For one, Eastern Niagara Hospital closed in mid-June, ending its 115-year run in Lockport after several years of financial instability. 

Then, on the other side of Niagara County, Catholic Health announced a plan to convert Mount St. Mary’s Hospital in Lewiston into a neighborhood hospital – the same model guiding the Buffalo health system’s construction of Lockport Memorial Hospital.

And in Warsaw, the Wyoming County-owned health system – just weeks after ending baby deliveries at its hospital – filed plans to cut more than 40% of its inpatient beds to ensure long-term viability.

“The pandemic made things worse, but a lot of these trends have been going on for decades,” said Larry Zielinski, a health care administration expert at University at Buffalo.

Covid-19 accelerated the movement toward outpatient settings, with more patients receiving care outside of hospitals. That has hit the smaller hospitals even harder, Zielinski explained, because they’re often caring for the less-intensive patients who also could be served in ambulatory centers. On top of that, the community hospitals – especially those in rural settings – often struggle to have enough volume coming through the door to sustain certain services and retain specialists.

That’s not to say the big systems aren’t struggling, too. Operating losses last year totaled about $175 million at Catholic Health and nearly $81 million at Kaleida Health. Nationally, Zielinski noted that respected industry leader Geisinger, a 10-hospital system in Pennsylvania, had a $239 million operating loss last year and, not long after, announced it would be acquired by the much-larger Kaiser Permanente. 

“I’m sitting here thinking, ‘Man, if Geisinger can’t make it work, what hope do the rest of us have?’ ” Zielinski said.

It all makes for a hospital system in flux, with health systems adjusting to post-pandemic realities. And changes are shaking out first at community and rural hospitals.

“We’re never going back to the pre-pandemic days,” said C.J. Urlaub, president of Mount St. Mary’s and Catholic Health’s senior vice president for strategic partnerships, integration and care delivery in Niagara County. “Society has changed, health care has changed, the financial supports have changed. The staffing has changed. And you just can’t go back to the old days, I think. Was this probably going to happen? Yeah, but it’s accelerated.”

‘The future’ model

As the pandemic progressed and Urlaub observed more patients opting for care in ambulatory settings rather than hospitals, he and Catholic Health leaders recognized that maintaining a full set of services in an outlying community such as Lewiston would be a challenge in the future.

It was the same conclusion Catholic Health reached in Lockport.

There, Eastern Niagara Hospital filed for bankruptcy in 2019, after years of trying to maintain full services with low patient volume. So when Catholic Health announced plans to build Lockport Memorial Hospital, it knew it needed a right-sized, sustainable neighborhood hospital that was different than the old hospital model.

“We knew that was going to be the future,” Urlaub said. “We said, ‘Well, you know, why do it just in Lockport? Does it have an applicability in Lewiston?’ “

That thinking led Catholic Health to recently announce it was reconfiguring Mount St. Mary’s and turning it into a neighborhood hospital. That meant reducing the hospital’s inpatient medical beds and transitioning surgery, maternity, dialysis and gastrointestinal services to other Catholic Health hospitals that specialize in those particular areas. The move also affected about 100 Mount St. Mary’s employees, “the great majority” of whom found new roles within Catholic Health, Urlaub said.

On July 1, Mount St. Mary’s began transitioning its labor-and-delivery services to Sisters of Charity Hospital in Buffalo. While Mount St. Mary’s will no longer handle deliveries – Urlaub said the hospital was delivering around three babies a week – the Lewiston facility will still offer outpatient OB/GYN services, including wellness visits and pre- and postnatal care.

Urlaub said the other services being transitioned away from Lewiston also weren’t high volume, with roughly two dialysis patients a day and generally two patients in the hospital at any given time for inpatient surgery.

He estimated that at least 90% of patients who arrive in the Lockport or Lewiston neighborhood hospitals will be able to get care on-site with the services available, while the remainder may need to be transferred to another hospital in Catholic Health’s footprint for a higher, more specialized service.

“It’ll take time for the community to understand it and accept it,” he said. “But I really believe that is the future for these communities that are more rural.”

Struggling, but ready to help

Once Mount St. Mary’s reconfiguration is complete, Niagara Falls Memorial Medical Center will be the only full-service hospital in Niagara County.

And longtime President and CEO Joseph A. Ruffolo has no plans to scale back services.

“We need to be very well prepared, but I could not imagine a full-service health system not in existence to serve 200,000 people,” said the 67-year-old Ruffolo, born and raised in Niagara County.

With the changes at Mount St. Mary’s, Ruffolo believes Niagara Falls Memorial will see additional volume and plans to “staff up,” hoping to hire more permanent employees to replace more costly travel workers. 

On the other side of Niagara County, following the closure of Eastern Niagara and ahead of Lockport Memorial’s opening in September, Orleans Community Health’s Medina Memorial Hospital has already seen an increase in patients coming from Niagara County, CEO Marc Shurtz said.

The independent health system, which has an affiliation with Rochester Regional Health for certain contracted services, is reviewing staffing in several departments and assessing workflows at the hospital to adjust for the influx.

“We’re still here as an independent,” said Shurtz, a Lockport resident. “And it’s been a very challenging probably decade. But honestly, we’re kind of positioned now, with the pandemic over, for growth. And we’ve been seeing that.”

Financial hurdles remain, Shurtz said, but Orleans Community Health has expanded its general surgery, primary care and cardiology services in recent years.

Niagara Falls Memorial has similar challenges, especially in recruiting for certain medical professions. Landing anesthesiologists was a struggle, which led to Niagara Falls Memorial’s recent partnership with North American Partners in Anesthesia, a large national group, to provide anesthesia services at the hospital.

Ruffolo said hospital volumes are starting to return to pre-Covid levels, which could improve finances. The medical center last year recorded a net loss of $12.8 million on revenues of nearly $111.8 million. Through May this year, the system logged a $1.2 million loss on revenues of about $54.8 million.

Ruffolo said Niagara Falls Memorial is working with the Health Department now on its “transformation plans,” seeking to find the right path that will lead to a more sustainable operation. That may mean remaining as an independent system or finding a partner, Ruffolo said.

“At the end of the day, whatever path we end up on, it’s going to be a full-service health care delivery system here to serve the Niagara region – nothing less,” Ruffolo said.

Finding a way to survive

The longtime county-owned health system in Warsaw has made a series of moves in recent months geared toward creating stability, after it reported a loss of $9 million last year. 

Wyoming County Community Health System on June 1 suspended the maternal/obstetrics program – which was losing $3 million annually – at its Warsaw hospital. As a result, many of those baby deliveries will likely go about 25 miles away to United Memorial Medical Center in Batavia.

“Rural health care today is in crisis,” Wyoming County Community Health System CEO David Kobis said this spring. “There are literally hundreds and hundreds of hospitals across the country and many in New York State that are going through the same issue with their obstetrical programs.”

And more change could be ahead for the 62-bed hospital.

In a recent application to the state, the Warsaw hospital is seeking approval to decertify 27 inpatient beds so it can meet the bed number requirements to become a Medicare Critical Access Hospital, opening the door to cost-based reimbursement from Medicare. 

If approved, the hospital would become certified for 35 beds: 20 medical-surgical beds, 10 psychiatric beds and five intensive care beds. 

“The conversion to a Critical Access Hospital is critical to the hospital’s viability in the long term,” the application reads.