Hahnemann University Hospital to close

Hahnemann University Hospital will close in early September, with the wind-down of services at the 496-bed facility starting immediately, hospital officials said Wednesday.

» UPDATE: Pennsylvania on Thursday ordered Hahnemann to ‘cease and desist’ closure until there’s a plan

» UPDATE: Hahnemann University Hospital owner expected to file for bankruptcy protection Friday

Officials representing American Academic Health System LLC, which bought Hahnemann and St. Christopher’s Hospital for Children early last year for $170 million, said the closing “on or about Sept. 6” would be orderly.

If no savior emerges and potential legal challenges don’t block it, the closure will eliminate 2,500 jobs, force other city hospitals to take on more patients, especially through the emergency room, and scatter hundreds of medical students and residents who train at the Center City facility.

“Our goal in acquiring the hospitals was to help them both flourish and provide world-class care,” Joel Freedman, founder and president of American Academic, said in a news release. “We relentlessly pursued numerous strategic options to keep Hahnemann in operation, and have been uncompromising in our commitment to our staff, patients, and community. We are saddened our efforts have not been successful, and we are faced with the heartbreaking reality that Hahnemann cannot continue to lose millions of dollars each month and remain in business.”

St. Christopher’s is not closing, Freedman said.

Hahnemann, which traces its roots to a homeopathic medical college opened in 1848, has been through a tumultuous era dating to at least 1993, when Allegheny Health, Education, and Research Foundation acquired it as part of rapid expansion that led in 1998 to what was then the nation’s largest nonprofit health-care bankruptcy.

Tenet Healthcare Corp. bought Hahnemann and eight other Allegheny hospitals in the Philadelphia region but quickly scaled back, hanging on to just Hahnemann and St. Christopher’s, which were frequently the subject of sales negotiations that failed until Freedman decided to leap across the country from his Southern California base.

In an April interview, Freedman said the financial problems of Hahnemann, in particular, were much worse than he expected.

Now, city officials are trying to block his immediate escape route.

In a letter sent to Freedman on Wednesday, Mayor Jim Kenney and Philadelphia Health Commissioner Thomas Farley cited a 1969 regulation that prohibits hospitals from discontinuing emergency care without the health commissioner’s authorization.

“Dr. Farley has not consented to any reduction in emergency care by Hahnemann," the letter said. "Should AAHS discontinue emergency care or reduce its emergency care facilities without the required consent, we will ask the City Solicitor to go to court to enforce this long-standing regulation.”

The letter demanded a notice in writing by 10 a.m. Thursday “that you will not end or decrease emergency services before July 12 or without negotiating a closure plan acceptable to Dr. Farley.”

A spokesperson for American Academic said company officials “met with the city late this afternoon and will continue to do so to address all the issues raised in the city’s letter.”

Drexel University, which uses Hahnemann as the primary teaching hospital for its medical school, cited the 1969 regulation in a lawsuit Friday seeking a preliminary injunction to prevent an abrupt closure of the hospital. A Philadelphia Court of Common Pleas judge did not grant that request Tuesday.

However, the judge ordered Hahnemann officials to share their closure plan with Drexel, according to an email Drexel president John Fry sent late Tuesday to College of Medicine faculty.

The draft closure plan, according to the city’s letter to Freedman, calls for the closure of most emergency and operating room services on Monday and the end of new admissions on July 12, with most clinical operations ceasing at the end of July.

“Drexel will strenuously oppose the plan," Fry’s email said.

The Pennsylvania Association of Staff Nurses and Allied Professionals, which represents 800 registered nurses at Hahnemann, and District 1199C of the National Union of Hospital and Health Care Employees, which said it represents several hundred workers at Hahnemann, called on state and city officials to save Hahnemann.

“Hahnemann is a safety-net hospital that for decades has provided care to an under-served community,” PASNAP president Maureen May said in a statement. “We cannot allow predatory, for-profit companies to plunder such a valuable public good.”

“We are 100 percent opposed to the abrupt closure of Hahnemann University Hospital,” said Chris Woods, District 1199C’s executive vice president. “We must do everything possible to save thousands of good union jobs that provide family-sustaining wages and benefits.”

The unions, city officials, and Drexel have said the closure of Hahnemann would be devastating to health care in Philadelphia and have severe consequences for patients, but Temple University Health System said it was ready.

“Temple University Health System has been preparing for this situation since we first learned about the potential for closure, and TUHS has the capacity and the ability to treat any additional patients who come to us in the wake of today’s announcement,” Temple Health’s chief executive, Larry Kaiser, said in a statement.

For months, Freedman and his lobbyists had been warning of the potential closure and seeking financial help from government officials, commercial insurers, Drexel, and others to save the hospital, which lost money for 14 straight years under the previous owner, Tenet. Freedman said in April that Hahnemann was losing $3 million to $5 million a month.

Those efforts did not come to nothing, Gov. Tom Wolf’s office said in a statement Wednesday.

The state has allowed Hahnemann to defer nearly $20 million in state and city hospital assessments that are used to supplement Medicaid insurance for the poor at hospitals that serve large numbers of patients with Medicaid insurance, the statement said.

“In a more recent meeting, another payment model was offered along with a requirement for the hospital to undergo a performance audit, which would identify any financial concerns and ways to improve performance and make the hospital financially sustainable,” Wolf’s statement said.

“To date, Hahnemann has not responded to that offer.”