The reasons behind 7 hospital closures

From declining patient volumes, reimbursement challenges, spiraling labor costs and collapsed health system deals, many factors can contribute to hospitals shutting down.

Here are the reasons behind seven hospital closures in the last nine months: 

1. South City Hospital, a 178-bed facility in St. Louis, closed in August after struggling to overcome various financial challenges. The 154-year-old hospital had been under receivership for the past few months and began transferring patients to other facilities and winding down the facility Aug. 4. A substantial portion of the hospital's patients were uninsured or underinsured and many of its beds were dedicated to treating behavioral health patients. The hospital had changed owners multiple times in recent years, drifting in and out of bankruptcy court. 

2. Grand Rapids, Mich.-based Corewell Health will close its Lakeview, Mich.-based Spectrum Health Kelsey Hospital in October after a steady decline in admissions. The small, rural community hospital opened in 1962 and is having problems with aging infrastructure. The 16-bed hospital recorded only a handful of inpatients over five years and none in the last three. 

3. Eastern Niagara Hospital in Lockport, N.Y., closed June 17 after years of financial difficulties. Annual revenues that totaled more than $70 million a decade ago fell to under $35 million by 2021, with the hospital failing to turn a profit since 2015, according to The Buffalo News. In November 2019, the 115-year-old hospital filed for Chapter 11 bankruptcy protection and signed a management agreement with Buffalo, N.Y.-based Catholic Health. The system originally planned to keep Eastern Niagara open until replacement hospital Lockport Memorial could open, but funding challenges made it difficult to continue operations.

4. McLaren St. Luke's in Maumee, Ohio, closed May 8 and ceased all outpatient services after years of declining revenues and an unstable reimbursement environment. The hospital experienced "historic financial losses" that began long before COVID-19 that "ran into the millions each month," McLaren St. Luke's President and CEO Jennifer Montgomery said. Cincinnati-based Mercy Health acquired the hospital campus from Grand Blanc, Mich.-based McLaren Health Care on June 1 and worked with WellCare Physicians Group practices through the transition to maintain the continuity of patient care.

5. San Antonio-based Texas Vista Medical Center, part of Dallas-based Steward Health Care, closed May 1. The 325-bed hospital was already struggling financially when Steward acquired it in 2017, and the pandemic exacerbated its losses. Traditionally, the hospital served lower-income patients; nearly one-quarter of its patients cannot and do not pay for medical services, according to a March 1 news release. The closure resulted in 827 layoffs. 

6. Madera (Calif.) Community Hospital officially closed at midnight Dec. 30, after Livonia, Mich.-based Trinity Health's plan to buy the hospital fell through. Trinity already owns and operates Saint Agnes Medical Center in Fresno, Calif. In Madera County, one-fifth of residents live in poverty and many do not have health insurance, according to Cal Matters. Recent losses were tied to increases in day-to-day costs, which are difficult to cover over long periods, especially for hospitals with limited reserves. Significant expenses during the pandemic, including paying for expensive travel nurses, financially overwhelmed the hospital. The bankrupt hospital is looking to sell off assets and find a buyer to reopen the facility. 

7. St. Margaret's Health-Peru (Ill.) closed Jan. 28 citing various financial and economic factors as well as a cyberattack, which prevented the hospital from being able to bill or get paid in a timely way. The hospital also cited severe staff shortages. Peoria, Ill.-based OSF Healthcare is in the process of acquiring the hospital and aims to reopen it by Thanksgiving, according to Shaw Local News Network.


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