. Radiology Associates, which sought unsuccessfully to block Jef- ferson's involvement in the proceed- ing, has pushed back against Fox- man's claims, calling his testimony "riddled with so many misstate- ments and overstatements." Dr. Michael Twohig, Radiology Associates' president and chair of radiology at St. Francis Hospital, declined comment for this story. The stakes are relatively high, as the outcome could grant or deny Twohig's group an additional $1 mil- lion to $2 million in annual operat- ing revenue, some of which could come from patients poached from Jefferson's Bloomfield operation. PHOTO | BOKSKAPET, PIXABAY Proxy War Greater Hartford radiology groups duel over expansion plans When Connecticut healthcare providers want to purchase or transfer an MRI or CT scanner, the state has complex rules for determining whether there is a public need for it, which sometimes leads competitors to square off. Hartford Hospital owns a 49% stake in Jefferson Radiology, which is trying to block Radiology of Associates' expansion. Jefferson Radiology has several Greater Hartford offices including this one in Farmington. HBJ PHOTO |GREG BORDONARO PHOTO | HBJ FILE

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