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EMPOWERING
NEW YORK
CONSUMERS
IN AN ERA OF
HOSPITAL
CONSOLIDATION
May 2018
By Lois Uttley, MPP
Fred Hyde, MD, JD, MBA
Patricia HasBrouck, MBA and
Emma Chessen, MPH
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EMPOWERING
NEW YORK
CONSUMERS
IN AN ERA OF
HOSPITAL
CONSOLIDATION
May 2018
By Lois Uttley, MPP
Fred Hyde, MD, JD, MBA
Patricia HasBrouck, MBA and
Emma Chessen, MPH
Graphic Design by Brucie Rosch
Support for this work was provided by the New York State Health Foundation (NYSHealth).
The mission of NYSHealth is to expand health insurance coverage, increase access to high-quality
health care services, and improve public and community health. The views presented here are those of the
authors and not necessarily those of the New York State Health Foundation or its directors, officers, and staff.
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Table of Contents
Acknowledgements 3
Executive Summary 4
The Changing Hospital Landscape 10
Table 1: New York hospitals closed for inpatient services since 1997 12
Table 2: New York hospital beds changes by category 2015-17 13
Table 3: Changes in number of hospital beds by region 2017 14
Table 4: Dozen largest hospital systems operating in New York State 16
Table 5: Largest hospital systems in New York ranked by net assets 18
New York’s Oversight of Hospital Consolidation Through CON 22
Table 6: Number, value and type of CON applications 2015-17 24
Table 7: Hospital CON applications by type and year 24
Table 8: Median days of CON processing time 25
Key Findings of Study 26
Recommendations 29
1. Ensure that consumers affected by hospital closures or elimination
of key hospital services are notified and engaged 30
2. Improve transparency, consumer engagement and accountability
when health systems propose takeovers of community hospitals 35
3. Increase consumer representation on the PHHPC and improve the overall
transparency and consumer engagement of the current NYS CON process 41
4. Ensure CON-approved projects protect access to timely, affordable care
and advance identified local and state health planning goals 45
Conclusion 51
Table 9: States with consumer-friendly CON policies and procedures 52
Appendices:
A. CASE STUDY: The Dismantling of Cornwall Hospital 53
B. CASE STUDY: The Transformation of Mount Sinai Beth Israel 63
C. Improving Consumer Access to CON Information on the DOH Website 73
D. Hospital data: Sources, methods and analysis 84
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Acknowledgments
S upport for this work was provided by the New York State Health Foundation (NYSHealth). The mission of
NYSHealth is to expand health insurance coverage, increase access to high-quality health care services, and
improve public and community health. The views presented here are those of the authors and not necessarily
those of NYSHealth or its directors, officers and staff.
The authors wish to thank the project’s sponsors for their support and assistance throughout the study,
particularly David Sandman and Amy Shefrin from NYSHealth. The study team also wishes to acknowledge
staff of the New York State Department of Health and members of the New York State Public Health and
Health Planning Council for providing valuable insights to inform this study.
Authors of this report include:
Lois Uttley, MPP, founded the MergerWatch Project in 1997 to protect patients’ rights and access to care
when hospitals merge. She has authored numerous articles and reports on hospital consolidation, including
a 2016 study When Hospitals Merge: Updating State Oversight to Protect Access to Care. She has served as Director
of Public Affairs for the New York State Department of Health, Vice President of the Education Fund of Family
Planning Advocates of NYS, President of the Public Health Association of NYC and Chair of the Action Board
of the American Public Health Association. She serves on the steering committee of the statewide Health Care
for All New York coalition. Ms. Uttley earned a Master’s in Public Affairs and Policy from the Nelson A. Rockefeller
College of Public Affairs and Policy of the University at Albany, was a National Urban Fellow and teaches in
the Master’s in Health Advocacy Program at Sarah Lawrence College. In February of 2018, she became
Program Director for the Women’s Health Program of Community Catalyst.
Fred Hyde, MD, JD, MBA, is a consultant to hospitals, medical schools and physicians, as well as to unions,
community groups and others interested in the health of hospitals, health care facilities and organizations.
He has served twice as chief executive of a non-profit hospital, as chief executive of an ambulatory surgery
center, as chief executive of an HMO, as vice president of a major university teaching hospital, as director of
a medical school faculty practice plan, and consulting manager of physician practices. Dr. Hyde has taught
hospital management, health care financial management and medical technology reimbursement and
regulation at Columbia University’s Mailman School of Public Health (where he is a Clinical Professor) and at its
Business School; at Fordham’s Global Healthcare Innovation Management Center; and at Georgetown’s School
of Nursing and Health Studies. He served on the Governor’s Task Force on Certificate of Need in Connecticut.
His received undergraduate, medical and law degrees from Yale and a business degree from Columbia.
Patricia HasBrouck, MBA, is an independent health care consultant with experience in financial modeling,
strategic planning, regulatory support, policy research and evaluation, health care financing and managed
care. She earned an MBA from Northwestern University’s Kellogg School of Management and a BS in
industrial engineering from Stanford University.
Emma Chessen received her Master’s in Public Health in May 2018 from Columbia University’s
Mailman School of Public Health. She received a BA from the University of Pennsylvania.
Also contributing to the design of the study and initial research were Christine Khaikin, JD,
Elisabeth Hamlin-Berninger, MHA, and Morgan Beatty, a dual-degree medical and public health
student at Columbia University. Graphic design of this report was provided by Brucie Rosch.
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Executive Summary
O ver the last 20 years, changes in reimbursement policies
and medical advances have altered the hospital landscape
nationwide and in New York. Three trends have dominated the hospital industry:
1) downsizing and closing of community hospitals, 2) hospital consolidation and creation
of large regional health systems, accompanied by 3) movement of some medical care from
hospitals into lower-cost outpatient settings.
The impact of these trends can be seen in the findings from MergerWatch research:
• Forty-one New York hospitals have closed all of their inpatient services
over the last 20 years. Some hospitals have been converted to use as
outpatient centers, medical offices, nursing homes or rehabilitation centers,
while others have been turned into condominiums or abandoned.
• The number of hospital beds being decertified across New York
State jumped from 102 in 2015 to 440 in 2017, with the largest
losses occurring in medical/surgical, psychiatric, maternity and pediatric
care, according to New York State Department of Health data.
• A group of large non-profit health systems has been steadily moving to
manage or acquire many of the remaining community hospitals in the state.
The 12 largest systems now control half of all the acute care hospitals
in New York and 70 percent of the inpatient acute care beds. Four
mega-systems – New York-Presbyterian, Northwell Health, NYU Hospitals
Center and Mount Sinai Health System – have accumulated multiple
hospitals and a combined total of $14.2 billion in net assets, giving them
significant economic power and ability to shape the health system.
