The Economics Of Hospital Beds : Planet Money Bellevue, the oldest public hospital in the nation, has seen everything and survived everything. But even they might not have enough beds. Here's why. | Subscribe to our weekly newsletter here.

The Economics Of Hospital Beds

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DANIELLE OFRI: Do you want to hang out over here maybe?



Last week, I went to a New York City park, also known as a slab of concrete with three benches surrounded by high-rises, to meet up with Dr. Danielle Ofri on her lunch break. The park is directly across the street from where she works at Bellevue Hospital.

How long have you worked here?

OFRI: At Bellevue?


OFRI: Oh, my gosh. So I was a medical student here. I did my internship and residency. And I've been an attending since 1998.

ARONCZYK: So a long time. But usually, she's working inside the Bellevue building. And today, she's in a tent outside on the lawn just in front of the hospital complex. And she's testing patients who might have COVID-19, which is a sign that Bellevue is already having to make tough decisions about scarce resources.

Another downside of a tent - it's been really cold out. Danielle's been in there, working and shivering.

OFRI: Yeah. And we have to have the sides of the tent are open.

ARONCZYK: Oh, no. And do you bring, like, a hat and gloves and things?

OFRI: I wore leggings, two pairs of pajamas, sweatpants, three shirts. The problem is you can't wear gloves under your gloves, so my hands are freezing.

ARONCZYK: Today happens to, thankfully, be a little bit warmer, so she's just got on her doctor's white coat - no pajamas. She's also got on a mask. She spent the morning in the tent assessing patients. And then in the afternoon when she goes back in, she'll be on swabbing.

How many people come through the tent a day now?

OFRI: It is completely variable. So it hasn't been too overwhelming. But, yeah, we've seen at Elmhurst and Queens Hospital lines down the block. So it certainly could be - any moment.

ARONCZYK: Elmhurst and Queens Hospital are two other public New York City hospitals. They've been in the news a lot lately because they are swamped with sick patients. And as some of those hospitals are filling up, they're starting to transfer their sick patients to Bellevue.

OFRI: Last night was the first night I really could not sleep and kind of woke up at 4 in the morning thinking, I feel like things are turning. I mean, each day is like a - just a new chapter.


ARONCZYK: Hello, and welcome to PLANET MONEY. I'm Amanda Aronczyk.


And I'm Robert Smith. The economic story of the coronavirus pandemic has been one of scarcity - not enough medical personnel, ventilators, masks, even hospital beds. And as we're seeing this all play out, there's been this question that keeps popping up. What are hospitals thinking? Why do they not have enough supplies? I know this was unexpected, but how do hospitals decide how much stuff to keep around, just in case?

ARONCZYK: Today on the show, we look at one hospital here in New York City, Bellevue Hospital, the oldest public hospital in the country. In the hospital world, it's like a grizzled veteran - seen everything, survived everything. It has been there for every outbreak from yellow fever to Ebola. And if you are in New York and you catch something weird, new and scary, you go to Bellevue.

SMITH: And yet, even Bellevue may not have enough beds for a crisis like this. No hospital does. And that was a decision, a policy decision from back before anyone had heard the name COVID. Today, we will look into that logic, the logic of hospital beds, how many there are and why.

ARONCZYK: And we'll show you how Bellevue is scrambling to rearrange their hospital quickly.


ARONCZYK: The official name of the hospital is New York City Health + Hospitals/Bellevue, but everyone just calls it Bellevue. And you've probably seen it before on TV or in the movies, even if you've never actually seen it in real life.

DAVID OSHINSKY: It was in "The Godfather," "Miracle On 34th Street." There's virtually no "Law & Order" episode in which someone isn't sent to Bellevue.

ARONCZYK: It's true (laughter).

OSHINSKY: You know, when a cop is shot, when a firefighter is overcome with smoke, when a construction worker is hurt, it's Bellevue. That's where you go. You're taken to Bellevue.

ARONCZYK: David Oshinsky wrote a history of Bellevue. He's also a professor of medicine at NYU Langone Health.

OSHINSKY: If you look at Bellevue today, it's just a huge sort of warren of big, old brick buildings, many of whom date back to the 19th and some into the 20th century.

SMITH: The original building facade is still there, but now it's wrapped in this giant glass rectangle, and the whole thing sits on the East River of New York.

