Name of Facility: Jersey City Medical Center CN# FR Name of Applicant: LibertyHealth System Total Project Cost: 0

Transcription

1 CERTIFICATE OF NEED Department Staff Project Summary, Analysis & Recommendations Closure of Pediatric Intensive Care Unit and Removal of the Children s Hospital Designation at Name of Facility: CN# FR Name of Applicant: LibertyHealth System Total Project Cost: 0 Location: Jersey City Equity Contribution: 0 Service Area: Hudson Project Description (by Applicant): LibertyHealth System (LHS) seeks a certificate of need approval for Jersey City Medical Center (JCMC) to: Close its six bed Pediatric Intensive Care Unit (PICU). Remove JCMC s Children s Hospital Designation. Reduce the number of pediatric beds. JCMC is a 21 bed licensed general acute care hospital whose bed composition consists of 153 medical/surgical, 2 OB/GYN, 2 Pediatric, 34 Adult ICU/CCU, Pediatric ICU, 1 Adult Acute Psychiatric, and 20 Adult Closed Acute Psychiatric beds. JCMC is licensed for 21 Intensive and 5 intermediate bassinets and is designated as a Regional Perinatal Center. The hospital s licensed service complement is comprised of inpatient operating rooms, 2 Cardiac Surgery rooms, 2 Cardiac Catheterization Laboratories, 1 Magnetic Resonance Imaging unit, 1 fixed and one mobile Computerized Tomography scanner and 3 hospital-based off site ambulatory care facilities. The Applicant also is a designated as a Level II Trauma Center and a Children s Hospital. The removal of the Children s Hospital Designation accounts for the hospital s reassessment of inpatient pediatric services. The Applicant has disclosed plans to reduce its pediatric inventory from a 2 bed unit to a 10 bed unit composed of the PICU beds and 4 of the 2 currently licensed pediatric beds. The remaining 22 pediatric beds will be converted to medical-surgical beds, increasing the overall number of medical/surgical beds by 22 beds for a total of 175 beds. The applicant indicates that their action to close the PICU and remove its Children s Designation would lessen the financial burden on the hospital and LibertyHealth System as a whole.

2 Page 2 The applicant also believes that sufficient pediatric intensive care beds are available at the other neighboring hospitals in the surrounding counties to ensure that the existing level of pediatric intensive care is maintained for Hudson County residents. Justification of Need by the Applicant: The project proposed by the applicant would close the six bed Pediatric Intensive Care Unit (PICU) and remove the Children s Hospital Designation at JCMC. The Applicant states that JCMC has suffered operating losses. In 200, the hospital s pediatric service experienced a $.7million loss, of which $3 million relates to the PICU. According to the Applicant, there are a number of issues that have impacted their decision to close these services as indicated below: Declining patient length of stay at the PICU at JCMC in comparison to the neighboring Regional Children s Hospitals. Declining PICU volume as the outmigration patterns show a higher number of patients seeking their PICU care in counties outside of Hudson County and in New York. Discontinuance of the pediatric residency program was effective July 2007 due to the lack of support by the expected board certified pediatric sub-specialists. The bed PICU had inadequate volume to develop cost-effective expertise in the delivery of PICU care. Pre-existing referral patterns link upper Hudson County to Bergen and Passaic Counties, and lower Hudson County to Essex County. Travel times, distances, and the nature of pediatric intensive care make the regionalization of PICU care for Hudson County children practical and possible. The availability of a depth and breath of pediatric sub-specialists (e.g. pediatric surgeons, orthopedists, cardiologists, neurosurgeons, gastroenterologists, oncologists and hematologists) at Newark Beth Israel and other neighboring Children s Hospitals makes regionalization of PICU services a strong solution for Hudson County children. Facilitated transport, a well-defined EMS system in Hudson County and helicopter availability door to door make even urgent pediatric transfers smooth, fast and uneventful. 2