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With all this change occurring in the hospital landscape, do New Yorkers have a say in
hospital closure and consolidation decisions? How are New York’s health consumers being
notified of proposed changes to their local hospitals? Are they being afforded the opportunity
to comment on how their access to timely, affordable care might be affected? Are state
regulators able to ensure that proposed hospital mergers, closings, downsizing and movements
of care to outpatient settings benefit consumers and do not create
THE CERTIFICATE gaps in access to care? Equally important, how are regulators
ensuring that these consolidations do not exacerbate existing
OF NEED PROCESS health disparities or unnecessarily increase health care prices?
PROVIDES AN
The state Certificate of Need (CON) process provides an
OPPORTUNITY TO opportunity to engage community residents in these decisions
ENGAGE COMMUNITY that can dramatically affect their lives. In 1964, New York established
RESIDENTS IN THESE the first-in-the nation CON process at a time when new hospitals
were being constructed with the aid of the federal Hill-Burton Act.
DECISIONS THAT Demand for hospital care was fueled by the growth of third-party
CAN DRAMATICALLY private health insurance and by the enactment of Medicare and
AFFECT THEIR LIVES. Medicaid in 1965. Policymakers were concerned that unregulated
construction of new hospitals and expansion of existing facilities
would lead to unnecessary construction and duplication of expensive equipment, resulting
in higher-than-necessary health care costs. CON was also intended to protect a hospital’s
“franchise” from competition that could hurt its ability to repay loans. The CON program
has required hospitals and other institutional health providers to seek state approval for
construction, expansion, renovation and establishment of new facilities and services.
In the new era of hospital consolidation, is New York’s 54-year-old CON process
effective in working to notify the public, meaningfully engage consumers and protect
community access to timely, affordable care? A year-long study by MergerWatch, funded by
the New York State Health Foundation, set out to find the answer.1 The study found that New
York State Department of Health staff and leaders of the Public Health and Health Planning
Council (PHHPC), which reviews the most important CON applications (those designated for
full review), have taken some positive steps in recent years to improve CON review. However,
the study concluded that the CON process still lacks transparency, consumer engagement and
sufficient oversight of health care providers in this rapidly changing landscape.
A 2012 PHHPC report made a number of significant suggestions about ways to reform the CON
process. However, some of those suggestions were never acted upon or were implemented in
ways other than what the PHHPC had envisioned. Moreover, since that 2012 PHHPC report, the
1. The study was focused on oversight of acute care hospitals and health systems, and did not review the processing of
CON transactions involving nursing homes or home care agencies.
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pace of change in the hospital sector has quickened. New York’s Delivery System Reform
Incentive Payment (DSRIP) Medicaid redesign program has put large systems with ample
administrative capacity at an advantage and has pushed stand-alone community hospitals
to join larger hospital systems. Such marriages of community hospitals and dominant systems
come to the CON application process as virtual “done deals,” encouraged by state officials
and sweetened with state grants.
PHHPC members and DOH staff are engaged in another round of examining how to modernize
CON and other state health regulatory oversight processes, with PHHPC Chair Jeffrey Kraut
suggesting that the Department of Health “is trying to solve new millennial challenges with
a regulatory and CON chassis that is 30-40 years old.” At a PHHPC strategic planning retreat in
September 2017, Kraut (who is also Executive Vice President
of Strategy and Analysis for the Northwell Health system) THE CON PROGRAM
described a need to “articulate a different vision of a new DOES NOT ADEQUATELY
framework for DOH to fulfill its mission of accountability and INFORM OR ENGAGE
oversight, to have transparency and public engagement.”2
HEALTH CONSUMERS
This MergerWatch study is intended to offer valuable
suggestions on how to ensure that CON reform enhances
ABOUT HOSPITAL
transparency and consumer engagement, and that it CONSOLIDATION,
protects access to affordable care for vulnerable health DOWNSIZING OR
consumers. The study concludes that the CON program as CLOSING THAT
currently operated in New York State does not adequately
inform or engage health consumers about hospital COULD AFFECT THEIR
consolidation, downsizing or closing that could affect ACCESS TO TIMELY,
their access to timely, affordable care. AFFORDABLE CARE.
Key Findings
• No state-mandated system exists to notify and engage affected
consumers in advance when their community hospitals will be closing,
downsizing, transforming into outpatient settings and/or joining a
large health system that will assume decision-making over the local
facility. Public hearings are not required in the affected communities or at
convenient times for consumers in advance of a hospital closing, downsizing
or other transaction with a major impact on the facility and community.
2. Jeffrey Kraut, “The Role of the PHHPC in Public Health and Health Planning; Looking Back and Looking Forward,” September 6, 2017,
http://www.totalwebcasting.com/view/index.php?func=VIEW&id=nysdoh&date=2017-09-06&seq=1
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• Hospital closings and some types of downsizing (such as eliminating the
emergency department or maternity services) are not subject to “full
review” by the PHHPC in a public meeting. Instead, many are being handled
through “limited review” CON applications that are decided by state DOH staff.
• Increasing numbers of CON applications are being decided out of public
view through “administrative review” and “limited review” or through
simple “notice” to the state. State processing of CON applications has been
streamlined and shortened at the urging of hospitals, making it more difficult
for affected consumers to learn about and comment on proposals.
• User-friendly information is difficult to find on the NYS DOH website concerning
individual CON applications, the CON review process or how to submit comments
on pending applications.
• PHHPC meetings and their agendas are not NO PROCESS HAS
widely publicized. The meetings are held only
on weekdays in Albany or New York City, creating BEEN DEVISED TO
hurdles for consumers who would have to take time SEEK AND CONSIDER
off from work and travel to present comments. There
frequently is no response when the committee chair THE VIEWS OF LOCAL
asks, “Are there any comments from the public?” HEALTH OFFICIALS
• The public’s voice is not well represented on AND AFFECTED
the PHHPC itself, with only a single seat being
designated for a consumer representative COMMUNITIES
(and that seat having been vacant since ON PENDING CON
mid-2016). This is in stark contrast to public
representation in some other states, where APPLICATIONS.
health care provider representation is severely
limited on CON-decision making bodies and the chair must be a consumer.
• Since the demise of all but one local Health System Agency (HSA), no
replacement process has been devised to seek and consider the views of local
health officials and affected communities on pending CON applications.
• Until now, CON decision-making has not included consideration of whether
proposed hospital transaction would advance identified local or state
health planning goals, such as those articulated in the Prevention Agenda.
In June of 2018, the “full review” CON applications for general hospitals will begin
to ask applicants about how the proposed project advances local Prevention
Agenda priorities, which will represent an important step in the right direction.
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• Publically-available summaries of CON applications often do not explain
how the project would meet the needs of medically-underserved people,
such as those who are low income, racial and ethnic minorities, women
or people with disabilities.3
• Also unaddressed in CON decision-making is whether a proposed consolidation
could increase the price of health care in affected communities.