ARONCZYK: The most extraordinary thing about Bellevue is its mission. It's always prided itself on being a hospital that never turns anyone away. Don't have insurance? That's fine. Undocumented? Come on in. Homeless? You are welcome at Bellevue. They will always find room.

SMITH: Even through the absolutely worst times.

OSHINSKY: We had yellow fever in the 1790s. We had a series of really awful cholera outbreaks between the 1830s and '50s.

ARONCZYK: David's the kind of person who takes comfort in history. He's got a don't worry, we have been through hard times before kind of attitude. So if you are at all like him, then maybe you'll take comfort in this long list of maladies.

OSHINSKY: We've had typhus outbreaks. It was there for polio. And particularly, during the 1918 great influenza pandemic that killed 50 million people worldwide, Bellevue was sort of the center in New York City.

ARONCZYK: You've probably heard a lot about the influenza pandemic of 1918 over the last few weeks. There are a lot of similarities to what's going on right now with this coronavirus.

SMITH: I know I've read everything I possibly can about it just to - I don't know. It somehow calms me. The disease at the time, like, it spread quickly. It led to a massive program of quarantines around the country and in New York City.

ARONCZYK: Businesses staggered their hours so the trains would be less crowded. The theaters stayed open - the city wanted people to have, like, a little bit of joy - but everybody had to sit in every other seat in the theater. The Health Department banned spitting in public and what they described as promiscuous coughing and sneezing.

SMITH: It was also one of the very few times when Bellevue hospital ran out of real beds.

OSHINSKY: Patients were actually sleeping on straw in the halls. They were taking doors and pulling them off the hinges, and patients were sleeping on them.

ARONCZYK: But even then, they lived up to their mission of serving everyone, even if the sleeping quarters were itchy.

SMITH: And now today, with the coronavirus, Bellevue might need to bust out the modern version of straw bales and doors because here is a disturbing fact. There are fewer hospital beds at Bellevue today than there were in 1918 - than there were during the influenza.

ARONCZYK: Which is kind of stunning. There were only a hundred million people in the U.S. in 1918. Now there are three times as many. New York has gotten bigger, too.

SMITH: Now, before you go and blame New York politics or the funding of public hospitals, which is a big issue, in this particular case, Bellevue is not an outlier. The United States of America, the entire country, has fewer hospitals and fewer beds than it did 50 years ago.

ARONCZYK: This seems confusing, so I called up Zack Cooper. He's an associate professor at Yale's School of Public Health. And also, he teaches in the Department of Economics. And I asked him about this mystery. And he said, don't be alarmed. It's actually a sign of medical progress.

ZACK COOPER: So I think we've gotten better at doing things in shorter amounts of time, and so that's basically led to a decrease in the number of beds that are necessary. If you think about knee arthroscopies or, in some cases, even joint replacements, where folks are going home the day of their surgery, well, in some ways, that's not a bad thing 'cause then we're not paying for another night in the hospital. And so the sort of idea is you take the capacity out as we get more efficient delivering these procedures.

SMITH: Having hospitals filled to capacity with people spending weeks at a time there is not ideal. Get them fixed. Get them out. Makes sense. Plus, there's outpatient clinics, doctors' offices, urgent care centers. They are doing procedures that used to take place in a hospital.

ARONCZYK: But Zack also says there is a second reason, which is maybe a little less obvious, about why there are fewer hospital beds. And here is where Zack's economist soul really shows itself.

COOPER: You know, if you'd interviewed me eight months ago, I would've said, look; we probably need fewer hospitals in the U.S. I actually still think that today.

ARONCZYK: Fewer hospitals.

COOPER: I don't plan on getting on top of the building and screaming that 'cause it wouldn't make me wildly popular.

SMITH: But we convinced Zack to tell us the unpopular reason that he thinks we should have even fewer hospital beds.

COOPER: If there are beds - right? - if there is supply, those beds would've gotten used.

ARONCZYK: But isn't it - if the beds got used, doesn't that mean somebody needs to be in a bed?

COOPER: Not necessarily. I, as a patient who's not a doctor, really rely on a medical doctor to inform me about when I need care. And I think if there's spare capacity, there is actually the chance that that spare capacity gets used, and it gets used inefficiently. And then ultimately, we, as the public, pick up the bill for that.

ARONCZYK: Zack isn't way off here. In fact, he's talking about a phenomenon that is so well known it's in economic textbooks, Roemer's Law of hospital beds.

