NY health system sues to fight hospital closure

A Buffalo-area hospital chain has filed a lawsuit to stop the forced closure of one of its facilities, which was targeted as part of a state-wide downsizing of the hospital and nursing home industry. The facility, 132-bed St. Joseph Hospital of Cheektowaga, New York, is part of the four-hospital Catholic Health System (CHS), whose other services include ten primary care centers, six diagnostic centers, an ambulatory surgery center and seven long-term care facilities. St. Joseph has been recommended for closure by the Commission on Health Care Facilities in the 21st Century, which was tasked by the state legislature with improving the efficiency of the state's healthcare system. The commission is recommending that a total of nine of the state's hospitals be closed, as part of changes impacting 4,200 hospital beds within the state. While the legislature has yet to pass on the plan, state governor George Pataki has given it his formal approval. If the state legislature approves the plan, it becomes law.

In public statements contesting the closure, CHS CEO Joseph McDonald noted that St. Joseph had a surplus of $2 million for the first three quarters of 2006, suggesting that it was in no way a failing institution. The hospital's patients are 68 percent Medicare-insured, which spares it the state/Medicaid dependence some hospitals face. In addition, church leaders noted that CHS has already taken capacity out of the system, closing two hospitals on its own. Executives warned, as well, that the community would have trouble absorbing the 800 workers who would become unemployed by the closure.

In court papers, meanwhile, CHS executives cut to the chase, suggesting that competitor Kaleida Health would gain substantially if St. Joseph closes. CHS has also contended that its secular competitor got greater access to hearings before the commission, giving it an advantage in the decision-making process. The health system is also arguing that the forced closure is unconstitutional and violates its right to procedural due process. All told, there's a lot at stake here, and possibly some national precedents to be set.

Get more background on the suit:
- read this Modern Healthcare account
- check out this this coverage from Business First of Buffalo
- see this update from the Diocese of Buffalo

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