D.C. General’s Financial Crisis Worsens, Hospital Could Close Jan. 15
D.C. General Hospital, which treats 65,000 to 80,000 of Washington, D.C.'s uninsured residents, could close as early as Jan. 15 if city leaders and Congress do not agree soon on a restructuring plan, the Washington Post reports. City officials had presumed for months that the hospital had enough money to continue operating until March, but recent monthly losses have reached $8 million, double the amount expected. D.C.'s leaders are considering two restructuring plans -- one that would "preserve" the hospital at a cost of $231 million and another that would convert the facility into a 24-hour "community access center" at a cost of $70 million. Under the less costly plan, D.C. General would continue to serve patients who currently use the emergency room, while patients in need of hospitalization would be diverted to private hospitals at taxpayer expense. Congress this week passed the D.C. appropriations bill, which would allow the city to divert $90 million from other budget programs into Public Benefit Corp., the "quasi-independent" agency that runs the hospital, but some D.C. Council members and Mayor Anthony Williams are at odds over the restructuring plans. Williams favors the less costly plan, while nine council members, enough to override a mayoral veto, support the more expensive plan to preserve the hospital. The Post reports that Congress is "unlikely" to provide the city with any additional funds for the restructuring. In addition, the Public Benefit Corp. this year will not be allowed to borrow money from the District's general fund because it has accumulated a $109 million debt. D.C. General's reorganization could be financed through the District's $150 million reserve fund or the $62 million tobacco settlement payment the city expects this spring. That decision has yet to be made. Potential Shutdown The possible closure of D.C General has both employees and officials at area private hospitals concerned. Many administrators fear that the city will not provide reimbursement for the "sudden surge" of uninsured patients private hospitals will see. City officials are also "quietly discussing" the possibility of closing PBC down to "invalidate union contracts they deem as too expensive and too restrictive," the Post reports. The company could then be replaced by an agency without unions. Loretta Owens, president of Allied Health Employees at D.C. General, was "infuriated" by that possibility. She said, "There's no way in the world that money could be running out if they just hired a new CEO at $250,000 a year. This just blows my mind" (Goldstein, Washington Post, 11/15).This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.