The closing of St. Vincent’s Hospital was the result of damaging health care policy decisions which have existed for decades. Until those policies are examined and rejected it will be difficult to preserve our community hospitals in New York City, let alone secure a new hospital on the West Side.
Since the 1970s, there has been a consensus among many policy makers that New York City has too many hospital beds. As a result, there have been numerous closings and shrinking of hospitals. Stephen Berger, the head of the hospital closing Berger Commission pointed out in a recent NY Post article, that a dozen hospitals have closed in New York City since 2005 but “… health care access hasn’t worsened,” although people in the affected communities would strongly disagree. Further estimates state that up to one third of hospital beds in New York City have closed since the 1970s. Yet, medical care and expenditures are still among the highest in the country. This may be because New York City hospitals do more then provide care, they also train a disproportionate number of new health care workers ( therapists, nurses, doctors, etc. ) and they do a great deal of research. Alternatively, it could be because everything in New York City is more expensive then the rest of the country. In addition, the remaining hospitals and hospital chains have greater market share and bargaining power and can more easily run up their costs, as has been shown in several recent New York Times articles. How many hospitals must close before there is a consensus that this policy has failed?
There is also a national trend toward de-emphasizing institution care in favor of out-patient community based care. The Affordable Care Act (Obamacare) will help this along by increasing the number of people with insurance, Medicaid reimbursements, mental health coverage, and cutting hospital reimbursement. If community care is available, then institutional care is unnecessary. However, we have been through this before with poor results. Starting in the 1970s, terrible conditions in psychiatric hospitals led to a closing of those facilities and transfers of patients to community based services. Although there are many excellent out-patient and community based residential facilities, there have never been enough to treat all of the individuals who need help. As a result, we cannot read a paper or look at the TV news without seeing another example of an inadequately treated mental health sufferer being either the perpetrator or victim of violence. If medical care tries to transfer patients to services that don’t exist, this problem will only be repeated. Community health care should be available and functioning first before there is any consideration of closing any hospitals.
How was it decided which hospitals were to close and which were to stay open? The solution was to use the rules of the marketplace. Stephen Berger even wrote that hospitals should be closed when they are not “financially tenable.” It is simply assumed that the standard applied to hospitals should be the same as applied to a donut shop or shoe store and financially distressed institutions are by the rules of the marketplace unnecessary. The health care goal of the institution doesn’t over-ride the financial criteria. St. Vincent’s is losing money? Close it!
It wasn’t always this way. Until the Pataki administration, New York State had a system whereby the state government set hospital rates for the insurance companies. This was partially to prevent the hospitals from over-charging the insurance companies, but it also set a minimum rate so that many hospitals could stay open, if the rates were set correctly. When this system was abandoned, health policy experts predicted that it would result in the closing of many hospitals who didn’t have strong bargaining positions with the insurance companies of the marketplace; that is exactly what has happened. Another funding mechanism must be developed for hospitals rather than the dog eat dog negotiations of the marketplace or the fee for service system of charging for each individual hospital admission. The Health and Hospitals Corporation works this way, as does the Veterans Administration. Many single payer government systems around the world use global budgets for hospitals and these can be adjusted using health care needs as a guide.
What is to be done to save our hospitals and acquire a new one? Reject the philosophy that New York City has too many hospitals, reject the uncritical acceptance of marketplace rules, find new funding sources, and make sure a comprehensive system of out-patient services are available before even considering closing any more hospitals.