• No CON review or public notification is required when health systems initiate
takeovers of local hospitals by using an unregulated “passive parent” mechanism
found in no other state. When systems do submit CON applications to assume “active
parent” governance of hospitals (which gives them direct authority over the hospital’s
budget and management), applicants are not required to explain how local residents
would be given a continuing voice in hospital decision-making (such as through seats
on the board).
“WE HAVE NOT HAD “We look with a microscope at individual applications with criteria
that are decades old, and have not had a discussion here about the
A DISCUSSION ABOUT implications of consolidation and should there be expectations of
THE IMPLICATIONS consolidation,” said Dr. John Rugge, who is Chair of the PHHPC’s
OF CONSOLIDATION.” Planning Committee and Founder, Executive Chairman of the Hudson
Headwaters Health Network.4 “For example,” he asked, “should there
– DR. JOHN RUGGE be expectations about local governance?”
Summary of Recommendations
How can New York’s CON process be made more transparent and engaging of
consumers in the new era of hospital consolidation? The study produced four categories
of recommendations about how to make the process more transparent, drawing on practices
found in other states and in a few cases on recommendations from the 2012 PHHPC report
that were not acted upon:
1. Ensure that consumers affected by hospital closures or elimination of key hospital
services are notified and engaged. We propose (a) requiring 90 days advance notice
and provision of a proposed closure plan, as well as (b) a public hearing in the affected
community at least 60 days in advance and (c) full review of these transactions in public
meetings by the Public Health and Health Planning Council (PHHPC), with special
attention to the potential effect on health consumers who are low-income, racial and
ethnic minorities, women, people with disabilities, the elderly, and members of other
underserved groups.5
3. As spelled out in Section 709.1, determination of need pursuant to section 2802 of the Public Health Law, accessed at
https://regs.health.ny.gov/book/export/html/45945
4. Dr. John Rugge, in comments to the Public Health and Health Planning Council on December 7, 2017, as reported
in the minutes of the meeting.
5. Section 709.1 - Determination of public need pursuant to section 2802 of the Public Health Law
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WE URGE FULL 9
DISCLOSURE BY 2. Improve transparency, consumer engagement and accountability
HEALTH SYSTEMS when health systems propose takeovers of community hospitals.
We urge full disclosure by systems of plans to downsize or transform
OF PLANS hospitals they are acquiring, followed by post-transaction reporting
TO DOWNSIZE and monitoring to ensure accountability to affected consumers.
OR TRANSFORM We urge a requirement for public hearings in affected communities
to ensure consumer engagement, especially for consumers who are
HOSPITALS THEY medically underserved or could become so as a result of the transaction.
ARE ACQUIRING. We propose eliminating health systems’ use of an unregulated
mechanism (called “passive parent”) to begin takeovers of local hospitals
without transparency or accountability to affected consumers.
3. Increase consumer representation on the PHHPC and improve the overall
transparency and consumer engagement of the current NYS CON process.
We urge the addition of more consumer representatives to the PHHPC to better ensure
consumer views are heard and considered, and to counterbalance the presence of
health system representatives. We recommend improvements to the NYS DOH website
to make it easier for consumers to find hospital CON applications and to submit
comments on them. We recommend requiring CON applicants to submit Letters of
Intent 30 days prior to the filing of a CON, and posting those LOIs promptly on
the DOH website.
4. Ensure CON-approved projects protect access to timely, affordable care and
advance identified local and state health planning goals. We recommend that
CON applicants be required to state how their projects would address identified state
and local health planning goals, such as the Prevention Agenda, and advance health
equity by improving access to care for medically-undeserved health consumers.
We also suggest that applications for large-scale transactions, especially hospital
consolidations, be required to project the impact of the transactions on the price
of health care services.
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The Changing
Hospital Landscape
A cross the nation, the pace of hospital consolidation is quickening and health
care delivery is transforming. Historically independent community hospitals are
joining regional and national health systems. The number of hospital mergers and
acquisitions nearly doubled between 2010 and 2015.6 In 2017, there were 115 hospital
mergers and acquisitions, the highest number in recent history.7 Some financially
stressed community hospitals are downsizing, converting into urgent care centers or
freestanding emergency departments, or closing. Especially hard hit are rural hospitals,
more than 119 of which have closed since 2005.8 Some urban hospitals, particularly
those that are publicly owned and disproportionately serve uninsured and Medicaid
patients, are also struggling.
6. “Hospital Merger and Acquisition Activity Up Sharply in 2015, According to Kaufman Hall Analysis,” KaufmanHall, Skokie, Ill.,
January 20, 2016, accessed at https://www.kaufmanhall.com/news/hospital-merger-and-acquisition-activity-sharply-2015-
according-kaufman-hall-analysis
7. “2017 in Review: The Year M&A Shook the Healthcare Landscape” (Kaufman Hall, 2018),
https://www.kaufmanhall.com/resources/2017-review-year-ma-shook-healthcare-landscape
8. Data from North Carolina Rural Health Research Program, cited in Mincer, J., “More hospital closings in rural America add risk for
pregnant women,” Reuters, July 18, 2017, accessed at https://www.reuters.com/article/us-usa-healthcare-rural/more-hospital-
closings-in-rural-america-add-risk-for-pregnant-women-idUSKBN1A30C5
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Many externalities are driving these trends, including clinical advances that make it possible to
safely move treatment from inpatient hospitals to ambulatory sites. Other factors include payer
demand (from private insurers, employers and government payers) for “value-based” care that
necessitates capital investment in expensive technology (such as electronic medical records) to
support collaboration among health care providers along the continuum of care, as well as
administrative capacity to negotiate and manage value-based contracts. These requirements
have proved challenging for smaller hospitals with limited administrative capacity and access to
capital. Health systems have also acquired hospitals to increase market share, thereby gaining
negotiating leverage with health insurers, as well as a larger patient
PAYER DEMANDS base to feed larger tertiary care hospitals within each system. For
rural and some urban hospitals, challenges may be precipitated by
FOR “VALUE-BASED
prohibitive costs to renovate aging hospital buildings, lack of access
CARE” HAVE PROVED to capital and high percentages of patients who are uninsured or
CHALLENGING FOR who are insured by (lower paying) Medicaid.
SMALLER HOSPITALS What has been happening in New York State? A total of
WITH LIMITED 41 hospitals have closed general inpatient services over the
last 20 years, MergerWatch research has found. Sixteen of those
ADMINISTRATIVE
hospital campuses have been converted to non-medical uses – such
CAPACITY. as condominiums, assisted living facilities, office space and schools
– or are abandoned. The remaining 25 former hospital sites continue
to be used for a range of medical services, such as clinics, labs, ambulatory surgery centers, urgent
care centers, psychiatric treatment facilities, nursing homes, and drug or alcohol rehabilitation
centers. (See the list of closed hospitals on page 12.)
