Charles R. Drew Medical Center opened its doors to a largely black community in Houston last November, was dedicated in April -- and closed in June.

The 40-bed institution had hoped for recognition as the newest member of the nation's dwindling cadre of black hospitals. Instead, it joined a long list of casualties.

A quarter century after the fierce civil rights battles, black health care institutions are facing their biggest struggle yet -- staying open against a combined assault of financial operating pressures and public indifference to their contributions.

More than 200 historically black hospitals dating to the 1800s have been identified by Vanessa Gamble, a social historian and physician who is assistant professor of the history of medicine at the University of Wisconsin at Madison. Although formed specifically to serve blacks, these facilities weren't necessarily owned by blacks.

Today, there are only eight: George W. Hubbard Hospital in Nashville; L. Richardson Memorial Hospital in Greensboro, N.C.; Newport News General Hospital; Norfolk Community Hospital and Richmond Community Hospital, all in Virginia; Houston's Riverside General Hospital; Southwest Detroit Hospital, and the largest and best-known -- Howard University Hospital in the District.

The next few years will be crucial for these institutions, according to health care economists. Established to serve a population ignored by most white-owned institutions, black hospitals must make significant changes or merge with other facilities if they are to remain open.

Factors hastening their demise include the growing number of black physicians leaving for better-funded, non-black hospitals; insufficient capital to make improvements or to compete with major hospitals in attracting new patients; a swelling population of indigent or uninsured patients and increasing skepticism about the value of black hospitals.

By virtue of their location, many black hospitals face the same struggles against social ills as do other inner-city hospitals -- drugs, AIDS and violence.

"It's like taking a razor blade and cutting a rope one string at a time. Eventually, the rope is so frayed that it just snaps. That's what's happening now," said Frederick D. Hobby, former executive director of Newport News General Hospital who is associate administrator at the 184-bed Portsmouth General Hospital in Virginia.

"The few existing traditional (black) hospitals will, perhaps, continue to exist, but in a different form," said Nathaniel Wesley, director of the National Association of Health Services Executives, an organization of about 500 black executives.

"The facts speak for themselves; there's been an average of two to three black hospital closures per year since 1961," said Wesley, who has studied and written about the history of black health services. Ironic Legacy of Civil Rights

Ironically, black hospitals began to lose ground with the advent of the civil rights movement in the 1960s. As the black middle class found opportunities to live and work outside inner-city neighborhoods served by black hospitals, they moved to areas served by traditional community hospitals. The demographic shift was a serious blow to black facilities.

"Integration is not a two-way street. Blacks will go to white people for services, but white people in general will not go to black people for services. When the barrier to segregation fell, {that was} probably the most significant event leading to the problems of black hospitals," said Reginald Ayala, president and chief executive officer of Southwest Detroit Hospital.

Recently, Southwest and nine other black and inner-city hospitals each contributed $5,000 to launch the National Hospital Association, an organization created to address the financial plight of black hospitals and other inner-city facilities. They will use part of that money to retain WRC Associates, an Atlanta-based consulting firm.

"We felt the American Hospital Association and the local associations did not adequately address the problems of our hospitals or give enough attention to the minority populations of these cities," Ayala said.

The organization initially will focus on helping hospitals develop their own versions of programs that have worked well at other member facilities. Southwest will share information about its managed-care business, and Howard University Hospital will offer information about its nurse retention program, in which it supports nursing aides while they pursue their degrees. The association also hopes to improve black hospitals' financial planning.

But for some black hospitals, help may be arriving too late. "Most of our members are in a survival mode with everyday crises," Ayala said.

That wasn't always the case.

"Before 1965, these institutions were crucial. If they didn't exist, many blacks would have had no care, and the black medical profession would have been demolished because so few would have been allowed to do internships and residencies {at non-black hospitals}. They were an integral part of American history, and there has to be a recognition that, even though they've become peripheral to many people, they're essential to people in those communities," said Gamble, the Wisconsin historian.

