HCA to close Florida hospital as inpatient volumes dwindle

For-profit hospital giant HCA said Tuesday it will close one of its hospitals in Florida because of excess inpatient capacity in the region—a sign that healthcare reform continues to push patient volumes away from inpatient hospital settings and toward lower-cost outpatient facilities.

HCA will shut down Edward White Hospital in St. Petersburg, Fla., by Nov. 24. Clinical services at the hospital—which has 162 licensed beds and 110 staffed beds—will shift to three other HCA-owned hospitals in the area: Northside Hospital, Palms of Pasadena Hospital and St. Petersburg General Hospital, all of which are within about five miles of Edward White.

HCA West Florida President Peter Marmerstein estimated there are about 1,000 unoccupied licensed hospital beds in the southern part of Pinellas County, home to St. Petersburg. Less than a third of Edward White's beds are occupied on average.

“In this era where healthcare is migrating to the outpatient setting, we are seeing a significant rise in unoccupied licensed hospital beds throughout the region,” Marmerstein said in a statement, adding that the hospital's nearly 40-year-old structure also was becoming costly to maintain. “Therefore, we have made the decision that the community would benefit most if further investment is focused on consolidating Edward White's clinical services with those of our other facilities in the area.”

The decline of inpatient utilization began several years ago during the recent recession, and has intensified as the Patient Protection and Affordable Care Act encourages providers to use less-costly, preventive measures. Inpatient services are a major source of revenue for hospitals and health systems and many have been reporting relatively weak quarters due to sluggish inpatient volumes. Many of those systems and credit-rating agencies expect that trend to continue.

Fewer admissions have especially affected many not-for-profit organizations. Systems like WakeMed Health & Hospitals, Cleveland Clinic and Indiana University Health each have reported the continuation of declining inpatient volumes in their most recent quarterly statements.

A new report from consulting firm Kaufman Hall backs up those reports from health systems, finding that in the first half of this year, inpatient volumes were flat or fell for 68% of not-for-profit hospitals. Outpatient volumes, meanwhile, increased for 72% of surveyed systems. Mark Grube, a managing director at Kaufman Hall, said the results show that the acute-care system needs to focus on “value, health and outpatient/Web-based care.”

Most recent hospital closures have occurred in rural areas, as the small facilities often don't have the financial resources to survive declining inpatient loads. However, HCA's closure is not the only one of its kind.

Earlier this month, competitor LifePoint Hospitals sold River Parishes Hospital in LaPlace, La., to New Orleans-based Ochsner Health System. Ochsner said it will close the hospital Nov. 1, converting it to an outpatient facility.

HCA West Florida will not repurpose Edward White as another healthcare facility, said spokeswoman J.C. Sadler. The system intends to put the property up for sale sometime next year.

Follow Bob Herman on Twitter: @MHbherman