Brooklyn hospital’s closure brings charity care woes to light

emergencyBIZMOLOGY — Long Island College Hospital (LICH), sinking under financial pressure for more than a decade, may be shuttered within the next few months.

News has emerged this week that the State University of New York (SUNY) board of trustees is moving forward with plans to close the money-losing hospital. Despite objections from area workers and residents, as well as unions and politicians, SUNY plans to file an application with the state health board as early as next week to begin the process of ending inpatient operations at LICH.

The SUNY board’s vote for closure this week is the second such decision since the start of 2013; the board recast votes after pressure from state officials prompted it to hold additional public meetings. A press release from SUNY following the first vote in February stated that the closure would help the university avoid insolvency for the entire SUNY Downstate organization, which also includes several health and medical schools, the University Hospital of Brooklyn in East Flatbush, and an urgent care center in Bay Ridge.

LICH was acquired by SUNY in 2011 and was placed within the SUNY Downstate organization. Despite cost-cutting efforts at the ailing medical center, LICH is currently losing about $4 million per month, and the entire SUNY Downstate organization loses $12 million every month, according to a recent audit by the state comptroller’s office.

The report states that the Downstate system has operated at a loss since 2007 and that LICH has reported operating losses since 1994. It also indicates that the Downstate organization is on the brink of insolvency — listing reasons including acquisition costs and weak governance — and that it must implement strategic measures to reduce expenses and increase revenues within the next few months.

The impending closure of LICH is evidence that despite efforts by health care providers and government officials to turn around the state of the US health care system, hospitals that serve high levels of low-income and charity patients continue to struggle to survive.

LICH and other SUNY Downstate facilities, like other care providers in low-income areas across the nation, rely heavily on state funding for hospitals that serve disproportionate levels of charity and low-income patients. They are also extremely vulnerable to cuts in Medicare and Medicaid reimbursements.

Such facilities provide crucial services to communities, and when they are forced to shut down, a gap is left in care for poor neighborhoods. At the same time, these hospitals must also operate with extreme efficiency to stay afloat.

Anne Law

Anne Law has been a member of the D&B editorial department for more than a decade, providing content for the Hoover's and First Research products. She currently covers the health care and insurance industries for First Research. For industry news, follow Anne on Twitter.

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