Analysis Health Systems

Will a Catholic Hospital Merger Gut Health Care in Gary, Indiana?

Amy Littlefield

Methodist Hospitals runs Gary’s only hospital. If it merges with Franciscan Health, Methodist’s CEO says it will follow Catholic directives that some worry will gut access to reproductive health care for a vulnerable population.

To Rev. Marie Siroky, the sulfurous stench of the steel mill in Gary, Indiana, smells like childhood. Those were the city’s glory days, when the smell was so thick you could taste it, when the red dust from the mills coated the cars.

“Whew! It is good today! This is what it was like growing up,” Siroky whooped, bumping and rumbling over potholes as she took me on a driving tour of her hometown.

Since Gary’s heyday in the 1960s, its population has dropped from about 180,000 to fewer than 80,000, gutted by white flight and the decline of the steel industry. Now, occupied homes alternate with abandoned ones: a house-by-house patchwork of decay and survival. But Siroky’s love for Gary stems not so much from nostalgia as solidarity with the people who still live here.

“That’s the spirit of the region: There are still people who love it. We know it sucks, we know it’s falling apart, but dang it, it’s our home, and they’re gonna pull each other up,” Siroky declared, at times taking her hands off the steering wheel to gesture around her.

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There are many battles to be fought here, and Siroky, a 58-year-old former nun, is involved in a lot of them: cleaning up old buildings, investigating police shootings, protesting deportations. But the concern that has absorbed her lately is the fate of Methodist Hospitals, the health system where she works as a chaplain, if it follows through on plans to merge with a Catholic health-care giant.

Methodist runs Gary’s only hospital, along with another in neighboring Merrillville, and multiple physician clinics in the region. If it merges with Franciscan Health, Methodist’s CEO has told a local radio station it will follow directives from the U.S. Conference of Catholic Bishops, which forbid most forms of contraception, sterilization, abortion, certain fertility treatments, and restrict end-of-life care. Health-care providers have cited the directives to deny care to transgender people, patients in the process of miscarrying, and even a bleeding woman with a dislodged IUD.

“It is substandard care, because you’re not giving people all of their choices,” Siroky said. “I respect religious polity and doctrines of the church. Those are yours, and I respect them. But when you force them on someone else, that is where, to me, where it becomes unjust and immoral.”

Siroky and other advocates worry that these restrictions would hit Gary, where 37 percent of residents live in poverty, particularly hard. From the Gary hospital, it takes about 20 minutes to get to the nearest non-Catholic hospital by car—potentially much longer for the many residents who rely on buses. The impact would be even broader if the directives extend to Methodist’s physician clinics.

“Given the fact that there is very limited intercity transportation, we have a lot of marginalized people living in Gary—in the region period, but particularly in Gary—who would suffer as a result of the Catholic ethics that say that you cannot get any form of birth control,” Rev. Dena Holland-Neal, associate pastor at Trinity United Church of Christ in Gary, told Rewire.

On top of that, Franciscan would impose its religious directives on many patients who follow other religions, noted Holland-Neal.

In general, Holland-Neal said, Gary is “not a Catholic community, so we should not have to abide by the Catholic religion.”

“Impermissible Material Cooperation With Evil”

Catholic health systems like Franciscan have broadened their hold on an increasingly consolidated health-care landscape, with one in six acute-care hospital beds nationwide and about one in four in Indiana now subject to Catholic directives. In many places, these hospitals are the only accessible option; nationwide, at least 46 are designated “sole community hospitals” for their region, generally defined as being at least 35 miles away from other hospitals.

The American Civil Liberties Union has sued Catholic hospitals on behalf of patients denied care for miscarriages and gender-affirming surgery. But the Trump administration appears poised to roll back the Obama administration’s protections for transgender patients and reproductive care, giving these hospitals broader legal cover to deny basic services to employees and patients alike. Trump’s May 4 executive order sets the stage for this expansion of corporate religious rights.

If they continue to grow, “Catholic hospitals will become the main option for more and more people, and those people have fewer and fewer protections for their health and safety when they visit those hospitals,” attorney Greg Lipper, formerly of Americans United for Separation of Church and State, told Rewire in an interview.

