The wide-ranging impact of hospital closures

Clinicians struggle to balance priorities


On June 26, 2019, American Academic Health System and Philadelphia Academic Health System announced that Hahnemann University Hospital, a 496-bed tertiary care center in North Philadelphia in operation for over 170 years, would close that September.

The emergency department closed 52 days after the announcement, leaving little time for physicians and staff to coordinate care for patients and secure new employment. The announcement was also made right at the beginning of the new academic year, which meant residents and fellows were forced to find new training programs. In total, 2,500 workers at Hahnemann, including more than 570 hospitalists and physicians training as residents and fellows, were displaced as the hospital closed – the largest such closing in U.S. history.

For most of its existence, Hahnemann was a teaching hospital. While trainees were all eventually placed in new programs thanks to efforts from the Accreditation Council for Graduate Medical Education (ACGME), some of the permanent staff at Hahnemann weren’t so lucky. A month after the announcement, Drexel University’s president told university employees that 40% of the staff who worked at Hahnemann would be cut as a result of the closing. Drexel, also based in Philadelphia, had long had an academic affiliation agreement for training Drexel’s medical school students as a primary academic partner. Overall, Drexel’s entire clinical staff at Hahnemann was let go, and Tower Health Medical Group is expected to hire about 60% of the former Hahnemann staff.

Kevin D’Mello, MD, FACP, FHM, a hospitalist and assistant professor of medicine at Drexel University, said residents during Hahnemann’s closure were essentially teaching themselves how to swim. “There were just no laws, no rules,” he said.

The vast majority of programs accepting applications from residents at Hahnemann were sympathetic and accommodating, he said, but a few programs applied “pressure tactics” to some of the residents offered a transfer position, despite graduate medical education rules in place to prevent such a situation from happening. “The resident says: ‘Oh, well, I’m waiting to hear from this other program,’ ” said Dr. D’Mello. “They’d say: ‘Okay, well, we’re giving you a position now. You have 12 hours to answer.’ ”

Decision makers at the hospital also were not very forthcoming with information to residents, fellows and program directors, according to a recent paper written by Thomas J. Nasca, MD, current president and CEO of ACGME, and colleagues in the journal Academic Medicine (Nasca T et al. Acad Med. 2019 Dec 17. doi: 10.1097/ACM.0000000000003133). When Dr. Nasca and colleagues went to investigate the situation at Hahnemann firsthand, “the team found that residents, fellows, and program directors alike considered their voices to have been ignored in decision making and deemed themselves ‘out of the loop’ of important information that would affect their career transitions.”

While the hospital closed in September 2019, the effects are still being felt. In Pennsylvania, the Medical Care Availability and Reduction of Error Act requires that hospitals and providers have malpractice insurance, including tail insurance for when a doctor’s insurance policy expires. American Academic announced it would not be paying tail insurance for claims made while physicians were at Hahnemann. This meant residents, fellows and physicians who worked at Hahnemann during the closure would be on the hook for paying their own malpractice insurance.

Dr. William W. Pinsky, president and CEO of the Educational Commission for Foreign Medical Graduates

Dr. William W. Pinsky

“On one hand, the risk is very low for the house staff. Lawsuits that come up later for house staff are generally dropped at some point,” said William W. Pinsky, MD, FAAP, FACC, president and CEO of the Educational Commission for Foreign Medical Graduates (ECFMG). “But who wants to take that risk going forward? It’s an issue that’s still not resolved.”

The American Medical Association, Association of American Medical Colleges (AAMC), the Philadelphia County Medical Society, and other medical societies have collectively put pressure on Hahnemann’s owners to pay for tail coverage. Beyond a Feb. 10, 2020 deadline, former Hahnemann physicians were still expected to cover their own tail insurance.

To further complicate matters, American Academic attempted to auction more than 570 residency slots at Hahnemann. The slots were sold to a consortium of six health systems in the area – Thomas Jefferson University Hospitals, Einstein Healthcare Network, Temple University Health System, Main Line Health, Cooper University Health Care, and Christiana Care Health System – for $55 million. The Centers for Medicare & Medicaid Services opposed the sale, arguing that the slots are a contract that hospitals enter into with CMS, rather than an asset to be sold. An appeal is currently pending.

The case is being watched by former physicians at Hahnemann. “American Academic said, ‘If we don’t get this $55 million, we’re not going to be able to cover this tail insurance.’ They’re kind of linking the two things,” said Dr. D’Mello. “To me, it’s almost like putting pressure to allow the sale to happen.”


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