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Panel left eastern Niagara hospitals in good health Merger is old hat for Newfane, Lockport Memorial

LOCKPORT -- While the report of the state commission on the future of hospitals and nursing homes brought fiery denunciations in many Western New York communities, the news was good for Lockport and Newfane.

Their hospitals will remain intact, with the only change being the recommendation of a formal merger. Since Lockport Memorial Hospital and Newfane Inter-Community Memorial Hospital have had the same management for the past seven years, it's really no big deal.

"We're going to look at how a full asset merger would give us opportunities to add services," said Clare A. Haar, administrator of both hospitals.

In fact, the Eastern Niagara Health System, the parent board of both hospitals, last month kicked off a $1 million fund drive to purchase computer equipment needed to store X-rays and other radiological test results.

Community leaders were a little nervous leading up to the Nov. 28 announcement of the state commission's recommendations.

"You're always concerned when something like that happens that you can't control," Lockport Mayor Michael W. Tucker said. "It's an important part of our community."

Newfane Supervisor Timothy R. Horanburg said, "We spoke at the public hearing [the commission] held, and I think that went a long way. Newfane and Lockport have shown the state they can work together and turn things around and make money."

Lockport Memorial is licensed for 134 beds but actually offers only 102. Its occupancy rate through the first 10 months of this year was 71 percent.

In Newfane, Inter-Community has a 71-bed license but actually offers only 51. In the first 10 months of the year, it had a 70 percent occupancy rate.

Both hospitals offer maternity units and adult acute care. Lockport Memorial also offers a 20-bed chemical dependency inpatient unit.

In addition, both hospitals have off-site facilities. In Lockport, there is an ambulatory care center on South Transit Road and an imaging center on Professional Parkway. Inter-Community offers the Founders Health Center in Wrights Corners, aimed at service to the uninsured, those without a primary care physician and migrant farm workers.

The Lockport-Newfane affiliation came in 1999, after Lockport Memorial flirted with bankruptcy and had an unpleasant experience with out-of-town commercial management. The affiliation hasn't always been a bed of roses -- there was a bitter 35-day nurses' strike at Lockport in 2001 -- but the long-term financial results have been good.

Both hospitals were in the black in 2005, and Newfane has almost always come out on the plus side of the ledger. Last year, Lockport Memorial had an operating surplus of $98,048 on nondonation revenue of $35.8 million. Inter-Community was in the black by $70,102 on nondonation revenue of $20 million.

The Newfane management steadied Lockport's shaky finances and helped move the hospital into positive numbers. The facilities are both major local employers: Lockport Memorial has 450 workers, and Inter-Community has 325.

Eastern Niagara Health System also owns a nursing home -- Newfane Rehabilitation and Health Care Center -- and Niagara Home Care, an in-home service.

Haar said the parent board has representatives from both hospitals' boards. She said that with a merger, there would be one joint hospital board reporting to the parent board.

"It's over time that the benefit comes as we streamline our governance," Haar said.

Horanburg said, "I'm just glad that we missed this bullet." He added with some concern, "I just think we'll be doing this again in a couple of years."

For now, at least, the commission was impressed. Its report said, "Despite their close proximity [about 10 miles apart], neither facility should close. Eastern Niagara County is rural and lacks public transportation. Travel to both facilities is difficult, due partly to each hospital's dependence on a volunteer emergency medical system [outside the City of Lockport]. In addition, the two-hospital structure helps attract physicians to serve a community in which parts are designated as medically underserved."

In fact, Haar said, Lockport is able to offer bariatric, or stomach-stapling, surgery, a fairly exotic specialty for such a small hospital.

The $1 million fundraising effort for the picture archiving and communications system, or PACS, will improve doctors' access to results of X-rays, CT scans, ultrasound, mammography and nuclear medicine test results.

Haar said the system will make it possible for doctors to view the results at their offices or at various locations in the hospitals.

"Essentially, it's a filmless radiographic system. You're not using film, which is a very expensive cost," she said.

The new system is motivated by a desire to upgrade technology. Haar said it's not necessarily a cost-saver. "Over five years, we may break even," she said.

The fund drive included letters mailed to thousands of homes last month. It's the second year of a direct capital campaign for the hospitals. Last year, Lockport raised about $40,000 and Inter-Community $80,000.


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