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NORTH ADAMS -- With an anticipated loss of $2.5 million in revenues already projected for the coming fiscal year, North Adams Regional Hospital is changing the way it does business.

Changes to the hospital’s health care delivery model, which includes shifting inpatient psychiatric and pediatric care to outpatient programs, as well as the closure of its Critical Care Unit, is in response to declining patient volumes and revenues, according to Northern Berkshire Healthcare (NBH) officials.

"Our strategy is designed to make sure that NBH is here to care for the people of North Berkshire into the future," NBH President and CEO Timothy Jones said this week in a written release.

"The challenges facing us are significant, and we are acting today to preserve our local hospital. This will affect about 10 percent of our staff in some way, although we won’t know exact numbers until the process is complete," he said.

Northern Berkshire Healthcare has a total of 525 employees, 475 of which are employed at North Adams Regional Hospital (NARH).

Jones said the hospital has experienced a decline in patient volumes as services shift to outpatient models -- a drop of about 10 percent in one year. He added that so-called federal sequestration budget cuts reduced Medicare payments to NBH by approximately $200,000 in the current fiscal year -- an amount that is expected to reach $400,000 or more in fiscal 2014.


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Health care reform changes also are expected to negatively impact the organization’s bottom line.

"We’re designing services to meet the needs of our current volume of patients," said Jones.

"NBH, like all hospitals and care providers in the nation, will be subject to massive change as the federal Affordable Care Act takes effect and as models of care evolve. The NBH of the future will have to be quicker to adapt, more collaborative, and will look different than it does today," he said.

By early January the hospital will close its inpatient psychiatric services department, more commonly known as the Greylock Pavilion, shifting individual and group therapy, medication management and other psychiatric services to an outpatient service.

A psychiatric "pod" in the Emergency Department will provide crisis treatment and patients requiring admission will be transferred to Berkshire Medical Center or other facilities.

According to NARH spokesman Paul Hopkins, the shift in psychiatric services is the combined result of a decline in the number of patients and the financial burden of keeping the unit as is.

"Since the introduction of managed care, there has been a steady decline in the number of people admitted to inpatient psychiatric units. Our average daily census has dropped from 11 patients in 2008 to 7.1 patients in fiscal year 2013," Hopkins wrote in an email.

"Simultaneously, there is a significant need for outpatient services, with patients now waiting weeks for an appointment. Patients who have used Greylock may continue to use the outpatient service. However, if they require admission they will be transferred to Berkshire Medical Center or another facility," he said.

As part of the changes, the hospital’s Critical Care Unit (CCU) will close and the second-floor space will become the home of The Joint Replacement Center of Northern Berkshire, allowing the unit to have private rooms, a rehab gym, and a dining space for joint replacement patients.

"Critical patients are already being transferred to other hospitals directly from our Emergency Department," Hopkins said. "Most patients admitted to the CCU today are telemetry patients We will have one inpatient unit (all private rooms outfitted for telemetry, on the third floor) which will also admit patients who are now seen in CCU."

The changes are the outcome of a strategic plan approved by the NBH Board of Trustees. The plan also calls for NBH to develop partnerships with other care providers in the region, to structure NARH to meet community needs, and to invest in potential growth areas including surgical services, orthopedics, wound care, diabetes care, and healthy communities initiatives.

Key operational changes at NARH

*A new 16-bed inpatient unit will provide telemetry care that expands the capability to provide telemetry care.

*The hospital will open a dedicated space for its Joint Replacement Center.

* The hospital will focus on growing its surgical services and improving the patient experience in the Emergency Department.

*NARH will transition its inpatient psychiatric services department, Greylock Pavilion, to an outpatient program.

*Inpatient pediatric services will shift to an outpatient pediatric "observation" model.