Hospital might halt admissions Panel seeks hearing on high costs, losses at New Children's

Outpatients-only possible

Health care

December 03, 1998|By M. William Salganik | M. William Salganik,SUN STAFF

A state regulatory panel yesterday took the first step toward closing the inpatient beds at New Children's Hospital.

The Health Services Cost Review Commission voted unanimously to schedule a hearing on whether the hospital rTC should stop admitting patients. The commission's staff reported that the hospital has the highest charges in the state and "consistent and increasing losses," which are depleting the hospital's endowment.

For its part, the hospital isn't saying whether it wants to continue inpatient care. It has been attempting for months to conclude a merger with the North Arundel Health System, and has maintained it needed to complete the deal before deciding what services to continue.

Agnes P. Nicholas, development and public relations director, said yesterday that the hospital would soon announce plans that "will fall into place with the strategic plan for the campus." She noted that, currently, "practically everything we do is outpatient."

The hospital recently broke ground for a 110-unit assisted-living complex. It also plans nursing home beds, in about two years, to supplement its outpatient programs. The North Arundel deal has been delayed, but Nicholas said it is "still a go."

State regulators have never shut a hospital, but hospital administrators have voluntarily closed four in the state over the last decade, converting them to other uses, such as nursing homes and medical offices. A similar voluntary shutdown is proposed for the inpatient beds at Liberty Medical Center.

Even if inpatient beds were eliminated, New Children's could continue to offer outpatient treatment. It also could convert the beds to rehabilitation or nursing home care, if state regulators approved.

Despite its name, and its early specialty in treating chronic children's diseases, the hospital now deals primarily with adult orthopedic cases.

Licensed for 76 beds, it has only 10 patients on an average day, according to Cost Review Commission data for the year ended March 31. As the number of patients dwindled, the commission's staff reported, the hospital kept the patients longer -- with average length of stay quadrupling since 1993 to 17 days. The cost for an average stay at Children's is 16.4 percent above the state average, adjusted for the type of cases the hospital treats.

The staff said in a report presented to the commission yesterday that it has had doubts about "the viability, effectiveness and efficiency" of the hospital for several years. Annual operating losses are about $3 million on revenue of $12 million, according to the report, eating into an endowment that is now reduced to about $12 million to $13 million.

Sean Cavanaugh, deputy director of the Cost Review Commission, said the staff hopes New Children's will move voluntarily to shut its inpatient beds before completion of the hearing process, which will take several months.

Before a hearing can be set, a second regulatory board, the Health Resources Planning Commission, would have to agree to a joint hearing with the cost review panel. Carol L. Hutchison, deputy director of the planning commission, said the planning staff will recommend that course to the commission when it meets next week.

After the two commissions have their joint hearing, they could petition the state health secretary to "delicense" New Children's for inpatient care.

The secretary would conduct another hearing before he could act to pull the license, Cavanaugh said.

Pub Date: 12/03/98

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