"Hospitals all over are losing money," said Dr. Philip Tally, Manatee Memorial's chief of staff. "The impact of taking care of people for free has hit everybody, and it is affecting not only the financial performance of all hospitals, but this hospital in particular."

The costs of treating the uninsured is the biggest challenge facing any CEO of any health care system, said Gwen MacKenzie, president and chief executive officer of Sarasota Memorial Health Care System.

"The trend we are seeing is more people uninsured and with those who do have insurance, they are having to pay higher deductibles and co-pays," said MacKenzie.

"Many people are opting for catastrophic coverage only," MacKenzie said. "That's very frightening because then they don't seek care until their medical problems become serious."

Hospital staff and doctors were still digesting the surprise announcement made Tuesday that Brian Flynn had resigned as Manatee Memorial's chief executive. Some tied his sudden departure from Manatee Memorial and its new sister hospital, Lakewood Ranch Medical Center, to the worsening indigent care crisis.

Moody L. Chisholm, group director for Universal Health Services Central Region, serving parts of Texas and Oklahoma, has been named Flynn's successor.

Revenue figures for both Manatee Memorial, a for-profit acute care facility owned by Universal Health Services Inc., and Sarasota Memorial, a competing tax-supported public hospital, illustrate the growing burden of indigent care.

In 2004, Manatee Memorial's bad debt equaled $31.4 million and charity care equaled $16.6 million, for a total loss of $48 million, said Vernon DeSear, hospital spokesman.

In 2005, Manatee Memorial's bad debt was $32.6 million and the hospital provided $17.1 million in charity care, for a total loss of $49.7 million, DeSear said.

Manatee Memorial projects its bad debt for 2006 to be $34 million and charity care to top $17 million, for a $51 million loss, according to hospital figures.

Sarasota Memorial's bad debt increased from $42 million in August of 2005 to $59 million in August of 2006, representing a 40 percent increase, said David Verinder, SMH's chief financial officer.

"I didn't have any inkling that Flynn was about to resign," Tally said. "That information was dropped on me at the board of governors' meeting Tuesday."

"The hospital is taking care of patients, as always," said Tally. "The transition is important from a governance perspective, but it doesn't change the day-to-day operation of taking care of patients, which is our mission."

But Tally admitted it is getting harder for the hospital and doctors alike to deliver that care as the numbers of uninsured and indigent continue to rise.

But some specialists have already quit Manatee Memorial rather than bear the liability risk that comes with required on-call duty in the emergency room.

Manatee Memorial's medical staff at their annual meeting on Nov. 28 will consider a possible change in bylaws to drop on-call duty in the emergency room as a requirement for physician privileges at the hospital, Tally said.

"We have agreed to debate the issue," Tally said. "The staff has the ability to control its own bylaws and if they choose to change their bylaws, it is within their right to do so."

Tally is one of a growing number of health care practitioners who believe a special taxing district may provide a revenue stream for caring for indigents.

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