Business

Carney Hospital on verge of turning financial corner

Increase in patients improves outlook at Carney, known for serving low-income population

Walter J. Ramos is the third president to lead Carney in four years.
Suzanne Kreiter/Globe Staff
Walter J. Ramos is the third president to lead Carney in four years.

Carney Hospital, the longtime money loser that serves thousands of low-income residents in and around Dorchester, is on the verge of breaking even for the first time in five years.

The number of patients admitted to the 159-bed hospital, owned by the for-profit Steward Health Care System, climbed nearly 16 percent in the first half of this year, compared to the same period in 2014, according to Steward. Outpatient surgeries jumped 21 percent, and emergency room visits increased 12 percent.

The rising patient numbers signal that the long-struggling hospital may finally be in the midst of a turnaround.

Advertisement

Carney’s growth has been aided by last year’s shutdown of another struggling Steward hospital, Quincy Medical Center. Steward executives say they have recruited 100 new doctors at Carney in the past year, including many who used to work in Quincy. In all, about 125 Quincy employees transferred to neighboring Carney, and many patients followed them.

Get Talking Points in your inbox:
An afternoon recap of the day’s most important business news, delivered weekdays.
Thank you for signing up! Sign up for more newsletters here

After losing about $9 million in 2014 and 2013, Carney expects to break even by the end of the year, said Walter J. Ramos, who became the hospital’s president in May.

“The landscape has changed,” Ramos said. “This is really Carney’s moment.”

Carney’s financial problems began long before Steward bought it and five other hospitals from the Archdiocese of Boston in 2010. The archdiocese threatened to close Carney in 2007 amid ongoing financial losses.

Located in one of Boston’s most diverse neighborhoods, Carney serves a disproportionately poor and senior population. About 77 percent of its patients are on the government programs Medicare or Medicaid — a far higher share than at a typical hospital. This means Carney relies heavily on government reimbursements, which health care industry executives say don’t cover the full cost of care.

Advertisement

Hospitals such as Carney that serve large numbers of the poor and elderly “are being paid at a rate that is far below their commercial competitors,” said Steve Walsh, executive director of the Massachusetts Council of Community Hospitals. The council does not include Steward hospitals. “It is a very difficult environment in which to survive.”

Steward said it has spent about $25 million to upgrade Carney’s 12-acre campus on Dorchester Avenue. It refurbished Carney’s family medicine department, opening 26 new exam rooms this year and promising to give patients a primary care appointment within 24 hours. The hospital, affiliated with Tufts University’s medical school, also offers more specialized services such as cancer care and vascular surgery.

Carney staffers like Narkeya Washington, a patient access lead who helps patients with registration and insurance issues, have noticed the uptick in volume.

“There has been a lot of changes,” said Washington, who has worked at Carney for 11 years. “It’s a lot of patients now. We’re pretty much busy for eight hours. Sometimes it can be a little overwhelming.”

Ramos, 53, is the third president to lead Carney in four years. He replaced Andy Davis, who had led Carney since 2012. Davis followed former chief executive Bill Walczak, who left after about a year leading the hospital.

Advertisement

Ramos’s career includes stints at Boston Medical Center’s HealthNet Plan, for people with low incomes, and the Massachusetts Hospital Association, a trade group. Most recently, he was chief executive of DotHouse Health, a community health center in Dorchester.

At a time of increased competition in the hospital industry, Ramos said he’s asking Carney’s 1,000 workers to focus on patient satisfaction. That means providing quality medical care and making sure the building is clean, parking is sufficient, and patients can navigate the hospital even if they don’t speak English. Some hallway signs, for example, are printed in Spanish, Haitian Creole, and Vietnamese.

Under Ramos’s leadership, Carney executives hold a “huddle” with department heads every morning, ticking off what went well the day before, and what didn’t. The morning meetings are one way Ramos said he is learning about the hospital and determining where to focus his effort.

State Representative Daniel R. Cullinane, a Dorchester Democrat, said he is optimistic Ramos’s experience in community health care will be an asset to Carney. But he said public officials must monitor Carney’s progress and make sure its private-equity backed owners continue to invest in it.

“There will always be a healthy skepticism about how the people-versus-profits dynamic works with a for-profit health care management company providing care for a patient population of those most in need,” Cullinane said. “Steward’s commitments are something that will need to be proved over time.”

Priyanka Dayal McCluskey can be
reached at priyanka.mccluskey
@globe.com
. Follow her on Twitter @priyanka_dayal.