No one thought it would happen to a teaching hospital that had served its region for more than 170 years. But, on June 26, 2019, the owner of Hahnemann University Hospital (HUH) in Philadelphia, an important provider of health care to a large underserved population, announced that the hospital was closing.1 HUH’s more than 550 residents and fellows (hereafter residents) would be displaced, or “orphaned,” and would need to seek positions at other teaching hospitals to continue their graduate medical education (GME). In addition, 12 trainees in a variety of disciplines, including pharmacy, dental medicine, and podiatry, would also need to find training opportunities elsewhere.
Many of the HUH residents had just moved to the Philadelphia area from across the United States or from other countries. The hospital had welcomed approximately 140 new residents less than 1 week before the closure was made public. As Philadelphia and the surrounding geographic region—including New Jersey, Delaware, and other cities in Pennsylvania—are fortunate to have a relatively large number of large- and medium-sized teaching hospitals with well-established GME programs in virtually every specialty and subspecialty, there were opportunities to relocate many of HUH’s trainees to other local hospitals.
Never before had such a large teaching hospital closed. Therefore, no one had experience, let alone expertise, in navigating the large number of stakeholders (for a list, see Supplemental Digital Appendix 1 at http://links.lww.com/ACADMED/A794) and the complex policies and procedures governing payment for GME by the Centers for Medicare and Medicaid Services (CMS) or accreditation of sponsoring institutions and their GME programs by the Accreditation Council for Graduate Medical Education (ACGME). In this Invited Commentary, the designated institutional officials (DIOs) of HUH and 4 other area teaching hospitals detail their experiences working to find new training opportunities for the displaced residents, sharing lessons learned and providing some recommendations to prepare for any future teaching hospital closures.
The HUH Closure: Experiences of Local DIOs
Following the announcement, GME leaders throughout the region, including program directors and the DIOs charged with institutional GME oversight, began working to understand the processes involved in transferring displaced residents and assessing what opportunities could be created to transfer residents from HUH to other local programs. (For DIO action items, see Supplemental Digital Appendix 2 at http://links.lww.com/ACADMED/A794). Each GME training program had an ACGME-approved complement limiting its number of trainees, so most hospitals would need to get expedited approval from the ACGME to obtain at least a temporary complement increase to accept transfers. The significant financial issues involved necessitated engaging other hospital executives, including chief executive officers, chief financial officers, chief medical officers, and experts in CMS reimbursement. It was also essential to ensure that, in helping the displaced HUH residents, the learning experience of residents already at other institutions would not be negatively impacted and that the training experience of any transferred residents would be similar to that of trainees in these programs. Were there enough patients, procedures, and teaching faculty? Was there enough clinic space?
Within a week of the announcement, the ACGME sent out a call for GME programs across the country to post in an ACGME database any potential training position openings for communication to HUH GME leaders and residents.2 Program directors and DIOs at other institutions submitted requests to the ACGME for complement increases so they could accept some of the HUH residents as transfers. For the most part, the ACGME Review Committees (RCs), which were responsible for deciding whether to approve complement increases, responded quickly; however, some RCs took several weeks, creating a very anxious situation for trainees in those programs (e.g., orthopedics).
Several teaching hospitals across the region set up their own websites to inform HUH leaders and residents of openings, and they began collecting residents’ names, programs of interest, years of training, contact information, etc. They held open houses to provide some reassurance to residents that local training opportunities might be available. Initially, it was unclear whether programs could even set up interviews with the HUH residents as the residents were still under contract and not yet orphaned. The rules of engagement were unknown.
Meanwhile, residents were receiving mixed messages from HUH and their program leaders about what to do, because answers to their questions were just not known. Could they interview? Would CMS funding follow them? Would their program and all of its trainees be transferred en bloc? What were their rights to choose where to transfer? Would their training after transferring be off cycle?
HUH residents experienced what finding positions was like before the current process of matching to residency programs through the National Resident Matching Program (NRMP). Some residents were given very short time frames by other programs to make decisions about positions offered to them, increasing their anxiety. Some DIOs were initially told that they would need to get NRMP waivers in order to accept HUH residents in transfer. Some residents were told that their program was being transferred from HUH, a large urban academic medical center, to a community hospital outside the immediate Philadelphia area before it was made clear that that the residents had choice in this matter.
Throughout the process, DIOs in the region did not really know what they could and could not do and what their colleagues at other institutions were doing. The lack of clear, consistent information made developing and implementing a coordinated regional approach to finding new training positions for the HUH residents virtually impossible. It was not until mid-July that the Association of American Medical Colleges (AAMC) began to send out communications about NRMP waivers and CMS funding regulations.3 Yet even by mid-July, no one knew when HUH residents would be allowed to transfer and how they would be onboarded. In addition, there was great uncertainty and concern about CMS GME funding.
