Ryerson v. Welsh: The Debate Over the Wishard Referendum

The Indianapolis Star this weekend had an interesting op-ed piece written by Indianapolis Star editor Dennis Ryerson. The piece is an obvious retort to Gary Welsh's Advance Indiana blog entry where he said Ryerson was lying in an earlier editorial supporting the Wishard Hospital. Welsh has since written a reply to the Ryerson response.

While I would not have chosen the words Gary did, his criticism of the Star's endorsement of this venture is right on the mark. In short, the Star seems to be more than willing to ignore the questionable "how" Health & Hospital Corporation officials are going about this referendum because it is perceived as being for a good cause. Consider the following:

• The Star's editorial ignored the biased referendum question that fails to even mention building a new hospital or how much the HHC would be borrowing to pay for it. Doesn't the Star's editorial board feel voters have the right to this information when they are voting? Doesn't the Star believe this will set a troubling precedent for referendums in the future?
• The Wishard referendum was slipped into the budget bill during the special session. It could have easily been introduced at any time during the 2009 legislative session as a separate measure. HHC's lobbyists chose the budget bill though so the issue would fly under the radar. I'm told HHC lobbyists even tried to bypass the referendum process all together, but Senate Finance Chairman Luke Kenley insisted they at least do a referendum for the billion dollar project. (It will be a billion dollars once the loan with interest is paid back.)
• Does the Star not have a problem with them setting the referendum during a non-election year when the average voter will be at home? In Ryerson's response, he expresses concern that the off-year election will help a small minority of people defeat the referendum. That's utter nonsense. The HHC lobbyists know perfectly well that the low turnout in a non-election year greatly helps those who favor the Wishard referendum. The polls will be dominated by people who work at Wishard or have families members or friends who work at Wishard. This referendum could have easily been pushed back to May or November 2010 when the average voter could be heard at the polls. That's the last thing HHC wanted.
• The Star editorial board seemed to take it for granted that no property taxes will be used. But property taxes back the bonds up. The only thing preventing the use of tax dollars to pay the bonds is the naked promise of HHC executive Matt Gutwein that taxes won't be used and the income scheme HHC has concocted where they get revenue from nursing homes purchased all throughout the state. The Star's only response is that the Indianapolis Chamber of Commerce has been convinced and therefore taxpayers should not be concerned. The Chamber though has supported every local tax increase this past decade. Its track record is not good.
• Probably the most troubling omission in the Star editorial and Ryerson's response is that the HHC income stream to pay for the bonds is built on a scheme whereby HHC acquires and then enters into leasing agreements with nursing homes throughout the state which allows HHC to claim twice as much Medicaid revenue per patient. It is a scheme very similar to that used by St. Francis Hospital in Indianapolis, one that resulted in an agreement with the Justice Department to pay back millions to the federal government. The fact that HHC of Marion County is making a bundle on nursing homes throughout the state, even though it had never previously been in the business, should raise major red flags with the Star's editors. But it doesn't. Gutwein has been upfront about the fact that the sole reason HHC can pay for the hospital out of revenue is the nursing home Medicaid scheme. If that revenue goes away and/or the feds bust the scheme (both of which are major possibilities) taxpayers are on the hook for the hospital with their property taxes.

While one can criticize Gary Welsh for using too strong of a language to describe Ryerson and the Star editorial, his arguments are absolutely right. The Star's editorial board needed to show more diligence before writing such an editorial. The public deserves the facts in the Wishard debate and they aren't getting them from the State's largest newspaper.