Franciscan Alliance demolishes historic Franciscan Health Hammond hospital amid protests

In 1898, three nuns took a train to the south shore of Lake Michigan to open a hospital.

They converted an old farmhouse in Hammond into a seven-bed medical facility. They treated their first patient for a broken leg amid carpenters hammering nails. Surgeons laid their patients on a kitchen table for operations.

The hospital – then named after St. Margaret, known for her service to the poor – eventually became one of the largest in the region. Hundreds of thousands of Indiana and Illinois residents took their first or last breath there.

One hundred and twenty-four years later, the hospital has, in a sense, come full circle. This spring, Franciscan Alliance, the nonprofit owner – which is still affiliated with the same Catholic order of sisters – plans to demolish most of the 226-bed Franciscan Health Hammond complex, leaving just eight beds, an emergency department and outpatient services. The move cost 83 jobs at the hospital and another 110 at an acute long-term care center that rented space there.

The news stung many in this town of nearly 80,000 people, which has seen businesses and neighbors flee Hammond for decades.

It’s especially painful, they say, because the hospital system has spent more than half a billion dollars in recent years on new facilities in more affluent and less diverse communities.

“It is deplorable that a Catholic institution like the Franciscans would make a financially motivated decision and leave thousands of people potentially in harm’s way,” said Mayor Thomas McDermott Jr., who says he was told of the downsizing just two hours later. before its announcement. “I’m not trying to be alarmist, but people are going to die because of this decision. And they know it.

Hammond Mayor Thomas McDermott Jr. said he was blindsided by the news that Franciscan Health Hammond was closing most of its inpatient services after 124 years.

But the larger question is whether Hammond needs a hospital with hundreds of beds, given the changes in medical practice and transportation in the 21st century. Only 50 to 60 of its beds are full most days, said Patrick Maloney, the hospital’s chief executive. Another hospital of the Franciscan Alliance is only 10 km away. Today, far more care is delivered on an outpatient or virtual basis than five years ago.

And Hammond Hospital had quality issues. It only gives one out of five stars on Medicare.gov, the lowest possible score and the worst of any of nine hospitals rated in Lake County, Indiana.

“Managing our resources is one component of our Catholic mission,” Maloney said via email. “The key to this is the effective delivery of care.”

He said Franciscan is investing $45 million to transform the campus and will continue to operate a medical clinic there for uninsured or underinsured patients, as well as offer services such as imaging, a medical laboratory and prenatal care.

While rural hospital closures often garner more attention, towns like Hammond have also been prone to the loss of medical services as health systems adapt to changes in care and choose to invest in places where more people have private insurance. But the closures raise questions about the changing mission of nonprofit hospitals — and who they help.

Since the 1930s, the urban hospitals most likely to close have been those serving low-income minority populations, according to a study by Alan Sager, a professor at Boston University’s School of Public Health. He calls large swathes of Detroit and New York “medical wastelands.”

When Hartford, Connecticut, City Hospital entered into a contract in the 1970s, it kept its emergency room in operation — until it became too expensive, Sager said.

“I predict that within a decade, despite the best intentions of everyone involved, it will prove financially unsustainable to support an eight-bed hospital plus ER in Hammond,” he said.

Hammond’s population is down about a third from its peak in the mid-20th century. Like other former manufacturing centers in the Midwest and Northeast, the city was hollowed out by deindustrialization and the flight of white people to suburban areas. It’s in the part of Indiana affectionately known as “the area” that’s essentially an extension of Chicago’s South Side, criss-crossed by freight railroads, dissected by freeways, and littered with factories in various states of disrepair.

On a recent morning, the Franciscan Health Hammond parking garage and surrounding grounds were mostly empty. A handful of people were leaving the hospital. A sign said birthing services had moved to the suburbs.

The ZIP code that covers the hospital and its surrounding neighborhood has a poverty rate of 36%, with a median household income of $30,400. Its population is 82% black or Latino. The hospital treats a large portion of patients on Medicaid, the government insurance program for low-income people, which typically pays providers a lower rate than Medicare or private insurance.

For Franciscan Alliance, the driving factors behind Franciscan Health Hammond’s shrinkage were the costs needed to maintain its aging infrastructure and the expected decline in demand for care in that region, Maloney said.

He said Hammond residents are welcome at the Franciscan Alliance Hospital six miles from Munster. The organization has spent at least $133 million in recent years on the facility, which is located in a more affluent suburb and just a few blocks from a larger competing hospital.

Carlotta Blake-King, Hammond resident and school board member.  She says she and other elderly people may not want or be able to - travel to a hospital six miles away as Franciscan Health Hammond closes most of its inpatient services.

Carlotta Blake-King, Hammond resident and school board member, says she and other seniors may not want or be able to – travel to a hospital six miles away as Franciscan Health Hammond closes the most of its inpatient services.

Carlotta Blake-King, a school counselor from Hammond, said it wasn’t close enough, especially since the area didn’t have much public transportation.

“I am an elderly person. I don’t like to drive,” she says. “Not everyone can afford a car.”

Free transportation to medical appointments, however, is provided by Medicaid and the local township.

Franciscan Alliance replaced older hospitals in other Indiana communities, albeit a few miles from their original location, spending $333 million on a new medical center in Crown Point and $243 million in Michigan City.

In 2018, however, it closed Franciscan St. James Health, a century-old facility formerly known as St. James Hospital, in Chicago Heights, a working-class suburb demographically similar to Hammond.

The missions of many not-for-profit hospital chains like the Franciscan Alliance have evolved. At the turn of the 20th century, hospitals often deliberately moved into low-income neighborhoods, with community members contributing time, money, and supplies. When St. Margaret’s opened, for example, local farmers donated food. The Internal Revenue Service exempted them, as so-called charitable hospitals, from paying taxes.

Today, “hospitals operate like corporations, like lucrative business entities, and their decisions are driven largely by financial concerns,” said Ge Bai, a professor of accounting and health policy at Johns Hopkins University. “The line between today’s nonprofit hospitals and for-profit hospitals is very, very blurred.”

In 2018, nonprofit hospitals provided less out-of-reimbursement Medicaid and charity care than their for-profit counterparts, according to Bai’s research. But she noted that the Franciscan Alliance spent more than the nonprofit average on both fronts.

Pat Vosti, a retired nurse from Hammond, worked in the hospital’s cardiology unit, so she knows time is running out in healthcare. She worries about patients who need to be redirected to other hospitals.

“It’s a matter of minutes, but minutes count in some cases, you know?” she says.

But people have been bypassing Hammond Hospital for years. With its sister campus in Dyer, it has just 15% market share, according to a 2016 bond filing, compared to 45% for Franciscan’s facility in Michigan City and 38% for Crown Point.

“Now why they didn’t use it might be a function of management choices made 15, 20 years ago: ‘Don’t build this new emergency room, don’t hire these young doctors, don’t open a substance abuse ward,” said Nancy Kane, adjunct professor at the Harvard TH Chan School of Public Health. “It’s usually a gradual death. These places don’t go bad all of a sudden.

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism on health issues.

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