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Latest News - May 2014

May 9, 2014
North Adams Regional Hospital was losing patients, according to Massachusetts Hospital Association
Source: Mass Live
By: Jim Kinney

North Adams Regional Hospital was averaging just eight inpatient discharges a day at the end of its life, the Massachusetts Hospital Association said this week.

The Hospital Association trade group spoke out in an effort to counter a Massachusetts Nurses Association report contending that the business of treating patients at North Adams Regional Hospital was profitable but that disastrous investments in senior living facilities caused its closure.

The nurses union says the dispute points to the need for more clear financial reporting by hospitals.

"It's been clear for quite a while now that North Adams Regional Hospital has been struggling really to find strategies to sustain health care services," said Tim Gens, executive vice president at Massachusetts Hospital Association.

Citing data from the state's Center for Health Information and Analysis, the same organization that provided some raw data for the nurses report, the Hospital Association said North Adams Regional Hospital had an occupancy rate of 24 percent in 2012, the second lowest among similar hospitals in the state. The state average for hospitals of this size was 61 percent.

North Adams Regional Hospital saw its inpatient volume decline 17.8 percent since 2008, compared with a statewide decline of 7.4 in the same time period. North Adams Regional Hospital also saw a 6.7 percent decline in outpatient volume during the same period. The average statewide for hospital of its size was less than a tenth of 1 percent.

The Massachusetts Nurses Association stands buy its analysis, said spokesman David Schildmeier. The union said North Adams Regional Hospital grew its profit by 435 percent from $4.3 million in 2000 to $23 million in 2012, proving that the community can support a full-service hospital, the Massachusetts Nurses Association said Tuesday.

While the profit from patient services fluctuated year-to-year, that profit from patient services, revenue from treating people minus what that treatment cost, averaged $9 million and never fell below $4.3 million a year, proving that patient care in northern Berkshire County was always a viable business model, the Massachusetts Nurses Association said.

But the Hospital Association said the nurses association misunderstood the data. Operating surplus, which is the difference between net patient service revenue and all operating expenses, is the real thing to look at, and shows the operating surplus for North Adams was $4.97 million in 2012, fell to $2.17 million in 2013 and in the first quarter of fiscal year, the hospital sustained an operating loss of more than $1 million.

Schildmeier reiterated the unions central thesis that $25 million in debt from the 1999 purchase of Sweetwood Continuing Care Community and Sweet Brook Transitional Care in Williamstown led to the hospital's demise.

Neither property made money and were both sold for $7 million in 2010.

Schildmeier said finances and patient numbers at North Adams Regional Hospital declined after management started cutting back in order to meet its debt obligation from the "Sweets."

Nurses themselves have complained about aggressive advertising campaigns mounted by competitor Southwestern Vermont Medical Center in Bennington while North Adams Hospital was still open.

Gens wouldn't speculate on that cause and effect reasoning.

"Any analysis of investment that hospitals made can only be completed if it is done in detail and its is done in context," Gens said. "We don't have that information and neither does the Massachusetts Nurses Association."

Schildmeier said the Nurses Association is pushing a public referendum in November that, if approved, increase reporting responsibilities make hospital finances in the state much more transparent.

Gens said the new law would be unnecessary

When parent entity Northern Berkshire Health Care closed the hospital March 28, it left 38,000 residents of northern Berkshire County without their local hospital.

Berkshire Health Systems, parent of Berkshire Medical Center in Pittsfield is in the process of buying the old North Adams Regional Hospital in Northern Berkshire's bankruptcy liquidation. Berkshire Medical Center plans to reopen the North Adams emergency room the week of May 19.



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