3 Page 3 The closure of the PICU creates an opportunity to prioritize the Medical Center s Perinatal (OB, Newborn and NICU) services and increase it s investment in these services. As the only Regional Perinatal Center in the County, JCMC is the only facility with a full complement of services. According to the applicant, JCMC is entering into an affiliation agreement with Newark Beth Israel Medical Center (NBI). Part of the agreement provides that NBI will accept pediatric transfers to their PICU without objection. The Applicant states that NBI and three other PICU hospitals are located within 1 miles of the farthest point in Hudson County. NBI is an average travel time of 21 minutes from Hudson County hospitals by EMS transport and minutes by car depending on time of day. The other three hospitals are identified as the University of Medicine and Dentistry of New Jersey, noted to be an EMS travel time of 20 minutes or 23 minutes by car from JCMC; St. Josephs Medical Center with an average EMS travel time of 23 minutes or 24 minutes by car from Hudson County hospitals; and Hackensack University Medical Center which is an average of 1 minutes travel time from other Hudson County hospitals by EMS transport and 20 minutes by car. EMS travel times are actual documented transit times at various intervals of the day (8am, 12pm, 5pm and 7pm) while car travel times are based on Google, which doesn t consider the impact of traffic patterns at various times of the day. See Tab I, Travel Times, April 30, 2008 responses to completeness questions. The applicant states that the essence of the application is a regional approach to PICU care, building on out-migration patterns for this care that are already well established in Hudson County. According to the applicant two options were pursued as an alternative to closing their PICU. The first was to offer the PICU beds to NBI in the hope they might consider an outsourced service. The NBI physician staff determined that such an arrangement did not make sound fiscal sense. The second option was to give the PICU beds to NBI. This was also considered unworkable by NBI for fiscal reasons because NBI already had some excess capacity, and because market share data shows that out-migration patterns already exist. The six PICU beds were also offered to Christ Hospital. Their response was very similar to NBI s. 3

4 Page 4 Applicant s Statement of Compliance with Statutory and Regulatory Requirements: The applicant has stated the following to demonstrate its compliance with the statutory criteria contained in the Health Care Facilities Planning Act, as amended at, N.J.S.A 2:2H-1 et seq. and N.J.A.C 8: et seq. as follows: 1) the availability of facilities or services which may serve as alternatives or substitutes: According to the Applicant: There are four hospitals with Pediatric Intensive Care Unit beds located within 1 miles (at the farthest point) of Hudson County. These include the Newark Beth Israel, UMDNJ, St. Joseph s Regional Medical Center and Hackensack University Medical Center. These hospitals have a long and fine history of providing Pediatric Intensive Care to the residents of Hudson County (in 2004 and 2005, 75.7% of Hudson County residents chose providers outside of Hudson County for PICU care). Although there is a difference between use of PICU for intensive rather than emergent care, travel distances and travel times in this urban area are not unreasonable. Travel times for emergent pediatric care are enhanced through the use of the EMS system and helicopter transport. Access to these PICUs via or other local hospitals is facilitated through transfer agreements. In the case of an affiliation agreement for the Regional Perinatal Center makes the NBI Maternal- Child transport even smoother. Finally, a letter of support from Newark Beth Israel and a transfer agreement demonstrate their willingness to accept PICU patients from Hudson County and from the. 2) the need for special equipment and services in the area: According to the Applicant: Redundancy and duplication of expensive equipment have contributed significantly to the cost of care across the country and certainly in Hudson County. Specialized equipment targeted at the pediatric population whether we consider specialized endoscopic equipment for children, OR equipment for the pediatric cardiac patients, stents or pediatric orthopedic nuts, bolts and screws are all expensive. Technology in this arena is fast-growing and becomes obsolete in months. The Applicant believes that it is counterproductive and extremely expensive to continue duplicating these specialized pediatric services and equipment when there are other licensed providers available within a 1 mile radius to serve this relatively small population. 4