More than half of these closings (23 hospitals or 56 percent) have occurred since 2007. Some
were recommended in 2006 by a state hospital “rightsizing” initiative called the Commission
on Health Care Facilities in the 21st Century (known the Berger Commission, after its Chairman,
Stephen Berger). The commission estimated that the state had excess capacity of more than
10,000 hospital beds, which it said was enormously costly. The Commission targeted five
hospitals in New York City for closure: St. Vincent’s Midtown Hospital and Cabrini Medical Center
in Manhattan, Victory Memorial in Brooklyn, New York Westchester Square Medical Center in
the Bronx and Parkway Hospital in Queens. Four upstate hospitals were targeted for closure:
Millard Fillmore Gates Circle in Buffalo, St. Joseph’s in Cheektowaga, Bellevue Women’s Hospital
in Niskayuna and Community Hospital in Dobbs Ferry. Nearly all of the recommended closings
occurred within a year or two of the Commission’s report. The Commission also recommended
that 48 other hospitals reconfigure, either by merging with nearby facilities or by converting
hospital beds to other uses. Many of these reconfigurations have taken place, or are in process.
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TABLE 1
New York hospitals closed for inpatient services since 1997
YEAR OF
HOSPITAL NAME LOCATION CURRENT USE OF FORMER HOSPITAL FACILITY/CAMPUS
CLOSING
NON-MEDICAL USE OF FORMER HOSPITAL CAMPUS
Beth Israel Medical Center-
Herbert and Nell Singer Division Manhattan 2004 Demolished and luxury condos built in place
Cabrini Medical Center Manhattan 2008 Converted to residential units (2013)
Catholic Med CTR of Brooklyn/Queens- Queens (Jamaica) 2009 Residential units planned
Mary Immaculate Hospital
Catholic Med CTR of Brooklyn/Queens-
Queens (Elmhurst) 2009 In process of conversion to residential
St. John's Queens Hospital
Genesee Hospital Rochester 2001 Demolished and office complex built in place
Kaleida Health Adult Hospital- Buffalo 2012 Demolished and senior assisted living complex built in place
Millard Filmore Gates
Washington County
Mary McClellan Hospital 2003 Abandoned
(Cambridge)
New York United Hospital Port Chester 2005 Abandoned, plans for mixed use development
Orange Regional Medical Center- Middletown Campus Middletown 2011 Repurposed as campus for Touro College, osteopathic medical school
Parkway Hospital Queens (Forest Hills) 2008 Abandoned for several years, purchased and undergoing DEC review
Salamanca Hospital District Authority Salamanca 1998 Demolished (2011)
Sheehan Memorial Hospital Buffalo 2012 Office space (2013)
Staten Island University Hospital-Concord Division Staten Island 2009 Public School
St. Agnes Hospital White Plains 2003 Luxury assisted living residence (2013)
St. Vincent's Midtown Hospital Manhattan 2007 Partly abandoned, partly residential (2014)
St. Vincent's Hospital and Medical Center of New York Manhattan 2011 Demolished and luxury condos built in place
SOME TYPE OF MEDICAL SERVICES ON FORMER HOSPITAL CAMPUS
Albert Lidley Lee Memorial Hospital Fulton 2009 Urgent care center
Amsterdam Memorial Hospital Amsterdam 2014 10 rehab beds, ambulatory services
Bayley Seton Hospital Staten Island 2004 Small portion of property used for chemical dependency treatment
Brunswick Hospital Center Amityville 2003 Inpatient Psychiatric Hospital
Our Lady of Victory Hosptial of Lackawanna Lackawanna 2002 Nursing home
Faxton- St. Lukes Healthcare- Faxton Division Utica 2003 Ambulatory surgery, urgent care, other ambulatory care services
Inter-community Memorial Hospital at Newfane Newfane 2014 Ambulatory care services
Lakeside Memorial Hospital Brockport 2013 Free-standing Emergency Department and ambulatory care services
Long Beach Medical Center Long Beach 2013 Free-standing Emergency Department
Long Island College Hospital Brooklyn 2014 Free-standing Emergency Department run by NYU Langone
Manhattan Eye Ear & Throat Hospital New York 2007 Ambulatory surgery and other ambulatory services
Massapequa General Hospital Seaford 2000 Medical offices and school
Myers Community Hospital Sodus 2003 Medical offices
New York Westchester Square Medical Center Bronx 2013 Free-standing Emergency Department run by Montefiore
North General Hospital New York 2010 Ambulatory care services and medical residency program
North Shore University Hospital at Syosset Westbury 1997 Ambulatory surgery
Peninsula Hospital Center Queens (Far Rockaway) 2012 Nursing and Rehabilitation Center (2014)
St. Clares Hospital- McClellan Division Schenectady 2011 Ambulatory care services
St. John's Riverside Hospital- Park Care Pavilion Yonkers 2001 Inpatient chemical dependence rehab and detox
St. Luke's Cornwall Hospital- Cornwall Campus Cornwall 2017 Medical offices
St. Mary's Hospital of Brooklyn Brooklyn 2005 Transitioning to nursing home
Tri-Town Regional Hospital Sidney 2005 Free-standing Emergency Department
Union Hospital of the Bronx Bronx 1998 Ambulatory care services, dental, mental health, urgent care, PT/OT
United Memorial Medical Center-
Batavia 2000 Ambulatory care services
Bank Street Campus AKA St. Jerome
Victory Memorial Hospital Brooklyn 2008 Urgent care center
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The number of hospital beds in New York has been steadily decreasing as facilities are
downsized and transformed. NYS DOH data on hospital bed changes from 2015-2017 reveal
a sharp jump in the number of beds lost, from 102 in 2015 up to 474 in 2017. The greatest
reductions have been in the number of traditional medical/surgical beds, which decreased
by 402 beds over the three-year period. The next largest reduction was in psychiatric care,
which decreased by 202 beds, followed by maternity care (down 88 beds) and pediatrics
(down 80 beds).
TABLE 2 A snapshot of 2017 bed changes
New York hospital beds changes by type of care and region of the
by category 2015-17 state is shown in Table 3 on page
(with largest categories of bed losses highlighted) 14. Most of the 2017 reduction
was in beds classified as medical/
HOSPITALS 2015 2016 2017 Total
surgical, maternity, psychiatric, or
BED CATEGORY
physical medicine & rehabilitation.
AIDS N/A N/A -13 -13
Regions experiencing the greatest
Bone Marrow Transplant 0 0 2 2
losses in beds included New York
Chemical Dependency, Detox -31 0 -12 -43 City, the Northeast region
Chemical Dependency, Rehab 0 -30 37 7 (Capital District and north)
Coma Recovery -4 0 -5 -9 and Long Island.