SMITH: Professor Milton Roemer, UCLA, died in 2001, author of "National Health Systems Of The World" - two volumes.

ARONCZYK: Roemer's Law builds on the theory of induced demand - that if you build a road, that more people will end up driving on it because it's there. And so in health care, if you have a hospital bed, doctors will put a patient in that bed because it's there.

That's interesting. It makes me think of a few things. One thing is, like, when I had my kids, I was in the hospital for whatever it was - you know, 30 hours. And then it's like, well, thank you very much, ma'am; you're going to have to pack up your bags and get out of here, when it would've been really nice to stay an extra 24 hours. So sometimes it feels like that's - it's so lean that it wasn't really about my well-being. It was really, like, about the bottom line.

COOPER: Well, I think the question is, like, in the case of your baby delivery, who's going to pay for that excess bed? Is that efficient? And, you know, I think one of the perennial challenges in health care is, in a sense, like, individuals are to some extent insulated from the costs because those are captured by insurance.

ARONCZYK: The argument that he's making that we need fewer hospitals, not more, is not some fringe idea. A lot of states have passed laws to limit the construction of new facilities. They have boards that issue certificates of need. You have to prove that the beds that you're putting in are crucial. They aren't just going to be profit centers where people with sprained ankles lie in bed and rack up the bills.

SMITH: And whether or not you think this is a good idea, the reduction in hospital beds is a reality. And now that reality is going to slam up against what might be its biggest test yet, the coronavirus, especially if you're a hospital like Bellevue with both fewer beds and a mission to serve everyone who walks through the door. Zack says that when a hospital cuts beds, at the same time, it also needs to make an emergency plan.

COOPER: You need to have some forethought to say, look; at some point, we're probably going to have a pandemic. They seem to happen once every hundred years. Given that we're taking beds down, what's our plan to scale up?

SMITH: And this is where the current crisis comes in. Given that the economic decision was already made to have fewer beds, what is the plan to scale up?

ARONCZYK: And it seems like everyone is improvising. One thing we are seeing, at least here in New York, is a huge influx of temporary beds.

SMITH: In the span of just a couple of weeks, the Army Corps of Engineers has built 2,500 beds in New York's convention center. Just for comparison, that's more than twice the number of Bellevue's beds. And as we record this, the site of the U.S. Open out in Queens, the tennis center, is also being converted into a 350-bed hospital.

ARONCZYK: There's another new makeshift tent hospital in Central Park with 68 beds.

SMITH: And perhaps you saw on TV the most impressive of New York City's backup plans, (imitating foghorn). That was me. Sorry. We don't have tape of it.

ARONCZYK: (Laughter).

SMITH: The Navy Ship Comfort - 1,000 floating beds now parked at New York's Pier 90.

ARONCZYK: Which brings us back to Bellevue Hospital, star of "Law & Order," historic fighter of disease. If they want to keep up their tradition of never turning a patient away, they'll have to get creative. That's coming up after the break.

SMITH: The emergency department at Bellevue Hospital sits right at the center of this sprawling hospital complex. I have been there back in better times. Once you are past the fancy new atrium lobby, the ER feels a little claustrophobic and depressing. There are fluorescent lights, beige walls, curtains, beds and equipment sort of stuffed into every corner.

ARONCZYK: Now, we couldn't see it today, but we were able to call up a nurse at Bellevue. We caught her just before her shift started running nursing in the emergency department.

MIA SCARAMUZZINO: So my name is Maria Scaramuzzino. They call me Mia. So, you know, I'm a nurse, like, 36 years now.

ARONCZYK: Oh, no kidding.


ARONCZYK: That's a long time.


ARONCZYK: (Laughter) I don't mean that as an insult.

She says that since the night the first COVID patient came in, she's been basically working seven days a week. She just goes home to sleep.

SCARAMUZZINO: It was just so fast that, really, from that night to now, I can't - you know, it's all a blur.

ARONCZYK: Mia oversees about a hundred nurses and assistant staff at Bellevue Hospital, and she's directed emergency nursing for 17 years. So, you know, this is not her first national crisis.

SCARAMUZZINO: We had to get ready for 9/11, of course. Then it became anthrax, SARS, MERS, Ebola and now COVID. And, actually, I even remember in the early '80s when HIV first came about, it was almost the same type of response. We were all gowned up, suited up in full personal protective equipment because at that point we didn't even know what we were dealing with.

