Community Hospital Closure Clarified

By: 
Mike Vasilomanolakis, M.D.

Dr. Mike Vasilomanolakis

Community Hospital of Long Beach first opened in 1924 and has been there through depression and wars. As of Jan. 1, 2022 it is closed. I would like to summarize what happened.

In 2018 the hospital and land, which is owned by the city of Long Beach, was under the management of Long Beach Memorial Medical Center. Because of earthquake retrofit demands by the state MemorialCare closed the hospital due to the pending enormous cost of retrofitting.

At that time a trio of interested parties formed the MWN network to reopen the hospital. This included John Molina, Dr. Wu and a patient IPA network. Soon after they won the contract to bring back the hospital Dr. Wu and the Network bowed out leaving just John Molina to proceed.

It took roughly three years to reopen the hospital which was expedited under emergency circumstances dealing with the COVID-19 surge.

After it opened Community Hospital had a difficult time as it did not have all the equipment it needed and staffing by physicians and nurses was challenging. What hurt the most was that there were no electronic medical records (EMR), only antiquated paper charts which made everyone’s job more difficult. The hospital was able to function, but it needed the EMR to function more efficiently.

As a “new” hospital without long-term staff it needed to recruit nurses in the middle of a pandemic where nurses were hard to find. It had to rely to a large degree on registries to supply nurses. A nurse typically makes $60-70 per hour plus extra for COVID pay. However, registries were charging $200-300 per hour for nursing staff. The labor costs were tremendous and there was no way to break even financially.

Furthermore, there was the looming $75 million earthquake retrofitting cost that had to be completed by 2025. Combining the enormous labor costs with reported losses of $30 million plus the retrofitting demand was too much and Mr. Molina gave 90-day notice to close the hospital. However, the state (California Department of Public Health) was concerned that Community Hospital was understaffed due to its need for registry personnel. As such they bypassed the state mandated 90-day notice and closed the hospital in less than 30 days to everyone’s surprise.

At this point the question becomes what will happen to the hospital. Remember the city owns the land and the buildings however it remains under Mr. Molina’s management. He is reportedly $30 million in the negative and in his contract the city is to pay him his losses if he decides to pull out. This is not a scenario the city anticipated.

Mr. Molina has expressed an interest in making the center a psychiatric hospital with an urgent care and wellness center. The center would be open to all and would even have a longevity section. Please note that a psychiatric hospital does not require retrofitting because people are ambulatory and can escape if there is an earthquake.

In the charter of the hospital property it stipulates that an acute care hospital has to be on this land. In order to make it a psychiatric hospital plus other outpatient programs the City Council will need to change the charter ridding the acute care hospital stipulation and selling the assets to Mr. Molina. Reportedly there will be an open session to the public in February to voice their opinion to the City Council and thereafter a vote will take place.

This is a significant issue. It costs $2 million per bed to build a new hospital. Community is a 150-bed hospital and to build it new would cost $300 million. Furthermore, one would have to find land to build it which is difficult to find. Once you change the City Charter and no longer require an acute care hospital you have condemned east and central Long Beach from ever having a hospital and emergency room. This pandemic should have taught us how critically important these facilities are. These emergency crises will happen again and again in different forms. Pandemics, natural disasters and other man-made disasters, etc.

On a personal level many of us made a great effort to bring back this hospital and even greater one to provide quality care and help make the hospital more efficient and effective. We were starting to get busier and if it wasn’t for the lack of electronic medical records and the high registry costs we would have succeeded.

Making hospitals earthquake safe was mandated by the state of California approximately 20 years ago. Due to the inability of hospitals to fund these demands, every five years the deadline gets delayed another five years. Given this pandemic with the enormous hospital financial losses this will likely be delayed at least another five years.

The state needs to realize that hospitals just don’t have the money to perform this expensive retrofitting. With new hospital construction costs of $2 million per bed they can’t afford to build new hospitals. Many hospitals will close because of this mandate. The absence of a hospital and emergency room will devastate and do more harm to more people than waiting centuries for a possible earthquake that will hit that particular hospital. Furthermore, in an earthquake you are going to want an emergency room even more than ever and will especially wish you had never closed down that hospital.

The state needs to STOP demanding that this be done. Hospitals will never generate the amount of income to ever pay it off. Most hospitals lose money. If the state mandates retrofitting, then they need to supply the funding for it.

We need to get the state to stop making impractical demands.

I don’t know what the answer is but I would suggest that whatever deal is made with the operator of the lease at Community Hospital it should stipulate that if circumstances change and there is a delay of at least five years in implementing earthquake retrofitting that any reasonable and viable offer to restart an acute care hospital and ER take precedence
 

E. Mike Vasilomanolakis, M.D. FACC, FACP, is a cardiologist and former chief of staff at Community Hospital of Long Beach.

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