Coronary Care 0 -7 -10 -17 When Charles Abel, Deputy
Intensive Care 25 33 -2 56 Director of the NYS DOH’s
Maternity Beds 0 -4 -84 -88 Center for Health Facility Planning,
addressed this reduction in beds
Medical/Surgical -89 -131 -182 -402
at the February 8, 2018, PHHPC
Neonatal Intensive Care 55 16 6 77
meeting, he said that “these are
Neonatal Intermediate Care -19 16 -14 -17 beds that have proven not to
Neonatal Continuing Care 0 -2 -3 -5 be needed.” He added, “Some of
Pediatric -7 -36 -37 -80 those have come out as a result
Pediatric ICU 8 0 -5 3
of hospital construction projects
where the hospital does not see
Physical Medicine & Rehabilitation 19 -32 -58 -71
the need to construct a new wing
Prisoner
Preview
FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION May 2018 By Lois Uttley, MPP Fred Hyde, MD, JD, MBA Patricia HasBrouck, MBA and Emma Chessen, MPH FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION May 2018 By Lois Uttley, MPP Fred Hyde, MD, JD, MBA Patricia HasBrouck, MBA and Emma Chessen, MPH Graphic Design by Brucie Rosch Support for this work was provided by the New York State Health Foundation (NYSHealth). The mission of NYSHealth is to expand health insurance coverage, increase access to high-quality health care services, and improve public and community health. The views presented here are those of the authors and not necessarily those of the New York State Health Foundation or its directors, officers, and staff. FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 2 Table of Contents Acknowledgements 3 Executive Summary 4 The Changing Hospital Landscape 10 Table 1: New York hospitals closed for inpatient services since 1997 12 Table 2: New York hospital beds changes by category 2015-17 13 Table 3: Changes in number of hospital beds by region 2017 14 Table 4: Dozen largest hospital systems operating in New York State 16 Table 5: Largest hospital systems in New York ranked by net assets 18 New York’s Oversight of Hospital Consolidation Through CON 22 Table 6: Number, value and type of CON applications 2015-17 24 Table 7: Hospital CON applications by type and year 24 Table 8: Median days of CON processing time 25 Key Findings of Study 26 Recommendations 29 1. Ensure that consumers affected by hospital closures or elimination of key hospital services are notified and engaged 30 2. Improve transparency, consumer engagement and accountability when health systems propose takeovers of community hospitals 35 3. Increase consumer representation on the PHHPC and improve the overall transparency and consumer engagement of the current NYS CON process 41 4. Ensure CON-approved projects protect access to timely, affordable care and advance identified local and state health planning goals 45 Conclusion 51 Table 9: States with consumer-friendly CON policies and procedures 52 Appendices: A. CASE STUDY: The Dismantling of Cornwall Hospital 53 B. CASE STUDY: The Transformation of Mount Sinai Beth Israel 63 C. Improving Consumer Access to CON Information on the DOH Website 73 D. Hospital data: Sources, methods and analysis 84 EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 3 Acknowledgments S upport for this work was provided by the New York State Health Foundation (NYSHealth). The mission of NYSHealth is to expand health insurance coverage, increase access to high-quality health care services, and improve public and community health. The views presented here are those of the authors and not necessarily those of NYSHealth or its directors, officers and staff. The authors wish to thank the project’s sponsors for their support and assistance throughout the study, particularly David Sandman and Amy Shefrin from NYSHealth. The study team also wishes to acknowledge staff of the New York State Department of Health and members of the New York State Public Health and Health Planning Council for providing valuable insights to inform this study. Authors of this report include: Lois Uttley, MPP, founded the MergerWatch Project in 1997 to protect patients’ rights and access to care when hospitals merge. She has authored numerous articles and reports on hospital consolidation, including a 2016 study When Hospitals Merge: Updating State Oversight to Protect Access to Care. She has served as Director of Public Affairs for the New York State Department of Health, Vice President of the Education Fund of Family Planning Advocates of NYS, President of the Public Health Association of NYC and Chair of the Action Board of the American Public Health Association. She serves on the steering committee of the statewide Health Care for All New York coalition. Ms. Uttley earned a Master’s in Public Affairs and Policy from the Nelson A. Rockefeller College of Public Affairs and Policy of the University at Albany, was a National Urban Fellow and teaches in the Master’s in Health Advocacy Program at Sarah Lawrence College. In February of 2018, she became Program Director for the Women’s Health Program of Community Catalyst. Fred Hyde, MD, JD, MBA, is a consultant to hospitals, medical schools and physicians, as well as to unions, community groups and others interested in the health of hospitals, health care facilities and organizations. He has served twice as chief executive of a non-profit hospital, as chief executive of an ambulatory surgery center, as chief executive of an HMO, as vice president of a major university teaching hospital, as director of a medical school faculty practice plan, and consulting manager of physician practices. Dr. Hyde has taught hospital management, health care financial management and medical technology reimbursement and regulation at Columbia University’s Mailman School of Public Health (where he is a Clinical Professor) and at its Business School; at Fordham’s Global Healthcare Innovation Management Center; and at Georgetown’s School of Nursing and Health Studies. He served on the Governor’s Task Force on Certificate of Need in Connecticut. His received undergraduate, medical and law degrees from Yale and a business degree from Columbia. Patricia HasBrouck, MBA, is an independent health care consultant with experience in financial modeling, strategic planning, regulatory support, policy research and evaluation, health care financing and managed care. She earned an MBA from Northwestern University’s Kellogg School of Management and a BS in industrial engineering from Stanford University. Emma Chessen received her Master’s in Public Health in May 2018 from Columbia University’s Mailman School of Public Health. She received a BA from the University of Pennsylvania. Also contributing to the design of the study and initial research were Christine Khaikin, JD, Elisabeth Hamlin-Berninger, MHA, and Morgan Beatty, a dual-degree medical and public health student at Columbia University. Graphic design of this report was provided by Brucie Rosch. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 4 Executive Summary O ver the last 20 years, changes in reimbursement policies and medical advances have altered the hospital landscape nationwide and in New York. Three trends have dominated the hospital industry: 1) downsizing and closing of community hospitals, 2) hospital consolidation and creation of large regional health systems, accompanied by 3) movement of some medical care from hospitals into lower-cost outpatient settings. The impact of these trends can be seen in the findings from MergerWatch research: • Forty-one New York hospitals have closed all of their inpatient services over the last 20 years. Some hospitals have been converted to use as outpatient centers, medical offices, nursing homes or rehabilitation centers, while others have been turned into condominiums or abandoned. • The number of hospital beds being decertified across New York State jumped from 102 in 2015 to 440 in 2017, with the largest losses occurring in medical/surgical, psychiatric, maternity and pediatric care, according to New York State Department of Health data. • A group of large non-profit health systems has been steadily moving to manage or acquire many of the remaining community hospitals in the state. The 12 largest systems now control half of all the acute care hospitals in New York and 70 percent of the inpatient acute care beds. Four mega-systems – New York-Presbyterian, Northwell Health, NYU Hospitals Center and Mount Sinai Health System – have accumulated multiple hospitals and a combined total of $14.2 billion in net assets, giving them significant economic power and ability to shape the health system. