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click to enlarge City Councilor Pat Dowd, head in hand, and Mayor Luke Ravenstahl listen to questions about the potential loss of 1,500 jobs at West Penn Hospital. - JOHN ALTDORFER
  • John Altdorfer
  • City Councilor Pat Dowd, head in hand, and Mayor Luke Ravenstahl listen to questions about the potential loss of 1,500 jobs at West Penn Hospital.

Like a diagnosis that confirms a patient's worst fears, the news that West Penn Hospital is transferring key operations out of its Bloomfield facility has left Pittsburghers numb. Up to 1,500 jobs will be affected, the emergency department will close in January, and programs like cardiovascular, critical care, oncology and other medical and surgical programs will relocate to Allegheny General, the North Side sister facility operated by West Penn Allegheny Health System. 

"Our community is grieving," one woman said at a June 30 meeting with WPAHS brass.

"What am I supposed to do?" asked North Oakland resident Mike Pastorkovich, who says his insurance doesn't cover UPMC doctors. "Go to UPMC and pay out-of-pocket, or get on a bus and go to Allegheny General and see if I live?"

"It was a terrible decision. It was a difficult decision," WPAHS board chairman David McClenahan told the crowd. But unless it was made, he added, "We will not survive as a system. We will be gone."

Experts in the field say that's probably true. And while such disruptions may continue -- a symptom of the changing nature of health care -- Pittsburgh's vaunted "eds and meds" economy should be able to shake off the worst of it.

The West Penn system lost $11.6 million in a nine-month period ending March 31. Reimbursements from state and federal government are declining, the Bloomfield hospital is operating at 47 percent capacity and more are seeking outpatient services. While the Bloomfield facility will still house functions like the burn unit, a Women and Infants' center, and rehab services, officials say it has to eliminate redundant services to stop the bleeding.

"If this is what's necessary to keep the system healthy and viable, it may be the best out of a set of bad alternatives," observes Marty Gaynor, a Carnegie Mellon University economics professor. "It's pretty clear something had to be done. It's important for the city and region for the AGH system to be healthy and viable."

For one thing, Gaynor says, WPAHS is the only thing "standing between us and a monopoly by UPMC."  If UPMC were the only health-care provider in town, it would eliminate choice and competitive prices. 

That possibility worries people like Pittsburgh City Councilor Patrick Dowd, whose district includes Bloomfield. "We've got to, as a community, ask questions about health-care choice and how we are going to guarantee more than one system and more than one provider," he says. 

Dowd and residents at the community forum also fretted about how familiar it all was. Could Pittsburgh once again be brought down by relying too heavily on an industry, they wondered the way it once did with steel? 

Duquesne associate economics professor Antony Davies acknowledges the fear, but doesn't see an economic parallel. The domestic steel industry collapsed in large part because of cheaper foreign competition, he says: "It got to the point where companies couldn't compete with foreigners. That's not the case with medical care."

Still, having your hospital move across town is bad enough, many West Penn neighbors say -- especially for the elderly or those who rely on its emergency room for aid.  Heart-transplant recipient Arleen Szczypinski acknowledges she's been happy with treatment she has received at AGH, but is concerned about losing an ER in the neighborhood. Many patients, she says, "have to walk. ... When you're elderly and you need emergency services, the closer the better."

But West Penn isn't the first hospital to make such a move -- and it likely won't be the last. UPMC closed its Braddock hospital in January; prior to that it merged its South Side hospital-campus programs with Mercy in Uptown, leaving South Side as an outpatient center. St. Francis Medical Center closed in 2002.

Such closures and consolidations signal an underlying shift in the health-care sector, says Frank Gamrat, senior research associate at the Allegheny Institute for Public Policy. Even while health care has been thriving locally, he says, hospitals have been ailing, thanks partly to a trend toward more outpatient facilities opening up.

According to the Bureau of Labor and Statistics, Pittsburgh-area hospitals shed 600 jobs between May 2009 and May 2010. They've cut 2,200 over the past 10 years. But during that same period, Gamrat points out, employment in subsectors like social assistance -- things like social-work jobs or child daycare services -- grew by about 10,400. Ambulatory care, or outpatient services, grew by about 15,900 in the same period.

To him, that signals that the "meds" economy isn't dwindling -- just changing. 

Gamrat says that when we think of the health-care business, "We automatically think hospitals. But there are a lot more [components] to it and those subcategories are growing." And even for those whose jobs are lost, Gamrat says, there's reason for some optimism. "No one wants to lose their job. ... But you have skills that will easily transform to other medical avenues."

"In the short term, there will definitely be a blip here," observes David Dausey, a CMU professor and senior director of the school's Health Care Programs and Initiatives. "You know there's going to be considerable heartache: 1,500 -- that's a lot of health-care jobs."

Even so, he agrees with Gamrat that the industry is large enough to absorb the blow: "This is clearly what Pittsburgh does," Dausey says. 

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