The ACGME held its first teleconference with local DIOs on July 24, which was around the same time that HUH announced its plan (later changed) for the timing of the release of its residents from their training programs and of official program closures, a necessity for transferring CMS funding. During this call, the ACGME also announced that it was accepting applications for new training programs, which came as a surprise since previous communications had indicated no new program requests would be considered.
Finally, HUH released its residents in 2 groups, some on July 29 and the others on August 6, even though few patients remained in the hospital after July 10, which limited the educational experiences for at least some residents during this time.
Perspective from the HUH DIO
With the announcement on June 26, 2019, of what was to be the largest “orphaning” of residents in GME history, the HUH DIO (W.C.B.) focused on transferring as many residents as possible. HUH program directors and residents were informed separately, with hopes of heading off unfounded rumors, and each group was provided information related to the next steps as this crisis unfolded.
The partnership between HUH’s owner and Drexel University College of Medicine was complicated. HUH was the sponsoring institution for the hospital’s ACGME-accredited and other training programs, with Drexel as the academic partner. The residents and DIO were employed by HUH, yet the majority of the faculty were employed by Drexel—and desperate not to lose their opportunities to teach and take care of patients with residents. With the hospital ownership separate from the medical school that employed the faculty, interests were not at all aligned.
Because of the legal situation with the HUH bankruptcy, the flow of information was very closely monitored and limited. This constrained the HUH DIO in ways that were not apparent to the external GME community, hampering his ability to provide transparent and timely information to the HUH residents and program leaders as well as to the external GME community. Despite pleading to be permitted to alert the ACGME and other entities that a bankruptcy announcement was imminent, the HUH DIO was prohibited from formally notifying the ACGME until June 28, 2019. He was initially permitted to communicate with CMS; however, that was later prohibited, even to ask basic regulatory questions, without prior review and approval by HUH attorneys.
The HUH owner and legal team had little to no prior experience operating a large academic medical center, especially one with a complicated master affiliation agreement with a separate medical school. Drexel was reportedly making efforts to reconstitute entire residency programs at another institution with which the medical school partnered, while the HUH DIO was pushing for resident choice. The information and advice provided by Drexel leaders to program directors and residents was often at odds with what was coming from HUH leadership—and with what the DIO felt was in the best interest of the residents. As noted in the public bankruptcy records, the HUH owner’s goal was to turn CMS revenue tied to its residency slots into a saleable commodity.
During this period, the HUH GME Office was staffed for its usual day-to-day work—with the DIO, a GME specialist, and a GME finance specialist—not for a critical situation with so many lives, and so much money, in the balance. The DIO was fielding more than 50 calls and 100 emails daily from institutions across the country and regulatory agencies, as well as being inundated with meeting requests from HUH program directors and residents. The GME finance specialist was tasked with creating the GME Resident Displacement Agreements required by CMS. The GME specialist assisted with transfer documents and training verifications, and also fielded resident questions.
Although the HUH DIO considered it to be a priority to place as many residents in Philadelphia and the surrounding geographic region as possible, to mitigate the financial impact and educational disruption for residents, many residents viewed the closure as an opportunity to seek positions closer to home or in a program they preferred but did not match into through the NRMP process. Once an agreement (verbal or written) was reached between a resident and a receiving hospital, the HUH GME Office was notified and began to work on the GME Resident Displacement Agreement, often with inaccurate or incomplete information (e.g., the name of the university affiliated with a teaching hospital rather than the actual receiving hospital). This hampered creation and execution of these essential agreements and delayed the release of the residents. Essentially, the residents were in limbo until this could be resolved.
Regulatory and accreditation organizations
It was not until July 12, 2019—16 days after the closing announcement was made—that the ACGME sent a contingent of 11 senior staffers to HUH. It was publicly known at this time that many clinical services had markedly dwindled or ceased operations completely. Surgeries were being canceled, the emergency department was winding down, and the residents had little or nothing to do. Learning, a primary function of GME, was slowly grinding to a halt for many of the residents who were not able to find outside rotations at other local hospitals during this period.
