Hospital Begins Shutting Down - @ JEMS.com


Hospital Begins Shutting Down

Unable to find a buyer, the Century City medical facility files for liquidation.


 
 

Daniel Costello | | Sunday, August 24, 2008


LOS ANGELES -- Financially troubled Century City Doctors Hospital gave up hope of finding a buyer and began shutting down Friday, according to hospital executives. Officially, the facility said it would cease operations late next week.

The hospital's emergency room -- a key element of the county's increasingly fragile emergency safety net -- will be closed today, and about 30 remaining patients will be discharged or transferred to nearby facilities beginning this weekend.

Regionally, 14 emergency rooms have been closed in the last five years, including 10 in Los Angeles County. After the closure, there will be 74 ERs remaining in the county.

On Friday, the hospital filed for financial liquidation under Chapter 7 of the U.S. Bankruptcy Code. Employees said they didn't get paid this week; other employees said payroll checks they received had bounced.

Hospital executives said they were petitioning the federal Bankruptcy Court to use emergency funds to pay employees as early as next week but acknowledged that they might not be able to do so.

"I haven't been paid in two weeks and I'm afraid I'm just not going to get paid," Tamara Tobin, a nursing assistant, said as she arrived at the hospital Friday.

The 176-bed facility, on Century Park East in the Century City Medical Plaza, has tried for months to improve its finances but has struggled to pay its growing debt, which the hospital estimated in a recent interview with The Times at more $60 million.

"It's really unfortunate" the hospital is closing, said Pat Wolfram, its interim chief executive. "Even this morning, we were trying to get a buyer and remain open but it just didn't happen. This is a great hospital and it's very sad."

Carol Meyer, director of governmental affairs at the Los Angeles County Department of Health Services, said the loss of the hospital's emergency room in particular would be a particularly difficult blow to the region's healthcare system.

"This means more than 1,000 emergency patients a month will now have to be treated elsewhere," she said. "Right now, every loss of an ER is a major loss to our whole system."

Meyer said the county began informing local emergency agencies including the Los Angeles Fire Department that Century City's ER was shutting down immediately.

Until recently, Century City Doctors Hospital's financial prospects appeared to be good. The hospital, previously known as Century City Hospital, was closed in April 2004 by Dallas-based Tenet Healthcare Corp.

It was then acquired by Beverly Hills-based Salus Surgical Group, which invested about $100 million to renovate the facility. Salus did not return calls seeking comment.

The hospital reopened in October 2005 and featured cutting-edge technology including an all-digital medical records system and top-flight amenities such as wireless Internet in every room, gourmet meals that patients could order any time and movies on demand.

But the facility struggled financially from the start. The largest problem has been a lack of patient volume, administrators said. It has recently been averaging about 60 beds filled each day -- far fewer than what's needed, financially, especially considering its oversize debt.

Last week, the hospital's former chief executive, John Reynolds, resigned and cleaned out his offices. Hospital executives asked staff members to keep operating rooms locked this week, fearing that creditors could arrive at the facility seeking to repossess equipment.

Since 1996, 70 community hospitals have closed across the state, with a disproportionate share -- more than 50 -- in Southern California. Some have closed in areas where there was too much hospital capacity. Others have closed in areas with large numbers of underinsured and uninsured patients, leaving access to hospital care in short supply in those areas.

Some industry experts fear the trend is worsening and increasingly afflicting crucial areas and facilities.

Four years ago, Robert F. Kennedy Medical Center in Hawthorne shut down. Martin Luther King Jr.-Harbor Hospital in Willowbrook closed a year ago when the federal Medicare and Medicaid agency pulled half the hospital's funding. That closure followed nearly four years of failed attempts to reform the troubled institution, formerly known as Martin Luther King Jr./Drew Medical Center.

Brotman Medical Center in Culver City filed for bankruptcy protection last fall.

Hospital experts say that as many as two-dozen other area hospitals are under severe financial strain.

Century City Doctors Hospital, located in a relatively affluent area where hospitals are not as likely to be overburdened with high numbers of uninsured and underinsured patients, was thought to be in better shape. Its financial troubles are raising worries from industry watchers that an even broader shakeout than expected could be in the future for the regional hospital system.

Wolfram, the hospital's acting chief executive, said there was a small chance that one remaining interested party might make a bid for the hospital. If so, the hospital will try to reorganize its debts and reopen, she said.

"There may be a potential buyer," she said. "He's in the process of looking at it and may decide something next week."




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