"Most people do not even know black hospitals exist, that they ever existed, that there ever was hospital segregation or that people were denied access based on the color of their skin," she said. Surviving -- With Difficulty

Gamble believes the larger black hospitals will survive, but not without a struggle. She believes the smaller ones will close or merge with other small facilities.

In Baltimore, for instance, Provident Hospital merged with Lutheran Hospital of Maryland in August 1986, creating 282-bed Liberty Medical Center. But Liberty no longer considers itself a black hospital, even though it's in a largely black area and has a predominantly black patient population, said Avery J. Dover, its interim president.

"We are an inner-city hospital that serves a predominantly black community," he said, pointing out that both the medical staff leadership and hospital board of directors are racially mixed.

Wesley of the National Association of Health Services Executives said 500 to 600 hospitals mostly treat black, inner-city residents but "are not prepared to be considered principally black."

Liberty reported operating income of $1.1 million on patient revenues of $52.7 million for the 10 months ending April 30.

Another black hospital facing transition is Newport News General, where 17 administrators in 10 years have battled financial challenges. AmeriHealth, a Richmond firm, began managing the hospital in February under a five-year contract with the institution's board of directors.

A group of 40 physicians, about 35 of whom are black, hopes to buy the hospital. The group is awaiting final approval of its $25 million offer from the Department of Housing and Urban Development, said Valrie Honablue, president of the investment group. The group has raised $1 million and expects to raise an additional $3.33 million through a limited partnership; the group will obtain financing for the rest, she said.

The physician buyout offer represents "one of the last possibilities to save the hospital," said William S. Vokonas, an AmeriHealth employee who became Newport News's CEO in May. "If for some reason this hospital doesn't make it, it'll be a real tragedy."

Vokonas said he intends for the facility to serve the same black community but with some differences in services. For example, he wants to upgrade outpatient surgical services and laboratory services but de-emphasize home health care and other services that are "nice to have but not generating particular revenues."

The hospital lost $740,000 on revenues of $12.8 million for the fiscal year ended June 30, 1989, said Bob Sherrill, interim chief financial officer. Outpatient services generated $2.9 million of those revenues. In fiscal 1989, Newport News had an average occupancy rate of 34 percent.

Wooing Black Doctors

Attracting black physicians is a major challenge for black hospitals.

John N. Doggett, president emeritus of 143-bed Central Medical Center Hospital, St. Louis, blames part of black hospitals' trials on "the many physicians fresh out of medical school who we nurtured and helped get their feet on the ground but who then left us for some of the non-black institutions."

He tells them, "Don't desert those that gave you your start. Work within those institutions to make them comparable or competitive to the institutions that attract you. The opportunities for (positions like) chiefs of staff won't be offered to you in (non-black) institutions. Make the black institutions the giants they can be, and you'll gain the respect and recognition there that you seek."

Wesley said black physicians' interest in black hospitals "has waned tremendously." Four predominantly black medical schools awarded about 20 percent of the medical degrees granted to blacks in 1987. In addition to Howard, they are Charles R. Drew University of Medicine and Science in Los Angeles; Meharry Medical College in Nashville and Morehouse School of Medicine in Atlanta, the institution that Health and Human Services Secretary Louis W. Sullivan once headed.

But a generation ago, in 1967, two of these schools -- Howard and Meharry -- were responsible for awarding medical degrees to 83 percent of the 6,000 practicing black physicians, according to a special report on minority medical training by the Robert Wood Johnson Foundation in Princeton, N.J.

Currently, 16 percent of the nation's physicians are black, said the National Medical Association, a Washington-based black professional organization that dates to 1895.

Historical Significance

"Black physicians trained in the '40s and '50s had hardly any choice in residence or internship except for black hospitals. They developed somewhat of a loyalty to their communities, but they're dying out. As the older ones pass away, the younger ones aren't practicing at those institutions," Wesley said. In fact, they "have no sense of the fact (that black hospitals) exist or are in trouble."

"Unless the person is really interested in family practice, he or she is just not going to find {black hospitals} attractive," he said.