This trend did not come out of nowhere. For years, religiously affiliated corporations have waged a coordinated legal campaign against government regulations, even going so far as to argue before the U.S. Supreme Court that their religious beliefs should allow them to underfund their employee pension plans. But in recent years these organizations have focused on dismantling the Obama administration’s protections for women and transgender patients.

The company now eyeing Gary’s only hospital has played a key role in these attacks.

Franciscan Health is one of the largest Catholic health systems in the Midwest, with 14 hospitals and a network of more than 750 physicians. Each year, it reaps more than $900 million in taxpayer funding, mostly for providing Medicaid and Medicare services.

But on the national stage, Franciscan has been at the forefront of attacks on nondiscrimination provisions enshrined in the Affordable Care Act (ACA). In a lawsuit filed last year under the company’s old name, Franciscan Alliance v. Burwell, attorneys claimed that requiring Franciscan to provide gender-affirming care under the ACA’s Section 1557—which forbids sex-based discrimination in all health-care programs and activities by any entity receiving federal funds—would violate the company’s religious beliefs.

“Like the Catholic Church it serves, Franciscan believes that a person’s sex is ascertained biologically, and not by one’s beliefs, desires, or feelings,” attorneys from the Becket Fund for Religious Liberty wrote.

The complaint also argues that the Section 1557 protections threaten Franciscan’s right to exclude abortions, sterilizations, and gender-affirming care from employees’ health insurance.

“Franciscan sincerely believes that providing insurance coverage for gender transition, sterilization, and abortion would constitute impermissible material cooperation with evil,” attorneys wrote.

A federal judge ruled in Franciscan’s favor in December, halting the protections. Now, the Trump administration appears poised to gut them.

Franciscan also refuses to cover contraceptives in its benefits plans for about 15,000 eligible employees, according to a complaint filed in opposition to the Obama administration’s requirement that most employer-provided health plans cover birth control. Here, again, Franciscan is likely to get its way from the Trump administration.

Franciscan did not respond to multiple requests for an interview or comment by deadline.

What’s at Stake in Gary?

Franciscan’s proposed merger with Methodist takes place against the backdrop of decades of racial discrimination that have shaped Gary’s health-care landscape. In the 1970s, it became very obvious that Methodist Hospitals was shifting operations away from the Gary hospital to its new campus in the whiter town of Merrillville, said Indiana State Rep. Charlie Brown (D-Gary).

Richard Hatcher, then the mayor of Gary, and others filed a civil rights lawsuit, resulting in a 1979 federal consent decree requiring Methodist to maintain a level of service parity between the two hospitals.

Now, a key question is how the proposed merger would affect the consent decree.

Franciscan has proposed ending the decree in exchange for building a new hospital, according to local news reports. Rep. Brown told Rewire that Methodist has already approached him, along with Mayor Hatcher and current Gary Mayor Karen Freeman-Wilson, about signing off on a request to federal regulators to modify the consent decree.

“I think Methodist and the Franciscans are hoping that there would be a sunset on the consent decree,” Brown said in an interview this month, adding that he does “not necessarily agree … that we should eliminate it altogether until we look to the future and see what will happen with medical services here in the city of Gary.”

While the medical landscape may have changed, the racial divide between Gary and Merrillville remains: Gary is 85 percent Black, while Merrillville is 46 percent white.

“If there is a merger, if there is a purchase, whatever the modification is, it has to be consistent with the terms of the consent decree,” Freeman-Wilson told Rewire. At the same time, she said, “There wouldn’t be a sale or a merger with a consent decree that has no end and that is outdated.”

Discussions over the fate of the consent decree, Freeman-Wilson argued, could provide an opportunity to address concerns about the proposed merger, including how it would affect reproductive health care.

“We don’t want our citizens to be any worse off in terms of their health choices as a result of the merger,” Freeman-Wilson said. One possible solution would be a standalone clinic for reproductive health services, she added.

Another concern for Freeman-Wilson is that Franciscan is not unionized. The local Service Employees International Union (SEIU) division that represents Methodist workers says it is watching the merger talks closely.

“Our primary concerns about any potential change in ownership of our hospitals are for workers to continue to have the right to bargain over wages, hours, benefits and working conditions and the quality of care delivery to patients,” SEIU spokesperson James Muhammad said in a written statement to Rewire.

