Just 30 patients remain at Hahnemann University Hospital, residents tell judge
Twenty of the hospital's resident physicians -- and twice as many lawyers -- pleaded their case in court Friday.
Locked into service to a hospital with only 30 patients in its 496 beds, resident physicians at Hahnemann University Hospital told a bankruptcy judge Friday that the collapse of the institution has thrown their educations, careers, and futures into limbo.
"The Hahnemann residents are not assets, and the attempt to sell our future and training is a deplorable act,” testified Raluca McCallum, one of 20 residents in radiology who turned out for a hearing attended by nearly twice that many lawyers in U.S. Bankruptcy Court in Wilmington.
U.S. Bankruptcy Judge Kevin Gross granted a request by Mark Minuti, a lawyer for Hahnemann’s main creditors, to allow the hospital to release half of its 589 residents from any ties next Friday and the rest on Aug. 9. That permission allows residents to move into new posts.
The hospital has announced that it will close Sept. 6, though numerous services already have stopped. Another resident, Judy Owens, told the court Friday that only 30 patients remained in beds at Hahnemann.
The resident physicians’ hunt for new long-term positions — depending on the specialty, a residency can run upward of six years — is complex. Hospitals that might hire them want to know details about their package of federal educational subsidies, provided to defray the cost of training residents. The federal government now pays an average of more than $100,000 per year per resident to provide that assistance in Pennsylvania, studies show.
Hahnemann residents say the hospital has been slow to release them and to provide them with crucial information about the subsidies. Minuti said the hospital needed time to compute the precise subsidies attached to each resident. In almost all cases, the subsidies are the sweeteners that cause hospitals to hire residents, testimony made clear Friday.
Minuti also said Hahnemann needed to hold some residents to serve current patients and people seeking emergency care.
Tower Health, a chain of six Pennsylvania hospitals, has agreed to bid at least $7.5 million to acquire Hahnemann’s residency and fellowship slots, establishing a floor for an auction to be held Aug. 7.
Residents would be guaranteed a spot at one of Tower’s six hospitals, the largest of which is the 716-bed Reading Hospital in Berks County. The system’s only Philadelphia property is the 148-bed Chestnut Hill Hospital.
But that’s not an attractive offer to many residents, who have been scrambling to get into other programs. One major issue is that the Tower system has accredited residency programs in only five of the 15 medical specialties available at Hahnemann. Radiology is not one of the five. So far, witnesses said Friday, only 12 residents have nailed down new positions.
In addition to the auction of the residency slots, an auction is to be held Sept. 19 for St. Christopher’s Hospital for Children, which was put on the block as part of the same bankruptcy as Hahnemann. Four Philadelphia health institutions — Einstein Healthcare Network, Jefferson Health, Philadelphia College of Osteopathic Medicine, and Temple Health —- have formed a consortium to bid for the children’s facility. No purchase figure has been made public.
Following decades of turbulence under multiple owners, Hahnemann faces extinction after chief executive Joel Freedman announced plans to close the 171-year-old institution.
Freedman, a specialist in turning around troubled hospitals, bought Hahnemann last year, along with the more financially healthy St. Christopher’s. He filed for bankruptcy on the last weekend of June. He said Hahnemann was losing up to $5 million a month and couldn’t continue to operate in the red.
Though experts agree that Philadelphia has a surplus of hospital beds, closure will eliminate 2,500 jobs and force its thousands of patients to seek care at other emergency rooms. Hahnemann’s ER is the first choice for many residents of low-income North Philadelphia communities south of Girard Avenue.
Freedman paid a total of $170 million in 2018 for St. Christopher’s and Hahnemann.
Hahnemann, founded as a medical college in 1848, was named for Samuel Hahnemann, a German doctor who died in 1843 and is credited with founding homeopathic medicine, now viewed as without scientific merit. The hospital turned away from homeopathy in the mid-20th century.
Allegheny Health, Education, & Research Foundation acquired Hahnemann in 1993 as part of a rapid expansion that led in just five years to what was then the nation’s largest nonprofit health-care bankruptcy. In 1998, Tenet Healthcare Corp. bought Hahnemann and eight other Allegheny hospitals in the Philadelphia region but quickly scaled back, hanging onto just Hahnemann and St. Christopher’s until the sale to Freedman’s operation.
With 36 percent of its revenue last year coming from Medicare and 29 percent from Medicaid, Hahnemann was unusually dependent on government insurance programs among Philadelphia hospitals, according to the latest figures from the Pennsylvania Health Care Cost Containment Council. Reimbursements from these programs are markedly lower than what private insurers pay.
After Friday’s hearings, the residents who attended, some wearing white medical coats, said they were pleased that firm dates had been set for their release.