Eastern Niagara Health closing rural hospital in Newfane, N.Y.

On Aug. 29, Eastern Niagara Health System will end inpatient services at its 71-bed hospital in Newfane, N.Y., the first hospital in New York to close this year. Ten rural hospitals already have shut their doors this year, according to the National Rural Health Association.

Two-hospital Eastern Niagara, which also has a 134-bed facility nine miles away in Lockport, N.Y., said it can no longer afford to offer inpatient services at both sites given that it faces declining inpatient volume. It will continue to operate its 24-hour emergency department in Newfane as well as dialysis, laboratory, physical therapy and most radiology services.

Not-for-profit Eastern Niagara blamed a number of factors for reduced volume, including the CMS' controversial two-midnight rule that has meant more overnight observation stays at the hospital have been billed at lower Medicare outpatient rates. The growth of high-deductible insurance plans also has caused patients to delay care, system officials said.

Rural hospitals across the country have struggled to adapt to the post-healthcare reform environment. Many, for instance, lack the size and scale to participate in alternative payment and delivery models such as accountable care organizations.

The National Rural Health Resource Center last week introduced an online toolkit for critical-access hospitals on population health management to help them make the transition.

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