Analysts differ over implications of more hospital closings than openings since 1987

Article Abstract:

The closing of 698 hospitals between 1980 and 1989 was not balanced by the opening of an equivalent number of facilities, and most closings (508) were of community (general, acute-care) hospitals, according to data from the American Hospital Association (AHA). Of these, approximately half were urban and half rural, and most had fewer than 100 beds. The main reasons for the increased closings during the years 1984 to 1989 were low occupancy, staff shortages, changes in the population base served by the hospital, and insufficient payment by uninsured patients, or by Medicare and Medicaid. Urban hospitals in minority communities closed at a higher rate than other facilities, in part because of changing demographic trends. Some cities (St. Louis, Philadelphia) have large areas without a hospital. David Abernethy, an aide to the US House of Representatives Ways and Means Committee, believes that closings of very small, urban facilities are not significant, but that real problems do arise when medium-sized hospitals close because of increased use by people unable to pay. Small hospitals that cannot provide high-quality care should be closed, according to Abernethy. The director of the National Rural Health Association, however, believes that many rural hospitals that have not yet closed are in trouble. Do all closings represent a loss of access to medical care for the community? Perhaps not, if the community, too, is changing. For instance, urban hospitals in the northeast and midwest have closed, but new ones have opened in Florida and Arizona, where the elderly population increased during the 1980s. Many, however, are specialized facilities. A new program was approved by Congress in 1989 to create primary care hospitals that would refer patients with more complicated needs to essential access community hospitals, and some state programs to provide primary care are being developed. Experts agree that the current pattern of hospital closings does not optimally serve communities' needs. (Consumer Summary produced by Reliance Medical Information, Inc.)

Reports, Statistics, Demographic aspects, Rural health services, Hospital and community

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Hospital uncompensated care: crisis?

Article Abstract:

The American Hospital Association (AHA) reports that in 1987, $7.5 billion or 4.9 percent of all hospital expenses were not paid for by patients or reimbursed by Medicaid or insurance companies. This is up from $3.0 billion (3.9 percent) in 1980, and there is no end in sight to the increasing financial burden which is placed on hospitals. Medicaid represents a sizable percentage of the unpaid hospital bills, because it typically pays only 50 to 75 percent of the cost of providing service. The AHA believes that 66 percent of hospitals will be losing money on Medicare patients by 1991. In addition, the accounting practices of hospitals may incompletely establish the true costs of providing services. An important issue is whether uncompensated care should be accounted for on the basis of charges which are largely unknown. Previously, some costs could be shifted to other purchasers of health service, but the ability of hospitals to do this is now greatly limited. As a consequence, hospitals have begun using reserves or depreciation of hospital capital equipment to fund uncompensated services. The National Public Health and Hospital Institute reports that in 1987, 60 large urban hospitals lost an average of $3.08 million each or 2.4 percent of net revenues. The problem is more severe for certain hospitals than others; studies show that five percent of the nations' hospitals provide 37 percent of all uncompensated care. The problem of uncompensated care is solvable, if social attention and action are applied to it. All too often the issue is seen as an institutional problem, without the understanding that if the institution disappears, the individual patient will be left without medical care.

Analysis, Medical care, Cost of, Health care costs, Medicaid, Medicare

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The effect of hospital financial characteristics on quality of care

Article Abstract:

Patients may be more likely to receive substandard care at hospitals with fewer financial resources. Researchers examined the incidence of negligent medical injuries among 30,195 patients treated at 51 acute care hospitals in New York State during 1984. The hospitals with the lowest inpatient operating costs per patient had the highest incidence of medical injuries caused by negligence. Negligent medical injuries were more likely to occur at hospitals with fewer health care personnel to care for each patient. The effect of low inpatient operating costs was more pronounced at hospitals in financial crisis. These hospitals were more likely to treat indigent patients.

Care and treatment, Hospital patients

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