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Mount Sinai Beth Israel Selling Gramercy Hospital, Citing Costs

Another hospital bites the dust, sort of.

Mount Sinai Beth Israel will be closing its 825-bed facility in Gramercy to rebuild smaller nearby. The announcement, reported by the Times and Journal, isn't totally unexpected; the hospital, the city's largest private employer, has been operating at a significant loss for two years and was on course to rack up $2 billion in losses over the next ten years owing just to federal reimbursement structures.

Chatter of the hospital's fiscal woes came to the surface earlier this week when word leaked that the hospital would be selling a 24-story apartment building on East 17th Street and First Avenue that houses the hospital's medical residents.

Unlike the scores of downtown hospitals to shutter in recent years—St. Vincent's, razed for condos; Cabrini Medical Center, also condos—the hospital is not flatlining. According to the Times, a new, 70-bed facility on which construction will start next year will be built nearby. Once it's operating, the existing hospital will be sold with the proceeds working to offset its cost.

The new facility will also have an emergency department in a nearby building, and expanded outpatient facilities at three sites with operating and procedure rooms and physician practice locations.

"We have the macroeconomics of health care — which is that it is unaffordable for everyone," Dr. Kenneth L. Davis, president and chief executive of the Mount Sinai Health System, told the Times. Davis explained that with the cost of today's health care along with technical advances in the industry, maintaining large hospitals is no longer the most efficient model of delivering care.

"We are not diminishing, in any way, the services," Davis told the Journal, "We are not closing the doors."