Keeping the Care in CareGroup,

Beth Israel/Deaconess Struggles for Solvency

By Susie Davidson

Advocate Correspondent

Reports of the precarious state of affairs at Beth Israel Deaconess have not been exaggerated. The October 1996 merger of the two incongruous hospitals has been problematic from the start, with major personnel shifts, and a rapidly declining financial state, resultant, unfortunate realities.

Yet this mainstay of the CareGroup team encompasses far more than its current condition, and it may well be its stellar approach to health care, accomplishments, reputation, staff and history which hopefully, and ultimately, might save the day for the staid and distinguished worldwide institution.

"The financial problems the hospital is experiencing will demand intensive work," says board chairman Robert Melzer, who is operating the hospital while a search continues for a new CEO to replace Dr. James Reinertsen, who was asked to leave this past July. (BI Deaconess President Michael Rosenblatt also departed in September.)

Melzer, a New York native, retired three years ago from the real estate financing industry, where he had been since 1969. Residing in Brookline since 1973, he was part of the original 1983 Beth Israel board. He was instrumental in the Deaconess merger, and has organized a group of hospital and medical school personnel to strategize methods by which a return to profitability might be realized.

CareGroup, employing 13,000 as well 2,000 medical staffpersons, links the Beth Israel Deaconess Medical Center, Mount Auburn Hospital, New England Baptist Hospital, Deaconess Waltham Hospital, Deaconess Glover Hospital and Deaconess Nashoba Hospital in the provision of community-based primary care and specialty services.

Beth Israel Deaconess has intrinsically been associated with a special approach to primary care, which concentrates upon prevention and the patient as a whole, rather than the presenting illness alone. "We call ourselves 'Harvard with a Heart,'" says Melzer. "Our commitment to compassionate service, which was always the tradition at both Beth Israel and Deaconess, is most important."

"The Steering Committee has been charged with guiding this recovery process," he explains. "They are looking at everything." He can't say what their findings might be, but does feel that profitability by next fall is a feasible vision.

Hospital turnaround consulting firm the Hunter Group has also been hired; a January report on potential layoffs and program cuts is anticipated.

How bad is the financial picture? Reports hold that there is $310 million in available cash and investments, but Melzer states it is more like $200. "For a hospital that grosses $700 million per year and is still sustaining losses," he says, "that is obviously far too low."

What does he feel is a major cause of CareGroup's predicament? "The current climate," Melzer says, "is that society demands top-flight health care. Our scientists are continually inventing processes and discussing ways to prolong life and keep people healthier. As a consequence, great expense is required. For example, the successful treatment of cancers comes at enormous cost, and the insurance industry has been loath to pay for it.

"And most deficiencies," he continues, "are incurred from those who can't pay. We belong to the Free Care Pool, which is a significant expense for all hospitals."

Judy Glasser, Vice President of Communications, explains thusly: "All hospitals pay into the pool; different hospitals draw from it in variable amounts, according to location and other factors. They are reimbursed for a percentage of the costs. Last year, hospitals put in $220 million; states put $100 million in, but they get reimbursed by the federal government. Many say it's time to change the formula."

There are definitely bright spots. Just last month, the Joint Commission on Accreditation of Healthcare Organizations gave the hospital high grades following a three year survey, with three representatives extensively reviewing the premises on-site. Rapport is smooth; promising staff have been hired. New initiatives such as the much-lauded Berenson Emergency Department, which opened this past July 17 at the West Campus, and a brand new primary care unit (where 20 to 30 patients and their families will be able to use computers to directly participate in their medical care plans) have been unveiled.

Beth Israel was established in 1916 in Roxbury to care for the growing local Jewish community. In 1928, the facility became a Harvard Medical School teaching hospital and moved to Brookline Avenue.

"The tradition of solely Jewish hospitals is clearly fading," Melzer explains, "but our longstanding commitment and support to the Jewish community is not. Of course," he adds, "we don't turn our back on any community."

New head of surgery Dr. Josef Fischer, who plans to expand the department by five to 10 surgeons and increase patient numbers, is a Yeshiva University as well as a Harvard Medical School graduate. Dr. Benjamin Sachs, Chief of Ob Gyn, was awarded the Jewish National Fund Tree of Life Award this past Dec. 11. Dr. Selwyn Oskowitz just received CJP's Health Professions Group Award; nurse Judi Hirshfield-Bertek recently received the Jewish Women's Archives/Hadassah Women Who Dared Award.

Can the Jewish community help? "We are not currently involved in any major fundraising drives," Melzer says, "but there is always the Annual Fund. Donations, many from former patients, certainly help counter the deficiencies we're experiencing." In fact, two million has just been raised from former patients for primary care services.

"Donors have always been important," Melzer continues, "have always had a special place at Beth Israel Deaconess. They have been integral to maintaining the level of care and ongoing research."