Brenda Burns-Livas, who was marketing director at two black hospitals before financial pressures eliminated both jobs, is more blunt. To many black physicians, working at non-black hospitals means they've "arrived," while working at black hospitals means "you're here because you can't do any better," she said. "That's a cruel perception, but people operate on perceptions."

She suggested that black medical students be educated about the historical significance of black hospitals. If they understood, for example, that Newport News General was created because local blacks in the 1800s could find medical care only at the city jail infirmary, they'd understand the importance of keeping them strong, she said.

Most recently, more interest from black physicians in Houston might have kept Drew open, some observers said.

"Where was the support? If each of those physicians (the 60 minority physicians with admitting privileges) had put just one patient in there," Drew might not have failed, said Willy Kuehn, chief financial officer of Houston-based Sisters of Charity of the Incarnate Word, which had to foreclose on Drew's mortgage when the facility was unable to meet a $2 million loan payment last May.

Drew, with about half of its beds empty, closed because of a "lack of operating capital. We weren't able to expand into the services we wanted to," said Walter L. Jones Jr., Drew's former CEO.

Indeed, access to capital and adequate cash flow are major problems for black hospitals.

Black hospitals often absorb a disproportionate share of their cities' uncompensated-care load. They traditionally have been "the place people feel they can always go and expect to get treated," said Wesley.

"These hospitals have historically been disadvantaged. They've struggled since their inception and have always been on the brink. They're financially vulnerable," Gamble said.

Finances are such that Burns-Livas was laid off as marketing director at both Newport News and Norfolk Community in cost-cutting measures. She worked at the former for a year and the latter for slightly longer; she began a new job in June in public affairs for the American Heart Association in Virginia Beach.

The financial outlook at some black hospitals is so bleak that some institutions "don't want the bad news to be told," Burns-Livas said.

Drew's Jones is sometimes asked whether institutions directed at blacks have outlived their usefulness in the seemingly integrated 1990s. "I often {respond}, 'Is there still a role for Catholic hospitals or Jewish hospitals?' " He noted that the three share some common origins, each having been formed to meet the special needs of a particular population. "There's no question in my mind that there's still a role for black hospitals."

Problems of Black Businesses

Those struggling to keep black hospitals open said the benefits of black hospitals still exist for patients and physicians. One reason is that blacks have greater health problems than whites -- because of a variety of economic, societal and genetic factors -- and black health professionals are more aware of those conditions.

For example, blacks with vitiligo, an autoimmune disorder that causes skin to discolor in white patches, find a stronger support system in black hospitals than in white hospitals, according to findings by Judith Porter, a sociologist at Bryn Mawr College. This is partly true because, "in a consonant racial context," afflicted blacks can see others in the waiting rooms with the same condition, increasing their level of comfort and providing support networks, she said.

Black health care administrators say that black hospitals must be viewed in the larger societal context of black businesses and organizations.

"The plight of black hospitals must be related to (the plight of) institutions in the black community, period. When one takes the broader view, the future of black hospitals is no different from the future of black institutions in this country. They have all changed and will continue to change," Wesley said.

"They're the only hospitals around in some of these communities," Gamble said. The elderly, especially, would have significantly reduced access to health services, she added.

In addition, black medical students who might experience "an element of isolation" at non-black institutions are likely to develop a sense of "pride and identity" at black institutions, Doggett said.

Many attorneys, accountants and insurance brokers developed their skills working with black hospitals. "That's how many black entrepreneurs got started; when you close that place, you close those slots {for professional advancement}," Wesley said.

For black hospitals to survive, he said, whites must accept "the role and legitimacy" of black institutions, and middle-class black communities must renew their commitment to keeping black-owned institutions alive.

A national endowment fund for hospitals could improve black health facilities the same way the United Negro College Fund helped black schools, Burns-Livas said.

Two years ago, she tried to rally community and business support for such a fund, which she wanted to launch with a national "radiothon."

She remembers being told at the time, "The problem is you're too late by about 20 years." Although that didn't deter Burns-Livas, the project was abandoned when it failed to attract sufficient support.

Reprinted with permission from Modern Healthcare.

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