Cook Children’s Says Census Snag Will Force Hospital To Close, Reopen as Surgical Center

Hurst-based Cook Children’s Northeast Hospital will close on April 20 and begin a transition to become an ambulatory surgery center, with the new name of Cook Children’s Surgery Center, according to a news release. Here’s how the release from Cook Children’s Health Care System describes the decision:

In late 2017, the Centers for Medicare and Medicaid Services (CMS) issued a memo defining the overnight census requirement to operate as a hospital. Cook Children’s Northeast Hospital, located at 6316 Precinct Line Road in Hurst, Texas, does not meet the census requirement and will no longer be able to operate as a hospital.

The memo referenced—I believe I’ve located it here—contains CMS’ move to redefine what constitutes who can or can’t call themselves a hospital under Medicare and Medicaid. Under the new definition, things like average daily census and average stay can be taken into consideration.

The memo casts those merely as pieces to the puzzle, but it appears Cook Children’s leadership has determined it won’t be able to overcome the census requirement. (I’ve reached out to to gauge how they made the call, and I’ll update here or post anew if and when I get answers. Update below.)

The release says only that the board that oversees the hospital made the decision on the new direction. Cook Children’s says it will “assume ownership and operations of the Urgent Care Clinic, Imaging Center, and Draw station at this location” on April 23.

The surgical center will open on May 1 and run as a joint venture between Cook Children’s, NueHealth, and physician investors.

The transition will result in 150 lost jobs, the release said.

Update: Here’s what I was told by a Cook Children’s spokesperson:

The driving factor in deciding to transition the facility was based on our census and the definition of ‘hospital’ provided to us by the CMS. Our census in 2017 was 0.11 and so far for 2018 the hospital census stands at zero. The census – average of 2 patients – is what defines hospital by CMS standards. This was the exact wording provided by CMS on September 6, 2017. With this information, it was clear to us we needed to make some difficult decisions in order to continue to provide quality medical service to that community.

If you wade further into that memo—and without getting too deep into the weeds for the purposes of this post—you do eventually get to a piece, on page 10, where it says in a roundabout way that a hospital should have an average census of at least two patients. CMS surveyors will come by, and if the facility doesn’t have patients, plural, they’ll ask if it usually has patients, plural, and the answer to that needs to be yes.

That requirement is simply the minimum threshold in CMS’ process of determining whether a facility is indeed a hospital under its new standard. Cook Children’s Hurst location didn’t meet it, so it decided to change course.

  • Cook’s Northeast will be just the first shoe to drop. The new CMS guidance will (and should) cause a complete reexamination of the “micro-hospital” trend, and will expose the actors who misrepresent what their facilities actually do or what their population health intentions truly are.

    • Sara

      The CMS guidance may also create an incentive for these facilities to push the envelope and keep patients hospitalized just a bit longer than medically necessary, ensuring that they will meet the guideline. I wouldn’t put it past the administration of the health system Indiana who enjoys gaming the system. They will find a “creative” way.