Muhammad declined to address specific concerns about how the merger could affect reproductive health care, as did Methodist CEO and president Ray Grady. In his statement to Rewire, Grady said Methodist is exploring “all facets of the proposed relationship” during a 120-day “due diligence period” that began when the hospitals announced their letter of intent to merge in March.

“We are using this time to closely examine how this may affect each and every segment of our population to ensure that everyone will have access to the full range of health services,” Grady wrote.

If Gary residents and Methodist employees hope to block the proposed merger, advocates say the time to raise their voices is now.

Rev. Dena Holland-Neal (L) and Rev. Marie Siroky. (Amy Littlefield / Rewire)

Across the country, concerned residents and medical professionals have fought against attempts to impose religious restrictions on health care in their communities, and in some cases, these efforts have succeeded in stopping proposed mergers.

“This is definitely the time to push back,” Lois Uttley, director of MergerWatch, told Rewire in an interview. “The people who particularly depend on the Gary, Indiana, hospital, if it’s the only hospital in town, really need to raise their voices now about the potential loss of access to services and the imposition of Catholic religious doctrine at their hospital.”

In an initial step, the union and Gary NAACP are sponsoring a town hall meeting on May 31 to address concerns about the merger, including a lack of public information about the talks.

“Nobody in the community and very few workers in the hospital are getting any information about the discussions” between Methodist and Franciscan, reads a flier for the event.

The Ghost Hospital

“People need to realize what changes this really is going to bring to the city,” Marie Siroky told me, as we wrapped up our tour of Gary. “The services that right now people may take for granted [are] going to be missing, and people don’t get that.” Siroky is worried, for example, about patients who want to get their tubes tied immediately following a cesarean section, a common practice to avoid the risk and expense of a second surgery. The Catholic directives forbid sterilization, and a separate, standalone clinic of the kind described by Mayor Freeman-Wilson could still prevent patients who deliver in the hospital from having a tubal ligation at the same time.

One of the final stops on our tour is the carcass of Gary’s former Catholic hospital, St. Mary Medical Center, shuttered more than two decades ago. One section of the sprawling building now houses the Gary police department, but much of it sits abandoned, its broken windows gaping.

“Oh my God, I didn’t even realize it was still all decrepit like that,” Siroky said as we pulled up.

A cross loomed over the schoolhouse-like, brick façade. The building is an object of fascination for ghost hunters, who have wandered the crumbling corridors.

Siroky and the legendary singer Michael Jackson were both born in this hospital in the same year, 1958. On a ledge in front of a boarded-up window someone had built a makeshift shrine to the late musician. A cluster of tea lights surrounded a photo of Jackson in a cheap frame that had pitched forward on its face. Siroky propped it back up.

Ancilla Systems, sponsored by the Poor Handmaids of Jesus Christ, ran this hospital for decades before selling it to a for-profit chain in 1993, citing financial losses from caring for indigent patients. Two years later, it closed, leaving Methodist as the sole hospital in Gary.

Some local residents, like Rev. Dena Holland-Neal, never forgot that. For Holland-Neal, whose father, James Holland, was deputy to Mayor Richard Hatcher, the hospital’s closure is woven into the decades-long narrative of abandonment that has made Gary what it is today—from the racist backlash to Mayor Hatcher’s election as Gary’s first Black mayor, to the decline of the steel industry. So it’s not surprising that she is suspicious of Franciscan’s purported plans to invest in Gary, especially when they appear to involve ending the consent decree that protects the Gary hospital.

Holland-Neal worries about statistics that show Franciscan serves a lower percentage of poor patients than Methodist; Medicaid patients make up 30.5 percent of Methodist’s patient visits, versus 19.8 percent of Franciscan’s. She worries Franciscan would prioritize its own financial and religious interests, and that it might close Gary’s only hospital and never fulfill its promise to build a new one. For her, that feels like history repeating itself.

“Gary had a much larger population, they needed those two hospitals, and the nuns had no compassion whatsoever about that,” Holland-Neal said. “And, so remembering that, I don’t have a lot of faith in them making a compassionate move at this time. I don’t.”

Tell us your story. Have religious restrictions affected your ability to access health care? Email stories@rewire.news

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