Beth Israel: Not Hopeless, but Hopeless-ish

By Alec Pruchnicki, M.D.

I’ve worked in many hospitals over the years and was affiliated with Mt. Sinai until a few years ago. So, maybe I can contribute a new perspective on the threatened closing of Beth Israel.

The Mount Sinai Healthcare System is extensive but it will always protect the mother ship, Mount Sinai Hospital on 5th Avenue and 98th St. When I worked at Mount Sinai affiliates around the city, it was always clear that main Sinai needs were paramount. You work for Sinai not with Sinai. 

Also, Mount Sinai administrators sometimes have a high opinion as to what they can accomplish. For example, the president said they would keep St. Vincent’s open. Once the actual debt of St. Vincent’s became apparent, they backed off and closed it. 

Lessons from St. Vincent’s

Except for the very end, St. Vincent’s, where I worked until its closing, was profitable. Years earlier it had affiliated with several small financially struggling Catholic hospitals around the city to form the St. Vincent’s Catholic Medical Centers system. The small hospitals would send patients to main St. Vincent’s and so balance their books and fatten up St. Vincent’s. But outer borough patients seldom came into the city. The deficits of the small hospitals increased and the overall debts of the entire system ballooned. St. Vincent’s was killed by its weak affiliates.

There were many arguments for its survival. It served the medical disasters from The Titanic, to the 1919 Flu Pandemic, the AIDS epidemic, and the 9/11 attack and might be needed for future emergencies. Its closing left a major gap in hospital care from the Battery to 59th street. 

Arguments for Closing Beth Israel

The main argument is that it is losing money, maybe as much as $150 million next year. The rest of the Sinai system will have to cover these losses. Why is it losing?

One reason is the extensive use of out-patient facilities for medical care that doesn’t need in-patient hospitalization. Nearby hospitals are already available– like Presbyterian Downtown, Bellevue, and NYU. 

Many Lower East Side and West Side residents opt to use the more prestigious East Side hospitals. When St. Vincent’s closed, about 10-12% of West Village residents used it as their primary hospital. When I was an attending at St. Vincent’s, locals would sometimes come into the emergency room, get initially treated and stabilized, and request transfer to their preferred hospital. 

The case of Arthur Schwartz illustrates this. When he had his heart attack he was taken to Beth Israel where he received excellent care that saved his life. He initially asked to go to NYU where his doctors and medical records were (Westview News, Feb. 2017 “Facing Death thinking about hospital closings” Arthur Schwartz). He wanted to avoid Beth Israel and he couldn’t be the only person in lower Manhattan who ever made this choice.

Arguments for Keeping Beth Israel Open

One frequent argument is that the Sinai system wants to close the hospital so it can sell the land it sits on. This doesn’t make sense. Hospitals that are profitable do not get closed, no matter how valuable the land is. For example, the Upper East Side hospitals (Lenox Hill, main Sinai, Cornell, and Sloan Kettering) sit on land that is much more valuable than Beth Israel’s. Those hospitals aren’t going anywhere. In fact, they have expanded. Mount Sinai Morningside (previously St. Luke’s Hospital) sold some property, but kept enough to stay open. It was not closed for its valuable land. If St. Vincent’s was profitable and paid its debt, it would still be open today.

Another argument is that Mount Sinai has transferred profit-making services away from Beth Israel to other parts of the Sinai system. Hospitals do this all the time. If a service can make money on the Lower East Side but make more money on the Upper West Side, there is a strong incentive to transfer it. It might make certain procedures more efficient and more effective. A service that is in continuous use develops an expertise in its staff. Maybe it can stay open more hours, so that it’s not closed like Beth Israel’s cath lab was when Schwartz first arrived. Instead of four small cath labs, maybe two would achieve a critical mass in terms of finances or quality. Large enough and it can become a “Center of Excellence” benefiting its reputation and profitability.

A major argument against its closing is that it violates state regulations and the Department of Health is required to approve closings. That’s what the law says, according to Schwartz and maybe some elected officials. But as Charles Dickens wrote many years ago, “the law is a ass,” and legal decisions sometimes lack common sense and are counterproductive. The courts, or the DOH, can make any decisions they want, but they don’t have to provide the funding to implement those decisions. When St. Vincent’s went into bankruptcy court, the legal decision was that it had to assume all the debt of its affiliated hospitals even though it was incapable of doing so. St. Vincent’s came out of court more in debt than it had before. Whether the deficits of Beth Israel are the results of a land grab, transfer of services, or just plain incompetence, that doesn’t change the fact that it is losing money. If funding isn’t available, the resulting red ink will be siphoned from the Mount Sinai system and not be available from the DOH or State budget.

What Can be Done?

Before Governor George Pataki’s administration, the state regulated the rates that Medicare, Medicaid, and the private insurance companies had to pay the hospitals and helped to keep them solvent. But the regulations were eliminated for the insurance rates and hospitals had to negotiate with each company for themselves. Closings started to accelerate. The state can still regulate Medicaid rates and maybe Medicare reimbursements. The DOH didn’t readjust St. Vincent’s enough, helping to doom the hospital.

There are also funds for “Safety Net” hospitals which serve low income or underserved populations. But this is a fixed amount and shifting funds to Beth Israel would take money from other hospitals, like Bellevue. Expanded Medicaid rates or Safety Net budgets would have to come from government sources and so far, that is not happening.

The New York State Health Act has the potential for insuring virtually every resident of the state, guaranteeing that hospitals will get payment for any patient coming in. But that is sitting in the legislature and not on the governor’s desk. Local politicians can push for this bill’s passage. It might even be developed to pay for global budgets where the state gives hospitals a total budget for the year, enough to cover all costs, and eliminate the need to bill for each patient with each insurance source. Other countries do this, and even the state of Maryland. 

If Beth Israel is closed, maybe nearby hospitals like Bellevue and NYU can get additional funds to care for former Beth Israel patients. Sinai itself can expand services at their large out-patient facility on Union Square and set up agreements with nearby hospitals for local emergency hospitalizations instead of uptown branches of Mt. Sinai.

New York Eye and Ear infirmary

There is one irreplaceable facility that must be saved at all costs. The New York Eye and Ear Infirmary on 14th Street is probably the best specialty hospital of its kind in the city and maybe country. I had my own cataract surgeries there and I’ve sent many of my patients to them with very good results. The Mount Sinai system promised to keep NYEEI open (for all that’s worth), but politicians and community leaders must start ensuring its finances now and not wait to see what happens. Local residents must utilize NYEEI for any appropriate surgery and not be lured by the reputation or advertising of uptown hospitals. 

The picture I’ve painted is bleak but I’ve tried to be realistic. I hope I’m wrong.