5 Page 5 The applicant refers to Dr. John Wennberg s landmark study published in 200, on the utilization of health care resources in various areas of the country. His findings demonstrate that significant high utilization of health care resources occurs not because patients are more acutely ill in certain areas of the country, but because of availability of resources - when more physicians and services of a certain type were available and concentrated in a given geographic area, they were more heavily used. In fact, they were overused. Although Wennberg s study does not address the pediatric population specifically in this regard, his study also points up certain geographic referral phenomena. For example, in his analysis (which was also cited in the Governor s commission interim report on rationalization in NJ hospitals2), (NOTE: The full title of the Commission is The New Jersey Commission on Rationalizing Health Care Resources) Wennberg clusters the in a Newark based group. This effectively demonstrates the linkage between lower Hudson County and Essex County. At the other end of Hudson County, Meadowlands Hospital Medical Center (MHMC), is specifically linked with Bergen County and the Hackensack group even though physically located in Hudson County and although the MHMC serves many patients from Bayonne and lower Hudson. These referral patterns cited in Wennberg are supportive of the regionalization concept as it applies to PICU care. Wennberg, J. (200) The Dartmouth Atlas Study ) the adequacy of financial resources and sources of present and future revenues: According to the Applicant: By closing the PICU service and removing the Children s Hospital designation, the LibertyHealth system (sic) will reduce the operating deficit by approximately $3 million annually. The general pediatric service will continue in reduced form at JCMC, and at MHMC. This cost reduction will serve to strengthen the remaining program and services offered at JCMC and MHMC. 4) the availability of sufficient manpower in the several professional disciplines: According to the Applicant: There is sufficient manpower in the LibertyHealth System to accomplish this closure. 5

6 Page 5) will not have an adverse economic or financial impact on the delivery of health care services in the region or statewide and will contribute to the orderly development of adequate and effective health care services: According to the Applicant: The inpatient PICU market share from 2004 and 2005 (when the JCMC PICU was in full operation) shows 77.5% total out-migration of children residing in Hudson County, 35.8% to Essex County, 14.4% to New York, 9.3%, to Passaic County, 10.4% to Bergen County, and 7.% to other sites. In fact, only about one-fifth of the Hudson County children requiring PICU care stayed in Jersey City. Due to the clinical and reputational strength of a number of nearby PICU service providers that serve Hudson County patients, Hudson County residents and physicians have already shown a preference or need for PICU care out of county. Without the six JCMC PICU beds, the Essex/Hudson region still has 40 PICU beds (NBI and UMDNJ) to serve the pediatric population of 351,000 (11.39 per 10,000 children), without consideration of Bergen and Passaic PICU capacity. JCMC is entering into an affiliation agreement with the Newark Beth Israel Medical Center (NBI) to provide clinical augmentation and program leadership enhancement to our perinatal and neonatal services. As part of this agreement, NBI has accepted pediatric transfers to their PICU. With 29 PICU beds, NBI is well attuned to managing pediatric intensive care. Facilitated transport, a well defined EMS system in Hudson County and helicopter availability make even urgent pediatric transfers smooth, fast and uneventful. The applicant does not anticipate any problems resulting from the closure of these services nor the elimination of its designation given the more then adequate regional resources. Public Hearing: One public hearing on this application was held at Jersey City University located in Jersey City, on August 5, No members of the public attended and no testimony either verbal or in written comments was presented. Department Staff Analysis: Department staff concluded that the applicant has adequately documented compliance with the applicable certificate of need rules (N.J.A.C. 8: et seq.) and general statutory standards at N.J.S.A. 2:2H-1 et seq.