The ACGME team appeared to be very concerned about what was happening at HUH and the deteriorating educational environment but elected to take no accreditation-related action, such as withdrawal of institutional or individual program accreditation. This was in part due to concerns about the difficulty of timely placement of residents elsewhere and the impact on CMS funding. ACGME staff repeatedly made clear that the ACGME was an accrediting body, and as such they were not able to provide information or assistance in answering the many questions that arose related to CMS funding policies in the face of closure of a training program or possible loss of accreditation by a sponsoring institution. There appeared to be little preparedness for the events that unfolded at HUH. The last large teaching hospital closure in the United States occurred in 2010 under very different circumstances.4
Engaging CMS proved to be difficult, and the information that was made available was often unclear and even contradictory.5 Many of the CMS regulations governing funding of displaced residents are complicated and burdensome; this, coupled with regulatory inflexibility, made management of this situation fraught with uncertainty and created worry about financial risk for institutions willing to accept transferred residents. The reporting burdens mandated by CMS policies for those that did accept residents will remain substantial for the duration of their training at their new institutions.
The NRMP staff was very helpful, stating clearly that Match waivers would be provided and offering to expedite all such waivers. The Educational Commission for Foreign Medical Graduates (ECFMG) staff was also very helpful, assisting the HUH DIO with oversight of the transfers of the 59 trainees who were J-1 visa holders and would, by law, risk deportation if there were any gaps in their training.
Lessons Learned and Looking to the Future
Unfortunately, HUH will likely not be the last large teaching hospital that closes in the United States. It is important that the GME community learns from what happened at HUH so everyone will be better prepared when this happens again. List 1 presents recommendations for action items to improve the relocation of residents in future closings, based on our lessons learned.
Recommended Action Items to Improve Relocation of Residents Displaced in Future Teaching Hospital Closures
- Improve alignment of CMS and ACGME policies regarding closure of programs and teaching hospitals and release of CMS funding linked to individual trainees
- Increase communication to sponsoring institutions, program directors, and residents regarding the rights and responsibilities of residents when seeking new training positions if displaced
- Establish procedures and policies allowing the ACGME or the AAMC to serve as a primary source of information, collaboration, and implementation of plans for resident relocation
- Ensure expedited decisions by ACGME Review Committees regarding temporary complement increases
- Establish clear guidelines as to whether, and under what circumstances, hospitals can submit applications to the ACGME for accreditation of new programs
- Set policies in advance regarding granting of automatic NRMP Match waivers
- Explore a special NRMP-sponsored Match to relocate displaced residents
- Anticipate and address potential lapses in medical professional liability coverage, require training institutions to provide “tail” coverage for any displaced residents, and consider creation of a national insurance “pool” to provide such coverage if necessary
Abbreviations: CMS, Centers for Medicare and Medicaid Services; ACGME, Accreditation Council for Graduate Medical Education; AAMC, Association of American Medical Colleges; NRMP, National Resident Matching Program.
Residents, program directors, and DIOs turned first to the ACGME, as the GME-accrediting organization, for guidance. The ACGME’s role, initially, was limited to providing a resource for programs to list positions available for the soon-to-be-displaced residents. Only later did the ACGME offer some informational telephone calls for DIOs; however, the ACGME staff was still unable to answer many important questions. To prepare for future closures, we suggest creating easily accessible resources on the ACGME website and the websites of other relevant organizations that clearly define residents’ rights and provide guidance for them, their program directors, and DIOs about how to proceed under these circumstances.
The NRMP might consider holding a separate Match to assist displaced residents in finding new programs. The CMS needs to clearly define its policies and procedures. Hopefully, experience with this large hospital closure will lead the CMS to reconsider its requirements around limiting geographic redistribution and its processes for ensuring that funding follows trainees without the stipulations that currently exist regarding program or hospital closures. Following HUH’s closure, its CMS-funded GME slots were “sold” through a bankruptcy court auction for $55 million, a move that is being contested by the CMS and others. The outcome of this litigation is likely to affect future resident relocations.
Several months after the HUH residents had settled into their new training programs, it became known that HUH’s owner was not providing professional liability “tail” insurance coverage beyond January 11, 2020, for the displaced residents, potentially leaving them at personal financial risk for the purchase of individual coverage (costing thousands of dollars) or for claims made during any lapse in coverage, as well as susceptible for loss of state licensure and hospital privileges where such insurance is required. Some of the institutions that accepted HUH residents will likely end up paying the substantial (and unanticipated) costs for this insurance coverage.
In the end, all of the orphaned HUH trainees were placed into new training programs within 43 days. For residents, these were weeks of anxiety and uncertainty. For program directors and DIOs, these were weeks consumed by doing what they could to assist as many of the displaced residents as possible, amidst tremendous uncertainty in a high-stakes situation. We implore the ACGME, CMS, NRMP, ECFMG, and AAMC to work together to write a “playbook” for next time to avoid the chaos the residents and GME community experienced this time.
The authors gratefully acknowledge the incredible work of the many program directors, program coordinators, GME office staff members, hospital leaders, and others who devoted their time and effort to assist in the placement of the Hahnemann University Hospital residents, fellows, and other trainees into new training programs.