About the Public Hospital Accountability Act of 2008

Posted on August 14, 2007

Senator David Shafer (R-Duluth) has announced plans to introduce the Public Hospital Accountability Act of 2008 in the next session of the General Assembly.  He is circulating a draft of the proposed legislation among members of the General Assembly.  He has also released a draft to the public for comment. 

Grady Hospital

Public hospitals in large urban areas have faced great challenges, some more successfully than others.  Grady Hospital and the Grady Health System have experienced years of management problems and  financial losses, jeopardizing its continued operation.

Grady has the only Level One trauma center in Georgia north of Macon.  It houses the Poison Control Center for Georgia and has top notch units for burns, intensive neonatal care and sickle cell anemia.  Grady has served as the training ground for 1 in 4 of Georgia’s practicing physicians and provides care to over 1 million patients annually.  Its loss would be a disaster for metro Atlanta.

Grady is operated by the Fulton-DeKalb Hospital Authority, a political entity created under Georgia’s Hospital Authorities Law and controlled by Fulton and DeKalb Counties.  Unlike every other county hospital authority in metro Atlanta, and virtually every other hospital authority in the country that serves a large urban area, the Fulton-DeKalb Hospital Authority directly manages its hospitals.

Other county hospital authorities have formed nonprofit corporations to manage their hospitals on a day-to-day basis.  Federal law allows nonprofit corporations greater flexibility in the operation of hospitals, and the nonprofit governance model is almost universally recognized as the most efficient way for urban public hospitals to be operated.

Lieutenant Governor Casey Cagle, the Metro Atlanta Chamber of Commerce and The Atlanta Journal-Constitution are among those urging the Fulton-DeKalb Hospital Authority to restructure its operations using a nonprofit hospital management corporation.

The Public Hospital Accountability Act of 2008 would require county hospital authorities operating hospitals above a certain bed capacity to delegate day-to-day management to a nonprofit corporation.  It provides for the formation of the nonprofit hospital management corporation and adopts standards of governance.

The bill does not provide state funding for Grady or any other public hospital.  The bill is not advertised as a comprehensive solution to Grady’s many problems.  But in the words of its sponsor, Senator Shafer, ” it is a necessary first step.”