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 5 With all this change occurring in the hospital landscape, do New Yorkers have a say in hospital closure and consolidation decisions? How are New York’s health consumers being notified of proposed changes to their local hospitals? Are they being afforded the opportunity to comment on how their access to timely, affordable care might be affected? Are state regulators able to ensure that proposed hospital mergers, closings, downsizing and movements of care to outpatient settings benefit consumers and do not create THE CERTIFICATE gaps in access to care? Equally important, how are regulators ensuring that these consolidations do not exacerbate existing OF NEED PROCESS health disparities or unnecessarily increase health care prices? PROVIDES AN The state Certificate of Need (CON) process provides an OPPORTUNITY TO opportunity to engage community residents in these decisions ENGAGE COMMUNITY that can dramatically affect their lives. In 1964, New York established RESIDENTS IN THESE the first-in-the nation CON process at a time when new hospitals were being constructed with the aid of the federal Hill-Burton Act. DECISIONS THAT Demand for hospital care was fueled by the growth of third-party CAN DRAMATICALLY private health insurance and by the enactment of Medicare and AFFECT THEIR LIVES. Medicaid in 1965. Policymakers were concerned that unregulated construction of new hospitals and expansion of existing facilities would lead to unnecessary construction and duplication of expensive equipment, resulting in higher-than-necessary health care costs. CON was also intended to protect a hospital’s “franchise” from competition that could hurt its ability to repay loans. The CON program has required hospitals and other institutional health providers to seek state approval for construction, expansion, renovation and establishment of new facilities and services. In the new era of hospital consolidation, is New York’s 54-year-old CON process effective in working to notify the public, meaningfully engage consumers and protect community access to timely, affordable care? A year-long study by MergerWatch, funded by the New York State Health Foundation, set out to find the answer.1 The study found that New York State Department of Health staff and leaders of the Public Health and Health Planning Council (PHHPC), which reviews the most important CON applications (those designated for full review), have taken some positive steps in recent years to improve CON review. However, the study concluded that the CON process still lacks transparency, consumer engagement and sufficient oversight of health care providers in this rapidly changing landscape. A 2012 PHHPC report made a number of significant suggestions about ways to reform the CON process. However, some of those suggestions were never acted upon or were implemented in ways other than what the PHHPC had envisioned. Moreover, since that 2012 PHHPC report, the 1. The study was focused on oversight of acute care hospitals and health systems, and did not review the processing of CON transactions involving nursing homes or home care agencies. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 6 pace of change in the hospital sector has quickened. New York’s Delivery System Reform Incentive Payment (DSRIP) Medicaid redesign program has put large systems with ample administrative capacity at an advantage and has pushed stand-alone community hospitals to join larger hospital systems. Such marriages of community hospitals and dominant systems come to the CON application process as virtual “done deals,” encouraged by state officials and sweetened with state grants. PHHPC members and DOH staff are engaged in another round of examining how to modernize CON and other state health regulatory oversight processes, with PHHPC Chair Jeffrey Kraut suggesting that the Department of Health “is trying to solve new millennial challenges with a regulatory and CON chassis that is 30-40 years old.” At a PHHPC strategic planning retreat in September 2017, Kraut (who is also Executive Vice President of Strategy and Analysis for the Northwell Health system) THE CON PROGRAM described a need to “articulate a different vision of a new DOES NOT ADEQUATELY framework for DOH to fulfill its mission of accountability and INFORM OR ENGAGE oversight, to have transparency and public engagement.”2 HEALTH CONSUMERS This MergerWatch study is intended to offer valuable suggestions on how to ensure that CON reform enhances ABOUT HOSPITAL transparency and consumer engagement, and that it CONSOLIDATION, protects access to affordable care for vulnerable health DOWNSIZING OR consumers. The study concludes that the CON program as CLOSING THAT currently operated in New York State does not adequately inform or engage health consumers about hospital COULD AFFECT THEIR consolidation, downsizing or closing that could affect ACCESS TO TIMELY, their access to timely, affordable care. AFFORDABLE CARE. Key Findings • No state-mandated system exists to notify and engage affected consumers in advance when their community hospitals will be closing, downsizing, transforming into outpatient settings and/or joining a large health system that will assume decision-making over the local facility. Public hearings are not required in the affected communities or at convenient times for consumers in advance of a hospital closing, downsizing or other transaction with a major impact on the facility and community. 2. Jeffrey Kraut, “The Role of the PHHPC in Public Health and Health Planning; Looking Back and Looking Forward,” September 6, 2017, http://www.totalwebcasting.com/view/index.php?func=VIEW&id=nysdoh&date=2017-09-06&seq=1 EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 7 • Hospital closings and some types of downsizing (such as eliminating the emergency department or maternity services) are not subject to “full review” by the PHHPC in a public meeting. Instead, many are being handled through “limited review” CON applications that are decided by state DOH staff. • Increasing numbers of CON applications are being decided out of public view through “administrative review” and “limited review” or through simple “notice” to the state. State processing of CON applications has been streamlined and shortened at the urging of hospitals, making it more difficult for affected consumers to learn about and comment on proposals. • User-friendly information is difficult to find on the NYS DOH website concerning individual CON applications, the CON review process or how to submit comments on pending applications. • PHHPC meetings and their agendas are not NO PROCESS HAS widely publicized. The meetings are held only on weekdays in Albany or New York City, creating BEEN DEVISED TO hurdles for consumers who would have to take time SEEK AND CONSIDER off from work and travel to present comments. There frequently is no response when the committee chair THE VIEWS OF LOCAL asks, “Are there any comments from the public?” HEALTH OFFICIALS • The public’s voice is not well represented on AND AFFECTED the PHHPC itself, with only a single seat being designated for a consumer representative COMMUNITIES (and that seat having been vacant since ON PENDING CON mid-2016). This is in stark contrast to public representation in some other states, where APPLICATIONS. health care provider representation is severely limited on CON-decision making bodies and the chair must be a consumer. • Since the demise of all but one local Health System Agency (HSA), no replacement process has been devised to seek and consider the views of local health officials and affected communities on pending CON applications. • Until now, CON decision-making has not included consideration of whether proposed hospital transaction would advance identified local or state health planning goals, such as those articulated in the Prevention Agenda. In June of 2018, the “full review” CON applications for general hospitals will begin to ask applicants about how the proposed project advances local Prevention Agenda priorities, which will represent an important step in the right direction. