Is New York State’s Hospital Ratings System Actually a Hit List?

In New York State, a hospital ratings system was developed to help determine the best way to spend available funds. Not surprisingly, that effort has generated considerable controversy, as described in an article in Modern Healthcare on November 28, 2006.

New York’s Commission on Health Care Facilities in the 21st Century published the framework for a rating system to help prioritize hospitals and nursing homes in need of “restructuring” and “reconfiguration.” David Sandman, the commission’s executive director, was quick to say “These ratings are not the final determination, and the ‘high-priority list’ should not be considered a hit list.” Greater New York Hospital Association President Kenneth Raske estimated that fewer than 24 hospitals would be tagged to be restructured or closed.

Interestingly, the press release put forth by the Commission on Health Care Facilities in the 21st Century the same day painted a different picture. “Nearly fifty hospitals will be restructured and nine will be closed,” according to the release. How could this hospital rating system have turned into a hit list in mere days between the Modern Healthcare interview and the press release?

The answer, it seems, is that money was readily available for repairs and restructuring, so the Commission thought best to make use of those funds. According to the press release, “Financing is available to implement these recommendations. The Health Care Efficiency and Affordability Law for New Yorkers (HEAL-NY) allocates $1 billion to fund system restructuring and facility closing costs. The federal government has also promised New York State an additional $1.5 billion for similar purposes through the Federal-State Health Reform Partnership (F-SHRP). To receive the F-SHRP funds, the Commission’s recommendations must be accepted by the legislature and implemented.”

What is interesting about the factors used to rate hospitals— vulnerable populations, availability of services, quality of care, utilization, viability, and economic impact—could easily be used to rate laboratories at some future date. Should an insurance provider or state Medicaid program choose to rate laboratories, some laboratories could fall victim to the same sort of “hit list” as did hospitals in New York State.

Further, the concepts of looking at the populations and communities served by hospitals and laboratories, in addition to more traditional measures such as quality of care, utilization, and economic impact, show how efforts to balance healthcare infrastructure in selected regions could negatively affect existing providers in that area.

However, the effort by New York’s Commission on Health Care Facilities in the 21st Century to create a rating system for hospitals and nursing homes demonstrates that efforts to rank providers based on quality of care, cost, and other factors continue. It is probably only a matter of time before some agency – public or private – develops a rating system for clinical laboratories. For that reason, lab directors and pathologists should be taking active steps in their laboratory organization to improve the quality of care and delivery of services.