Hospital closures greatly affect Black community

Within the last decade, almost 50 maternity wards have closed throughout California, with more than half shutting down within the past four years. The past decade saw a drastic number of cutbacks in maternity care, with cozy and more personalized maternity care being increasingly rare. Maternity costs are subject to major losses for hospitals.
Nearly 20 closures took place in Los Angeles County. There are several for-profit hospitals that are owned by multi-state corporations. Data from the state demonstrates that over half of the hospitals were closed while the hospital was generating millions of dollars for investors. Patients who lost access to the hospitals were the state’s poorest patients. A hospital that mainly serves low-income patients was generating more than 13 times the median hospital operating margin in California upon shutting its labor and delivery unit.
Government-run and nonprofit hospitals do their best to maintain labor and delivery units according to state data on hospital finances. In order for hospitals like Martin Luther King Jr. Community Hospital in Watts to maintain their tax-exempt status, they must address community needs. MLK leaders are fighting to keep maternity services operating. Hospitals that generate profits lose a large amount of money on maternity care. Maternity care service has become a money-loser of late. Medi-Cal’s public insurance program, which covers about half of births in California, is set at the fifth lowest reimbursement rate for obstetrics, according to the Kaiser Family Foundation. Additionally private insurance pays almost five times more for a vaginal delivery with no complications.
For-profit hospitals usually cut maternity care services. There is no law that prevents them from being cut. In Los Angeles, specifically, there is a disproportionate effect on low-income Black and Latino communities according to CalMatters. Several closures took place in hospitals where 80 percent of patients had Medi-Cal. Patients in this population had some of the worst pregnancy-related complications and mortality outcomes in the state.
“Marginalized patients, women particularly… have really observed the decline in their care even in a place like California,” said Dr. Laila Al-Marayati, division chief for obstetrics and gynecology at Keck Medicine of USC and Los Angeles General Medical Center.
California has failed to prioritize women’s health for decades causing Medi-Cal obstetrics rates to rise within recent times. Hospitals that have a high number of Medi-Cal patients experience difficulty in breaking even financially in terms of obstetrics. Maternity care is low on the list of lucrative hospital services which lead to the wave of hospital closures. South Los Angeles in particular has taken a hard hit with the loss of two maternity wards, including Centinela Medical Center and Memorial Hospital of Gardena Medical Center. Both are for-profit hospitals that also serve the highest number of Black Californians in the state.
MLK operates one of the last maternity wards in South Los Angeles. The hospital offers a midwife-led program that is known statewide for its healthy outcomes for mothers and children. Unfortunately this program too is at high risk. As of last year, the hospital was operating under a $42 million deficit. The hospital recently received $20 million in grants from Los Angeles county that will help keep it open until next summer. However, the hospital has a much larger funding problem. Medi-Cal doesn’t generate enough income to pay hospitals and doctors enough to keep up Medi-Cal pays for at least 71% of the cost of delivery. However the hospital loses over $2 million yearly on the maternity ward. The maternity ward is essential to the hospital’s mission.
California has undergone a loss in terms of maternity care. More than 14 percent of 337 medical facilities ceased offering maternity services in 2011. Many hospital administrators feel the state could make a difference by increasing the amount that Medi-Cal pays for births to incentivize hospitals to keep the services open. Last year, lawmakers approved a rate increase which brought up pay for some obstetric services. Gov Gavin Newsome proposed canceling additional increases to address the budget gap. The California Department of Public Health has mentioned that they are aware of hospitals reducing or eliminating labor or delivery beds but throughout the course of the past three years the total number of beds in California has increased.
Some experts believe that federal intervention is necessary to slow down closures. They’ve suggested policies that would make closing maternity services harder in underserved communities. Private hospitals don’t have to disclose reasons for getting rid of service. A bill by Assemblymember Akilah Weber (79th District) would require hospitals to let the state know a year in advance if a maternity ward is in danger of closing due to financial or staff limitations. More than 90 percent of patients who visit MLK are covered by public insurance programs such as Medi-Cal or Medicare. Most hospitals that still retain maternity wards heavily rely on private insurance. Thirteen of the seventeen hospitals that were closed in L.A. County happened at hospitals that serve mainly low-income patients. Six of the closures happened in areas where there is a shortage of medical providers which makes it difficult to get any health care at all.
Often, Medi-Cal patients encounter difficulties and challenges because of delays (red tape). Appointments for pregnant Medi-Cal patients frequently get postponed. Some hospitals have stopped taking in high-risk Medi-Cal patients. Delays can make maternal and infant health disparities worse and also increase the possibility of a pregnant patient needing a cesarean section. There are high costs associated with keeping specialized staff available around the clock. Additionally low payment and high malpractice risk make labor and delivery very challenging. Experts say that hospitals can regain losses on other services.
Centinela Hospital (Inglewood) consolidated services with St. Francis Medical Center in Lynwood. About 10 miles separate the two facilities. In 2022, 732 babies were born at Centinela Hospital and 2,762 were born at St. Francis that year. St. Francis was able to give high quality care with a plethora of various services. Memorial Hospital of Gardena stopped delivering babies. Memorial’s maternity ward was closed in 2020.
Nonprofit hospitals can be a major part of a large and well-funded system like Kaiser Permanente and Sutter Health. In order to remain tax-exempt they are required to assess the needs of their community and invest in those needs. The attorney general has regulatory power over nonprofit hospital acquisitions. This is not the same situation for for-profit systems. For-profits have more freedom in prioritizing their bottom line.
“In order to make money, you have to increase your revenue or decrease your expenses,” said Ge Bai, professor of health policy and management at Johns Hopkins University. “To decrease expenses is to cut off those unprofitable services.”
After Centinela ended its maternity program, Black Women for Wellness canvassed the region and visited households within 10 miles of the hospital. They conducted a community town hall to observe and assess the impact. Black and Latino residents of Inglewood felt abandoned. The community was still dealing with the death of April Valentine, a young woman who died during childbirth at Centinela nine months before the hospital stopped labor and delivery care. The state fined Centinela $75,000 for lapses in care.