7 Page 7 Department staff reviewed the applicant s certificate of need and determined that the Applicant s rationale to discontinue PICU services and reduce pediatric beds at JCMC is a realistic assessment of the health care services environment for both Hudson County and the region. Considering PICU services are highly specialized critical care that require the same in staffing, the maintenance of such a unit is expensive. Cost, the lack of volume and the number of providers duplicating the service in relatively close proximity to JCMC account for their decision to cease operation of this service. For JCMC to continue its pediatric residency program and designation as a Children s Hospital would have exerted significant financial pressure on LibertyHealth System possibly leading to the closure of more services. In 2005, the occupancy rate for the six PICU beds at JCMC was 44.1% with an ADC of 2.7. The occupancy rate marginally increased to 48.8 % with slightly higher ADC at 2.9 in 200. However, the occupancy rate for first six months of 2007 prior to the discontinuation of their PICU at the end of July showed a dramatic decline to 19.2% with an ADC of 1.2. The utilization trend at JCMC shows that these beds never reached 50% occupancy while fully operational. The data for NBI, the closest provider of PICU services at 12.3 miles increased their beds from 19 in 2005 at occupancy rate of 52.8%, to 29 at an occupancy rate of 3.% in 2008, which demonstrates that a relatively small number of beds were used during this reporting period. UMDJ, also within a 13 mile radius, increased their bed capacity from 2 in 2005 to 11 in The 2005 data is not useful for comparison purposes as the ADC indicates that more than 2 beds were used for PICU patients. Therefore a more reliable comparison is 200 or 2007 to The occupancy rate for 200 was 90% with an ADC of 5.9 with 7 licensed beds. In 2007 the licensed beds increased to 11 at which it remains today. The 2007 occupancy rate was 47.3% with an ADC of 5.2. The occupancy rate and ADC for UMDNJ s PICU has remained relatively consistent from 2007 through Quarter 1 in The other three PICU providers in 2008 had higher occupancy rates while operating with the same number of beds as in 2005, St. Barnabas - 10 beds with a 41% occupancy rate, St. Joseph s Healthcare System - 10 beds with a 94% occupancy rate and Hackensack University Medical Center - 10 beds with a 59% occupancy rate. The first half of 2009 shows very little change in occupancy rates for these PICU providers except NBI which dropped from 3. % to 21.5%. Please refer to Appendix A. When considering the five hospitals with PICU beds in Essex, Bergen and Passaic Counties as a whole, there are 71 licensed PICU beds in the area with an ADC of 34.3 and an occupancy rate of 48.3%. These figures indicate sufficient bed capacity exists in the region to serve the pediatric patients in need of PICU services who originate in Hudson County without existing providers having to increase their operating capacities. A major factor contributing to the underutilization of the PICU beds at JCMC was the out-migration of pediatric patients in Hudson County. The Applicant presented data showing the development of out-migration patterns long before JCMC actually closed its PICU in July of In 2004, 133 PICU patients (19%) who were Hudson County 7

8 Page 8 residents out-migrated to Bergen and Passaic County hospitals, 11 PICU patients (17%) who were Hudson County residents out-migrated to Essex hospitals, and 5 PICU patients (13%) who were Hudson County residents out migrated to other New Jersey Counties and New York. The percentages were similar in 2005 with 154 PICU patients (17%) who were Hudson County residents out-migrating to Bergen/Passaic, 120 PICU patients (1%) who were Hudson County residents out-migrating to Essex County and 57 PICU patients (%) who were Hudson County residents out-migrated to New York Hospitals. Another 2 PICU patients ( %) who were Hudson residents outmigrated to hospitals in other New Jersey counties. JCMC retained only half (3 or 51% in 2004 and 497 or 53 % in 2005) of the PICU patients originating in Hudson County. Please refer to chart on third page of Applicant s February, responses to completeness questions. Out-migration for Hudson residents continued to climb upward in 200 as well as The data illustrates that 193 PICU patients (22%) out-migrated to Bergen/Passaic hospitals in 200 and 245 PICU patients (3%) in The data also disclosed that 153 PICU patients (17%) out-migrated to Essex in 200 and 237 PICU patients (34%). However, there was a fall in out-migration to other New Jersey counties of Hudson County residents from 7 PICU patients (8%) to 45 PICU patients (7%). Information was not available for New York hospitals after Please refer to chart in Applicant s February 2009 responses to completeness questions. The applicant s data suggests that the community had adjusted to using other facilities after JCMC ceased operating their PICU in July 2007 without encountering any significant access problems. For instance, NBI experienced an increase of PICU patients from 4 (5%) in 200 to 120 (17%) in 2007 and 110 (14%) in According to the Applicant, from January 1 through November 2008, 413 (53%) Hudson County PICU patients were admitted to PICU s in Bergen and Passaic County, 284 (37%) were admitted to hospitals in Essex County and 2 (8%) PICU patients were admitted to other unidentified counties in New Jersey. Data for New York hospitals was not available The Applicant also reported that after the closure of their PICU, from July 1, 2007 to December 1, 2008, 180 PICU patients were transferred from JCMC. Newark Beth Israel absorbed the most patients -12, 37 were transferred to UMDNJ, and the remainder was divided among St. Barnabas as well as the other regional providers. With respect to the removal of the Children s Hospital Designation, JCMC decided to reduce their number of licensed pediatric beds from 2 to 10. While CN approval is not required for these types of bed reduction, DHSS felt compelled to review the remaining pediatric bed capacity for the greater Hudson County Region and assess whether the existing inpatient pediatric services would satisfy demand. JCMC s decision to reduce its pediatric beds is based on its continual decline in occupancy rates from a high of 4.3% in 200 to a low of.3% in The Applicant also stated that one of the reasons for terminating the PICU service was its inability to attract board certified pediatric sub-specialists. This lack of 8