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 8 • Publically-available summaries of CON applications often do not explain how the project would meet the needs of medically-underserved people, such as those who are low income, racial and ethnic minorities, women or people with disabilities.3 • Also unaddressed in CON decision-making is whether a proposed consolidation could increase the price of health care in affected communities. • No CON review or public notification is required when health systems initiate takeovers of local hospitals by using an unregulated “passive parent” mechanism found in no other state. When systems do submit CON applications to assume “active parent” governance of hospitals (which gives them direct authority over the hospital’s budget and management), applicants are not required to explain how local residents would be given a continuing voice in hospital decision-making (such as through seats on the board). “WE HAVE NOT HAD “We look with a microscope at individual applications with criteria that are decades old, and have not had a discussion here about the A DISCUSSION ABOUT implications of consolidation and should there be expectations of THE IMPLICATIONS consolidation,” said Dr. John Rugge, who is Chair of the PHHPC’s OF CONSOLIDATION.” Planning Committee and Founder, Executive Chairman of the Hudson Headwaters Health Network.4 “For example,” he asked, “should there – DR. JOHN RUGGE be expectations about local governance?” Summary of Recommendations How can New York’s CON process be made more transparent and engaging of consumers in the new era of hospital consolidation? The study produced four categories of recommendations about how to make the process more transparent, drawing on practices found in other states and in a few cases on recommendations from the 2012 PHHPC report that were not acted upon: 1. Ensure that consumers affected by hospital closures or elimination of key hospital services are notified and engaged. We propose (a) requiring 90 days advance notice and provision of a proposed closure plan, as well as (b) a public hearing in the affected community at least 60 days in advance and (c) full review of these transactions in public meetings by the Public Health and Health Planning Council (PHHPC), with special attention to the potential effect on health consumers who are low-income, racial and ethnic minorities, women, people with disabilities, the elderly, and members of other underserved groups.5 3. As spelled out in Section 709.1, determination of need pursuant to section 2802 of the Public Health Law, accessed at https://regs.health.ny.gov/book/export/html/45945 4. Dr. John Rugge, in comments to the Public Health and Health Planning Council on December 7, 2017, as reported in the minutes of the meeting. 5. Section 709.1 - Determination of public need pursuant to section 2802 of the Public Health Law EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 WE URGE FULL 9 DISCLOSURE BY 2. Improve transparency, consumer engagement and accountability HEALTH SYSTEMS when health systems propose takeovers of community hospitals. We urge full disclosure by systems of plans to downsize or transform OF PLANS hospitals they are acquiring, followed by post-transaction reporting TO DOWNSIZE and monitoring to ensure accountability to affected consumers. OR TRANSFORM We urge a requirement for public hearings in affected communities to ensure consumer engagement, especially for consumers who are HOSPITALS THEY medically underserved or could become so as a result of the transaction. ARE ACQUIRING. We propose eliminating health systems’ use of an unregulated mechanism (called “passive parent”) to begin takeovers of local hospitals without transparency or accountability to affected consumers. 3. Increase consumer representation on the PHHPC and improve the overall transparency and consumer engagement of the current NYS CON process. We urge the addition of more consumer representatives to the PHHPC to better ensure consumer views are heard and considered, and to counterbalance the presence of health system representatives. We recommend improvements to the NYS DOH website to make it easier for consumers to find hospital CON applications and to submit comments on them. We recommend requiring CON applicants to submit Letters of Intent 30 days prior to the filing of a CON, and posting those LOIs promptly on the DOH website. 4. Ensure CON-approved projects protect access to timely, affordable care and advance identified local and state health planning goals. We recommend that CON applicants be required to state how their projects would address identified state and local health planning goals, such as the Prevention Agenda, and advance health equity by improving access to care for medically-undeserved health consumers. We also suggest that applications for large-scale transactions, especially hospital consolidations, be required to project the impact of the transactions on the price of health care services. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 10 The Changing Hospital Landscape A cross the nation, the pace of hospital consolidation is quickening and health care delivery is transforming. Historically independent community hospitals are joining regional and national health systems. The number of hospital mergers and acquisitions nearly doubled between 2010 and 2015.6 In 2017, there were 115 hospital mergers and acquisitions, the highest number in recent history.7 Some financially stressed community hospitals are downsizing, converting into urgent care centers or freestanding emergency departments, or closing. Especially hard hit are rural hospitals, more than 119 of which have closed since 2005.8 Some urban hospitals, particularly those that are publicly owned and disproportionately serve uninsured and Medicaid patients, are also struggling. 6. “Hospital Merger and Acquisition Activity Up Sharply in 2015, According to Kaufman Hall Analysis,” KaufmanHall, Skokie, Ill., January 20, 2016, accessed at https://www.kaufmanhall.com/news/hospital-merger-and-acquisition-activity-sharply-2015- according-kaufman-hall-analysis 7. “2017 in Review: The Year M&A Shook the Healthcare Landscape” (Kaufman Hall, 2018), https://www.kaufmanhall.com/resources/2017-review-year-ma-shook-healthcare-landscape 8. Data from North Carolina Rural Health Research Program, cited in Mincer, J., “More hospital closings in rural America add risk for pregnant women,” Reuters, July 18, 2017, accessed at https://www.reuters.com/article/us-usa-healthcare-rural/more-hospital- closings-in-rural-america-add-risk-for-pregnant-women-idUSKBN1A30C5 EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 11 Many externalities are driving these trends, including clinical advances that make it possible to safely move treatment from inpatient hospitals to ambulatory sites. Other factors include payer demand (from private insurers, employers and government payers) for “value-based” care that necessitates capital investment in expensive technology (such as electronic medical records) to support collaboration among health care providers along the continuum of care, as well as administrative capacity to negotiate and manage value-based contracts. These requirements have proved challenging for smaller hospitals with limited administrative capacity and access to capital. Health systems have also acquired hospitals to increase market share, thereby gaining negotiating leverage with health insurers, as well as a larger patient PAYER DEMANDS base to feed larger tertiary care hospitals within each system. For rural and some urban hospitals, challenges may be precipitated by FOR “VALUE-BASED prohibitive costs to renovate aging hospital buildings, lack of