Sunday, August 20, 2000

Ohio hospitals face stress

Closings raise fears about quality

By Tim Bonfield
The Cincinnati Enquirer

        From Cincinnati to Dayton to Cleveland, more hospitals have closed this year in Ohio than in any other state in the nation.

        In fact, the year 2000 ranks among the three toughest years for Ohio hospitals in the past two decades — a development that has raised fresh questions about hospitals' abilities to keep up with medical technology, hire enough nurses and maintain services for low-income people.

        “What our members are saying is that this year has been unprecedented in terms of the financial stresses hospitals are experiencing,” said Mary Yost, a spokeswoman for the Ohio Hospital Association.

        So far this year, five Ohio hospitals have either shut down or announced plans to close by year's end. Those hospitals include three large urban hospitals: Cincinnati's Bethesda Oak, Dayton's Franciscan Medical Center, and Cleveland's Mount Sinai Medical Center-University Circle.

        That is more closings in one state than anywhere else, and nearly a quarter of the 22 hospitals that closed this year nationwide, according to a study released this week by Dynamis Healthcare Advisors, a consulting firm with offices in Cleveland and Washington.

        “We're seeing the results of a lot of pent-up problems,” said Chris Manners, Dynamis chairman.

  In the past decade, there have been three tough years for hospitals in Ohio
  1994: 5 closings

  • Parkview Hospital, Toledo
  • Brentwood Hospital, Warrensville Heights
  • St. Joseph Hospital, Lorain
  • Potters Medical Center, East Liverpool
  • Emerson A. North Psychiatric Hospital, Cincinnati
  1996: 7 closings
  • Mercy Hospital, Toledo
  • Warren General Hospital, Warren
  • Western Reserve-Southside, Youngstown
  • Dartmouth Hospital, Dayton
  • CareUnit Hospital, Cincinnati
  • Woodside Psychiatric Hospital, Youngstown
  • Fallsview Psychiatric Center, Cuyahoga Falls
  2000: 5 closings
  • Bethesda Oak Hospital, Cincinnati
  • Franciscan Medical Center, Dayton
  • Mount Sinai Medical Center-University Circle, Cleveland
  • Veterans Memorial Hospital, Pomeroy
  • Youngstown Osteopathic Hospital, Youngstown
        The fiscal challenges facing Ohio hospitals include years of tight reimbursement from private managed-care health plans, complications caused by Medicare and Medicaid managed-care plans, rising numbers of un insured people, rising demands for health services from the elderly, rising costs for prescription drugs and rising labor costs linked to shortages of nurses and other health professionals.

        While many of these issues are common to hospitals nationwide, closings tend to occur in spurts among states as hospital executives and trustees watch their competitors.

        “No one wants to be first, but once it happens, the idea spreads,” Mr. Manners said. “We're seeing the same sorts of weakness in Michigan and Pennsylvania. Some hospitals in Philadelphia and Pittsburgh appear very much at risk.”

        While the closings have raised questions about quality and access to care — especially in the communities most immediately affected — much debate remains over how much the public should be alarmed.

        Community groups say low-income people are losing services as more urban or inner-city hospitals close. Yet health care analysts say Ohio still has more hospital capacity than people need, even after this year's closings.

        Although hospital executives say their facilities can still meet today's health care demands, continuing budget pressure has made them increasingly nervous about the future.

        “We can't say quality of health care has been affected by x number of percentage points. But there is a concern that if you keep cutting, you will reach a point where quality is affected,” Ms. Yost said.

        Beyond the extreme situation of closing buildings, many hospitals in Greater Cincinnati and elsewhere are slashing capital improvement budgets, straining to pay for medical supplies, and struggling to hire nurses.

        “We're still in one of the toughest crunch times. And next year is not going to be a whole lot better,” said Claus von Zychlin, executive vice president of operations at TriHealth. “Our reimbursement (public and private) simply is not at a level that pays for quality care. And that makes it tough to reinvest in our facilities.”

        In Cincinnati, Avondale residents have witnessed the recent closing of Bethesda Oak plus the 1997 closing of Jewish Hospital — both large hospitals in a mostly African-American, central-city neighborhood.

        “Anytime you have a hospital moving out of a community, it's going to have an effect,” said Tom Jones, who talks with numerous Avondale seniors in his work as chairman of a neighborhood public safety task force. “A lot of these people are very quiet about it. They don't speak out, but I can tell you they're very mad about it.”

        Mr. Jones said Bethesda Oak was a favorite for seniors because the hospital was on a convenient bus route. Other hospitals on “Pill Hill” may be close to Bethesda Oak, but getting to appointments has become more complicated, he said.

        TriHealth officials, however, say the blow to the neighborhood has been minimal.

        First, long before Bethesda Oak closed, the hospital's activity had dwindled to a shadow of its former glory. Once a 450-bed hospital, average bed occupancy was down to 42 patients a day.

        Second, TriHealth tried to minimize disruption to patients by urging doctors in two medical buildings linked to the hospital to stay in the neighborhood. Of 82 doctors located there in February, 72 have stayed, said Steve Schwalbe, TriHealth vice president of strategic planning.

        “Post-closure, we followed up with polls of past emergency department patients. Overwhelmingly, people are getting the care they need,” Mr. Schwalbe said.

        Looking back 20 years, Ohio witnessed seven hospital closings in 1996 and five in 1994. There were no more than three closings in any other year back to 1980, which analysts say reflects the turbulence hospitals faced throughout the 1990s.

        Even though the number of closings was higher in 1996, the Ohio Hospital Association says the closings in 2000 have been more significant.

        In 1996, the hospitals involved generally were smaller; and four of the closings were psychiatric or substance abuse care hospitals as opposed to full-service community hospitals.

        The situation this year has been most intense in Cleveland, where one hospital closed and two more were on the brink until a recent court order allowed them to be sold.

        Unlike 1996, the hospital closings in 2000 reflected immediate financial stress rather than strategic responses to changing market forces, Ms. Yost said. In such unplanned situations, the risk of punching a hole in the community safety net of health services increases.

        “The concern we have is that we're not making these decisions after having thoughtful discussions and debate. These decisions are being made by default, and I don't know if that's the best way,” Ms. Yost said.

        “What we need is a more purposeful health-care system. We really haven't had the public debate we should have on how we should pay for health care,” Ms. Yost said.

        Nationally, the American Hospital Association has launched a multimillion-dollar lobbying blitz to pressure Congress to revise the Balanced Budget Act of 1997, which resulted in lower Medicare hospital reimbursement.

        But few say the hospital industry problems are as simple as a single act of Congress. Years of evolving, improving medical technology also have reduced demand for big, central city hospitals, said Scott Keller, Dynamis president.

        Even with a near-record year of closings, Ohio still has more than 50 percent more hospital capacity than the state needs, Mr. Keller said.

        To Mr. Keller the concern about access to health care isn't about hospital closings. It's about access to the latest in new medicines and diagnostic services that are increasingly provided in non-hospital settings — which are increasingly built in high-growth, high-income suburbs.

        Dynamis has been working with hospitals in several cities to convert closed facilities into centers for primary health care and other uses aimed at serving nearby residents.

        “The bottom line is that everybody is right on this issue,” Mr. Keller said. “It will take honest dialogue between politicians, business leaders, hospitals and neighborhood groups to work it out. If that happens, the result can be better services for a neighborhood than when the hospital was there.”


TriHealth decides to sell Bethesda Oak buildings

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