9 Page 9 sub-specialists would also reduce the quality of care that JCMC would be able to provide to its general pediatric population. In fact, a memo on the policy for admission of patients states, All general pediatric patients who require admission, but do not require critical care or specialty care may be admitted to the inpatient pediatric unit. (Please see responses to completeness questions April 30, 2008 and August 1, 2008, Tab A, 3 rd page). After JCMC terminated its pediatric residency program, the ADC for its 2 beds in 2008 dropped to 1.. In 2008, with the exception of the 34 pediatric beds at Hackensack University Medical Center, which had an occupancy rate of over 100 %, all of the other providers were less than 0%. The hospital closest to JCMC, Christ Hospital at 1. miles, has had the lowest occupancy rate of these area hospitals at 2% for its six beds. Excluding both JCMC and HUMC pediatric beds from the region, there are 280 beds available for pediatric patients, all within a twenty mile radius. In the first quarter of 2009, JCMC s occupancy rate increased to 1.9% but this low rate is not a reliable predictor for a full year as to whether there will be further increases or a decline during the year. Based on this data, there appears to more than an adequate supply of general pediatric beds in the region. Please refer to Appendices B and C. Staff believes that the Applicant s decision to close Jersey City s PICU service is sound and in the best interests of the area s health care delivery system. The closure of these PICU beds and removal of the Children s Specialized Hospital designation would not adversely affect access to PICU care in the region. Even with the downsizing of services at JCMC, an adequate number of PICU and inpatient pediatric providers remain to easily absorb the pediatric patients once treated at JCMC. Staff is convinced that the health status of pediatric patients in Hudson County would not be compromised based on the availability of the other providers within the region. In addition, staff believes that in such a specialized area as PICU, more volume at a centralized regional location would result in the development and application of greater clinical skills, a higher quality of care and improved patient outcomes. Staff found the steps taken by JCMC to prevent any negative or unforeseen consequences related to the PICU closure and removal of the Children s Hospital Designation to be effective. The formation of a Pediatric Community Advisory Group (Please see April 30, 2008 responses to completeness questions page 5 and Tab D.) for ensuring continuity and access to PICU services resulted in transfer agreements with NBI, UMDNJ and St Barnabas Hospitals and the media awareness campaign to advise health professionals in the local community and adjacent counties of their plans to discontinue PICU services allowed other PICU providers to adjust their services as needed. It is evident from the data that continuing the PICU and the Children s Hospital Designation at JCMC at such low volumes would only further detract from the financial viability of LibertyHealth System. Staff agrees that it would be difficult to attract and retain the appropriate sub-specialty staff without a PICU and a children s hospital designation. This data supports JCMC s position that ceasing these inpatient services would strengthen their hospital system without adversely impacting the regional health system. Department staff 9

10 Page 10 also found that since these services have been discontinued at JCMC in July 2007, the regional health care delivery system has not been disrupted nor has there been any reported problems in accessing care at these regional hospitals. The approval of this application would continue to direct more patients to existing PICU providers strengthening their overall services. Department staff is confident that the closure of the PICU and reduction of pediatric beds will not negatively impact on delivery of health care for this region. Also, the fact that no members of the public attended the public hearing indicates that there is no significant quality of care or access issues affecting Hudson County residents and confirms the availability of PICU services in the region. Staff Recommendations: Based on this documentation of compliance with regulatory and statutory criteria, Department staff recommends approving the closure of the PICU for the following reasons and with the conditions noted below: Reasons: 1. Financial conditions preclude the continued operation of the PICU and Children s Hospital, and also place the future viability of LibertyHealth System at risk. 2. Since 2005, JCMC has had low and declining ADC and occupancy in their PICU, as well as in general pediatric beds. 3. Surrounding hospitals have sufficient inpatient PICU and pediatric capacity to accommodate the patient census from the closure of the PICU and reduction of pediatric beds at JCMC. Conditions: Based on this documentation of compliance with regulatory and statutory criteria, Department staff recommends approving the closure of JCMC s PICU service and removal of its Children s Hospital designation with the following conditions: 1. The applicant shall file an application with the Department s Certificate of Need and Healthcare Facility Licensure Program to amend JCMC s license to remove the PICU beds and the Children s Hospital designation, as well as to reduce the pediatric licensed beds to 10 and increase the medical/surgical licensed beds to 175 for the existing location. 10

