New Mexico Attorney General Raul Torrez discusses the relationship between public safety, mental health and adverse experiences for children during a press conference following a summit in Albuquerque, New Mexico, Friday, Nov. 3, 2023.
Susan Montoya Bryan | AP
New Mexico's attorney general on Tuesday announced an investigation into Memorial Medical Center, a Las Cruces hospital operated by Lifepoint Health, to determine whether the facility, highlighted in a recent NBC News report, violated state laws by turning away indigent and low-income patients seeking care.
Attorney General Raul Torres said his office is examining Memorial Hospital's patient policies to ensure they comply with state law and the hospital's performance under New Mexico law governing the provision of care to needy patients.
At a news conference announcing the investigation Tuesday, Torres said he had just met with patients, as well as providers at Memorial, to discuss their concerns.
“It is clear to me that the management of this facility failed to put the safety and well-being of its patients and their care in the right place and in the right priority,” he said. “It is clear to me that decisions were made from a perspective that appears to be driven by profit, by maximizing profit, and without due respect and consideration for the patients in their care.” He also warned the hospital management of retaliation against anyone who speaks out about its practices.
Last month, an NBC News report described allegations that Memorial Medical Center had turned away cancer patients operated by LifePoint Health, which was acquired by Apollo Global Management, a New York-based private equity firm. Doctor records and interviews with 13 patients show the hospital had refused care or required them to pay upfront to secure treatments.
Barbara Quarrel, a former Memorial Hospital nurse, said the hospital denied her treatment after she was diagnosed with cancer in 2022. She told her story in the attorney general’s announcement.
Quarrel told NBC News she was encouraged by the attorney general's investigation. “It's about time. At Memorial, it's all about the money; it's not about the patients anymore. Why are they in health care if it's not about the patients?”
In a statement, a hospital spokeswoman said, “Memorial Medical Center was surprised to learn of this investigation by Attorney General Torrez during his press conference today. We remain committed to expanding access to health care and being a good partner to the community in Las Cruces and Doña Ana County and will fully cooperate with this investigation.”
Before the report was published and aired in June, Memorial told NBC News it was not denying care, but two of its top officials called to apologize to two patients who told NBC News they were denied care.
An Apollo spokeswoman did not respond to an email seeking comment.
Lifepoint Health, which operates Memorial Hospital, oversees the nation’s largest chain of mostly rural hospitals — 62 acute care facilities in 16 states. NBC News reported that Lifepoint is the subject of two U.S. Senate investigations, along with other private equity-owned health care companies. The investigations are looking into the profits Apollo and other companies made from the deals and whether they harmed patients and doctors. Apollo said it is cooperating with the investigations.
Although Lifepoint operates Memorial Hospital, the facility and the land it sits on are owned by the city of Las Cruces and Doña Ana County. Denying patients health care would violate a 40-year lease that Memorial entered into with the county and city in 2004. The lease states that the facility must generally continue to provide care “to those who are unable to pay the full cost of health care services.”
About 225,000 people live in Doña Ana County, the urban and rural area served by Memorial, and about 15 percent of them are uninsured, according to the latest census figures. About 23 percent of the county’s residents live in poverty, compared with about 11.5 percent nationwide.
Torres said one focus of the state investigation is whether Memorial Hospital mishandled health care services for patients in need. “Providing care to all of our neighbors, regardless of their ability to pay, is the foundation of our mission and our commitment to our community,” the hospital’s most recent annual report to the community said.
Torres is also investigating whether Memorial violated a New Mexico law governing patient financial assistance programs. The Patient Debt Collection Protection Act requires hospitals to screen for financial assistance, he said, adding that “patients being turned away without screening are a violation of the law.” Some patients interviewed by NBC News for the June report described being denied care without being screened to determine whether they could qualify for financial assistance.
Memorial Medical Center in Las Cruces, New Mexico
Paul Rathge for NBC News
Before 2004, Memorial operated as a nonprofit community hospital. Under LifePoint, Memorial has become a for-profit, and highly profitable, entity. It charged 6.7 times what it costs to care in 2021, according to the most recent figures available from the Centers for Medicare & Medicaid Services, or CMS. The average charge among for-profit hospitals nationwide is less than five times what it costs, according to Jie Bai, a professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health, based in Washington, D.C.
The CMS hospital comparison site confirms that Memorial's Medicare costs per beneficiary are higher than the national average and about 20% higher than the state average.
Yolanda Diaz is a patient advocate for CARE Las Cruces, a nonprofit she founded to help needy patients pay for health care and expenses. Diaz has been notifying county and city officials since 2021 that Memorial Hospital was turning away patients, a practice she said she found inhumane and unfair.
“I am disappointed that no one in Las Cruces and Doña Ana County leadership has stepped forward to take action, but I have hope,” Diaz said in an email. “I believe that the New Mexico Department of Justice launching a formal investigation is the best course of action and I hope that the facts will be revealed to the public, and that change and justice will be brought about.”
Hospital documents obtained under open records requests show that Memorial’s written care policy for years directed it to provide care to patients who couldn’t afford the full cost of their treatments and discussed discounts or cost-sharing arrangements for people who met income criteria. That changed last year, the records show, five years after LifePoint was bought by Apollo, a private equity giant co-founded by Leon Black.
Private equity firms like Apollo have taken over a large chunk of the health care industry in recent years. These firms typically load up on the companies they buy, then cut costs to boost profits and attract potential buyers later. Nearly a quarter of New Mexico’s hospitals are controlled by private equity firms, according to a study by the Private Equity Stakeholder Project, a nonprofit that analyzes the private equity industry’s impact on consumers.
The lobbying group for private equity firms says the industry improves health care. But independent academic studies show that private equity firms’ involvement in the industry leads to significant cost increases for patients and payers, such as Medicare. Research shows that lower quality of care is associated with corporate investment in health care, including a 10 percent higher mortality rate in private equity-owned nursing homes and increased incidence of infections, blood clots and falls in hospitals.