access CARE” HAVE PROVED to capital and high percentages of patients who are uninsured or CHALLENGING FOR who are insured by (lower paying) Medicaid. SMALLER HOSPITALS What has been happening in New York State? A total of WITH LIMITED 41 hospitals have closed general inpatient services over the last 20 years, MergerWatch research has found. Sixteen of those ADMINISTRATIVE hospital campuses have been converted to non-medical uses – such CAPACITY. as condominiums, assisted living facilities, office space and schools – or are abandoned. The remaining 25 former hospital sites continue to be used for a range of medical services, such as clinics, labs, ambulatory surgery centers, urgent care centers, psychiatric treatment facilities, nursing homes, and drug or alcohol rehabilitation centers. (See the list of closed hospitals on page 12.) More than half of these closings (23 hospitals or 56 percent) have occurred since 2007. Some were recommended in 2006 by a state hospital “rightsizing” initiative called the Commission on Health Care Facilities in the 21st Century (known the Berger Commission, after its Chairman, Stephen Berger). The commission estimated that the state had excess capacity of more than 10,000 hospital beds, which it said was enormously costly. The Commission targeted five hospitals in New York City for closure: St. Vincent’s Midtown Hospital and Cabrini Medical Center in Manhattan, Victory Memorial in Brooklyn, New York Westchester Square Medical Center in the Bronx and Parkway Hospital in Queens. Four upstate hospitals were targeted for closure: Millard Fillmore Gates Circle in Buffalo, St. Joseph’s in Cheektowaga, Bellevue Women’s Hospital in Niskayuna and Community Hospital in Dobbs Ferry. Nearly all of the recommended closings occurred within a year or two of the Commission’s report. The Commission also recommended that 48 other hospitals reconfigure, either by merging with nearby facilities or by converting hospital beds to other uses. Many of these reconfigurations have taken place, or are in process. EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 12 TABLE 1 New York hospitals closed for inpatient services since 1997 YEAR OF HOSPITAL NAME LOCATION CURRENT USE OF FORMER HOSPITAL FACILITY/CAMPUS CLOSING NON-MEDICAL USE OF FORMER HOSPITAL CAMPUS Beth Israel Medical Center- Herbert and Nell Singer Division Manhattan 2004 Demolished and luxury condos built in place Cabrini Medical Center Manhattan 2008 Converted to residential units (2013) Catholic Med CTR of Brooklyn/Queens- Queens (Jamaica) 2009 Residential units planned Mary Immaculate Hospital Catholic Med CTR of Brooklyn/Queens- Queens (Elmhurst) 2009 In process of conversion to residential St. John's Queens Hospital Genesee Hospital Rochester 2001 Demolished and office complex built in place Kaleida Health Adult Hospital- Buffalo 2012 Demolished and senior assisted living complex built in place Millard Filmore Gates Washington County Mary McClellan Hospital 2003 Abandoned (Cambridge) New York United Hospital Port Chester 2005 Abandoned, plans for mixed use development Orange Regional Medical Center- Middletown Campus Middletown 2011 Repurposed as campus for Touro College, osteopathic medical school Parkway Hospital Queens (Forest Hills) 2008 Abandoned for several years, purchased and undergoing DEC review Salamanca Hospital District Authority Salamanca 1998 Demolished (2011) Sheehan Memorial Hospital Buffalo 2012 Office space (2013) Staten Island University Hospital-Concord Division Staten Island 2009 Public School St. Agnes Hospital White Plains 2003 Luxury assisted living residence (2013) St. Vincent's Midtown Hospital Manhattan 2007 Partly abandoned, partly residential (2014) St. Vincent's Hospital and Medical Center of New York Manhattan 2011 Demolished and luxury condos built in place SOME TYPE OF MEDICAL SERVICES ON FORMER HOSPITAL CAMPUS Albert Lidley Lee Memorial Hospital Fulton 2009 Urgent care center Amsterdam Memorial Hospital Amsterdam 2014 10 rehab beds, ambulatory services Bayley Seton Hospital Staten Island 2004 Small portion of property used for chemical dependency treatment Brunswick Hospital Center Amityville 2003 Inpatient Psychiatric Hospital Our Lady of Victory Hosptial of Lackawanna Lackawanna 2002 Nursing home Faxton- St. Lukes Healthcare- Faxton Division Utica 2003 Ambulatory surgery, urgent care, other ambulatory care services Inter-community Memorial Hospital at Newfane Newfane 2014 Ambulatory care services Lakeside Memorial Hospital Brockport 2013 Free-standing Emergency Department and ambulatory care services Long Beach Medical Center Long Beach 2013 Free-standing Emergency Department Long Island College Hospital Brooklyn 2014 Free-standing Emergency Department run by NYU Langone Manhattan Eye Ear & Throat Hospital New York 2007 Ambulatory surgery and other ambulatory services Massapequa General Hospital Seaford 2000 Medical offices and school Myers Community Hospital Sodus 2003 Medical offices New York Westchester Square Medical Center Bronx 2013 Free-standing Emergency Department run by Montefiore North General Hospital New York 2010 Ambulatory care services and medical residency program North Shore University Hospital at Syosset Westbury 1997 Ambulatory surgery Peninsula Hospital Center Queens (Far Rockaway) 2012 Nursing and Rehabilitation Center (2014) St. Clares Hospital- McClellan Division Schenectady 2011 Ambulatory care services St. John's Riverside Hospital- Park Care Pavilion Yonkers 2001 Inpatient chemical dependence rehab and detox St. Luke's Cornwall Hospital- Cornwall Campus Cornwall 2017 Medical offices St. Mary's Hospital of Brooklyn Brooklyn 2005 Transitioning to nursing home Tri-Town Regional Hospital Sidney 2005 Free-standing Emergency Department Union Hospital of the Bronx Bronx 1998 Ambulatory care services, dental, mental health, urgent care, PT/OT United Memorial Medical Center- Batavia 2000 Ambulatory care services Bank Street Campus AKA St. Jerome Victory Memorial Hospital Brooklyn 2008 Urgent care center EMPOWERING NEW YORK CONSUMERS IN AN ERA OF HOSPITAL CONSOLIDATION FILED: NEW YORK COUNTY CLERK 02/07/2024 02:07 PM INDEX NO. 151136/2024 NYSCEF DOC. NO. 3 RECEIVED NYSCEF: 02/07/2024 13 The number of hospital beds in New York has been steadily decreasing as facilities are downsized and transformed. NYS DOH data on hospital bed changes from 2015-2017 reveal a sharp jump in the number of beds lost, from 102 in 2015 up to 474 in 2017. The greatest reductions have been in the number of traditional medical/surgical beds, which decreased by 402 beds over the three-year period. The next largest reduction was in psychiatric care, which decreased by 202 beds, followed by maternity care (down 88 beds) and pediatrics (down 80 beds). TABLE 2 A snapshot of 2017 bed changes New York hospital beds changes by type of care and region of the by category 2015-17 state is shown in Table 3 on page (with largest categories of bed losses highlighted) 14. Most of the 2017 reduction was in beds classified as medical/ HOSPITALS 2015 2016 2017 Total surgical, maternity, psychiatric, or BED CATEGORY physical medicine & rehabilitation. AIDS N/A N/A -13 -13 Regions experiencing the greatest Bone Marrow Transplant 0 0 2 2 losses in beds included New York Chemical Dependency, Detox -31 0 -12 -43 City, the Northeast region Chemical Dependency, Rehab 0 -30 37 7 (Capital District and north) Coma Recovery -4 0 -5 -9 and Long Island. Coronary Care 0 -7 -10 -17 When Charles Abel, Deputy Intensive Care 25 33 -2 56 Director of the NYS DOH’s Maternity Beds 0 -4 -84 -88 Center for Health Facility Planning, addressed this reduction in beds Medical/Surgical -89 -131 -182 -402 at the February 8, 2018, PHHPC Neonatal Intensive Care 55 16 6 77 meeting, he said that “these are Neonatal Intermediate Care -19 16 -14 -17 beds that have proven not to Neonatal Continuing Care 0 -2 -3 -5 be needed.” He added, “Some of Pediatric -7 -36 -37 -80 those have come out as a result Pediatric ICU 8 0 -5 3 of hospital construction projects where the hospital does not see Physical Medicine & Rehabilitation 19 -32 -58 -71 the need to construct a new wing Prisoner