11 Page The applicant shall notify the Department s CNHCFL in writing, specifically who is responsible for the safekeeping and accessibility of all JCMC PICU and pediatric patients medical records (both active and stored) in accordance with N.J.S.A. 8:2:8.5 et. seq. and N.J.A.C. 8:43G Within 3 months of approval of the Certificate of Need, the Applicant, after performing a transportation needs assessment, shall develop and implement a transportation plan to transport children to other inpatient PICU providers at no cost to the patient and enable family members to visit children who have been transferred to other hospitals for PICU services. This plan should be based on an assessment of transportation needs and reviewed and implemented in consultation with the Pediatric Community Action Group. This planning group shall consult with the appropriate county transportation authorities in the surrounding counties where the PICU providers are located. These transportation services for Hudson county residents shall be provided at no cost to the family members. The plan shall be submitted to the Department for review and approval. The plan shall remain in effect for 5 years after licensure. Any changes in this plan require Department approval and shall require 120-day prior notice. A self-evaluation of the implementation of the plan shall also be conducted on a yearly basis, commencing on the date of approval of the application, for 5 years after implementation to measure effectiveness of this initiative and be submitted to the Department for review and comment. 4. The applicant shall continue the current Pediatric Community Advisory Group for at least three years after the closure of the PICU in order to monitor access to PICU care, as well as health outcomes for Hudson County PICU patients. 11

12 Page 12 Appendix A PICU Data - Area Hospitals Provider/Location Jersey City Medical Center 355 Grand St. Jersey City, NJ Distance from JCMC (miles) 1 Occupancy Rate (%) % % % ADC Licensed Beds 0 0 Newark Beth Israel 201 Lyons Ave. Newark, NJ UMDNJ The University Hospital 150 Bergen Street Newark, NJ St. Barnabas 95 Old Short Hills Road West Orange, NJ St. Joseph's Healthcare System 703 Main Street, Paterson, NJ HUMC 30 Prospect Avenue Hackensack, NJ % % % % 2009 Q1-21.5% % % % % 2009 Q1-44.3% % % % 2009 Q1-40.3% % % % % 2009 Q1-91.0% % % % % 2009 Q1-59.0% Source: MapQuest 2 The 2005 data is not useful for comparison purposes as the ADC indicates that approximately seven, rather than two beds, were utilized for PICU patients. 12

13 Page 13 APPENDIX B General Pediatric Data JCMC NBI UMDNJ HUMC St Jo Pat St. B Christ Palisades Meadow lands LicBed Hoboken 2005 OccRate 58.7% 2.% 44.1% 75.1% 50.3% 2.0% 18.3% 3.2% 27.5% 21.7% ADC LicBed OccRate 4.3% ADC LicBed OccRate 24.0% ADC LicBed OccRate.3% ADC LicBed Q1 OccRate 1.9% ADC

14 Page 14 APPENDIX C Distance from JCMC to Area Hospitals with Pediatric Units Provider/Location Newark Beth Israel 201 Lyons Ave. Newark, NJ UMDNJ The University Hospital 150 Bergen Street Newark, NJ HUMC 30 Prospect Avenue Hackensack, NJ 0701 St. Joseph's Healthcare System 703 Main Street, Paterson, NJ St. Barnabas 95 Old Short Hills Road West Orange, NJ Christ Hospital 17 Palisade Ave. Jersey City, NJ 0703 Palisades Medical Center 700 River Road North Bergen, NJ Meadowlands Hospital 55 Meadowlands Parkway Secaucus, NJ 0709 Hoboken University Medical Center 308 Willow Ave. Hoboken, NJ Distance from JCMC (miles) Travel times from JCMC minutes minutes minutes minutes minutes 1. minutes minutes minutes 2. 9 minutes Source: MapQuest 14