Church Hospital -- Baltimore's second-oldest and the building where Edgar Allan Poe died and Union soldiers wounded on Pratt Street in the beginning of the Civil War were treated -- will close its doors this fall.
In the shadow of its world-class neighbor, Johns Hopkins Hospital, Church served the East Baltimore community, particularly the elderly, for 142 years, earning a reputation for caring and homeyness. Over time, however, families that traditionally turned to it began moving to the suburbs, leaving it with empty beds and lower income.
Yesterday, the graceful red-brick building on Broadway, with a spectacular view of the downtown skyline, had entire empty floors, signaling that the hospital hasn't been fully occupied for several years. Church was losing money and was under pressure from state health regulators to lower its rates.
Its closing was announced yesterday by its parent, MedStar Health of Columbia.
"Closing Church Hospital was a difficult decision to make," said John P. McDaniel, president and chief executive officer of MedStar. "Given the current climate of overcapacity in an extremely competitive market, we have determined this to be the prudent course of action."
MedStar, which also operates six other hospitals in the Baltimore-Washington area, will try to place as many as possible of Church's 800 employees in its other facilities, said John Marzano, a MedStar spokesman. He said he did not have any projections on how many could be absorbed into the MedStar system.
Two other hospitals have closed in Baltimore this year. State regulators have been aggressive in holding down the rates hospitals can charge.
The most pressure has been on small hospitals, which have higher overhead costs, and urban hospitals, which treat more uninsured patients. Church was both.
State health planners say Baltimore has about twice as many hospital beds as it needs. Many of the hospitals are operating below capacity as HMOs move more care to outpatient treatment and press for shorter hospital stays.
Closing Church "takes some unnecessary capacity out of the system," said Robert Murray, executive director of the Health Services Cost Review Commission, which sets hospital rates.
"The patient volumes can be spread across other facilities, which will have more opportunity for cost savings."
Acute hospital services will end at Church by Nov. 30, MedStar said, while a nursing home and assisted-living facility on the Church campus will close by June.
The 121-bed nursing home and 115-bed assisted-living facility were operating near capacity. However, it would be difficult to keep them operating without the hospital, said Pete Kerzel, a Church spokesman.
"The acute care services were kind of the crux of this triangle," Kerzel said. "When the acute service suffers, the nursing home suffers, because that's where 75 percent of its admissions come from."
Licensed for 144 beds, Church has 67 patients on an average day, and annual admissions having fallen 50 percent in the past seven years, according to Marzano. It needs 29 more patients a day -- an increase of about 30 percent -- to break even, he said.
The hospital lost $3 million in the fiscal year that ended June 30 and was projected to lose $6 million this year.
It was also facing a further squeeze from the cost review commission. Murray said the rate-setters were concerned that Church's cost per case was 6 percent above the state average, and were considering a review that could have lowered rates.
The regulators were also eyeing Franklin Square Hospital, another MedStar facility with above-average costs.
Murray said MedStar was seeking higher rates at Union Memorial Hospital, where costs are low. With the Church closing, he said, the regulators can recommend new rates at the other two MedStar facilities and avoid a lengthy rate review.
Plans are still being developed for when Church will stop admitting patients, Marzano said. He said any patients or residents remaining at closing would be transferred to other facilities.
MedStar hopes to sell the Church property, he said. Hopkins has indicated that it is not interested in acquiring the campus.
In 1857, the Church Home Society, affiliated with the Episcopal Church, purchased what had been Washington University School of Medicine to create what was called Church Home and Infirmary, which concentrated on treating the elderly. Poe died in 1849 in the medical school building, which is still used by Church.
The hospital treated Union soldiers injured in the Baltimore riots fomented by Southern sympathizers at the outbreak of the Civil War in 1861.
Over time, a hospital and other services were added. Church was the first hospital in Baltimore with an intensive care unit and the first with hospice care.
In 1995, Church became part of Helix Health. In 1998, Helix merged with Medlantic Health of Washington to form MedStar. Helix and MedStar invested in improvements, including a renovated emergency room.
Church had two programs not offered elsewhere in MedStar -- renal dialysis and adult day care. Marzano said these will be "transitioned to other facilities," although plans are not complete.
Under a state law which becomes effective Oct. 1, regulators have no say in whether the hospital can close, but Church must conduct a public hearing. Closing a nursing home does require regulatory approval, said Pamela Barclay, acting director of the Health Resources Planning Commission.
Sun staff writer Shanon D. Murray contributed to this article.
Pub Date: 9/23/99