ARONCZYK: Back in 2014, the hospital treated one of four cases of Ebola in the United States, a truly deadly virus that required tons of logistics. And ever since, the hospital has had a special pathogens unit, which is basically a team that trains staff and prepares for things like a new coronavirus. So this hospital does have an emergency plan to scale up.

SCARAMUZZINO: You know, the first thing that we did, which was, like, the greatest, was to change up the emergency department. We converted that into the respiratory unit. So anybody coming in with COVID-like symptoms, if they needed to be seen in the emergency room, they were immediately put into that area.

ARONCZYK: They set up the hospital to keep people with the coronavirus away from the rest of the patients, emergency department for the people who came in really sick and the tent outside for testing people with mild symptoms.

SMITH: OK. So once they had the organization set up, they had to find more square footage, literally more space to put people in.

SCARAMUZZINO: So we have stopped elective procedures, like colonoscopies, endoscopies, et cetera. So...

ARONCZYK: OK. So these are, like, surgeries that people come in for...


ARONCZYK: ...That are not 100% crucial right now.

SCARAMUZZINO: At this point, yes.

ARONCZYK: Bellevue has been rearranging the hospital for weeks, opening old wards, turning offices into hospital rooms, adding more beds. And if they need to, they'll add more beds even in the operating rooms.

SMITH: This is all part of the plan. The next thing they needed, though, was people to staff all these new rooms.

ARONCZYK: There's a photo of a group of health care workers coming from Georgia. And they're all making heart signs with their hands. There are people flying in from all over to help out with New York City hospitals.

SCARAMUZZINO: I've probably gotten close to maybe a hundred, soon to be about 150 of nurses that are coming from all over the United States to help us with the COVID pandemic. So...


SCARAMUZZINO: We've gotten a lot of nurses to come here and help us, especially in the most crucial areas, which are now really ICU and emergency department.

ARONCZYK: All of these nurses show up. They get certified, fitted for protective gear. And then they are deployed.

SMITH: Because they've been making more room, and because Bellevue seems to exude a sense of calmness, really, that you can hear in Mia's voice, they are now taking patients from other hospitals that are overwhelmed.

SCARAMUZZINO: We're trying to help our sister facilities that have been hit harder.

ARONCZYK: Are they starting to send patients to you guys?


ARONCZYK: Wow. So it's really - there's a lot of complicated logistics going on.

SCARAMUZZINO: (Coughing) Yes. (Coughing) So...


SCARAMUZZINO: Yeah, yeah. That's just, like, dry throat. You can't even cough anymore, Amanda, without people looking at you.





ARONCZYK: But it is when people - I've been talking to a number of people, and every time they cough, I'm like, oh. I mean, and you're a nurse, so that's even more worrying.

SCARAMUZZINO: I know. I know. I know.

ARONCZYK: As of today, Mia says she is feeling fine. And she is feeling confident as well. So far, Bellevue has enough hospital beds for everyone who needs one.

SMITH: So far. One of the strange and unnerving things about living in New York City these days is that even if you aren't near a hospital, you can hear beds around the city getting filled up.


ARONCZYK: While I was doing my interviews in front of Bellevue, I stood in that little concrete park and looked across the street. And I could see the tent in front of Bellevue and one ambulance after another going by, headed for the ER.


SMITH: An update now - we've been doing a lot of shows about the pandemic, and it is still hard to keep on top of everything. As we were finishing this show, we heard the news that 6 million more people filed for unemployment. That's twice as many as last week, when we put out a show to mark what seemed like an unbreakable, inconceivable record. The scale of this crisis is growing worse every week. For more on the numbers, check out our sibling podcast The Indicator, which posts every day.

ARONCZYK: You can email us at Or on Facebook, Twitter and Instagram, we are @planetmoney. Thanks to Dr. Ram Raju at Northwell Health, to Evelyn Hernandez and Justin Chin at New York City Health + Hospitals/Bellevue.

SMITH: Today's show was produced by Darian Woods and Liza Yeager. Alex Goldmark is our supervising producer. And Bryant Urstadt edits the show. James Sneed - he fact-checked the show. Talk to him.

ARONCZYK: If you liked this episode, please share it with a friend. I'm Amanda Aronczyk.

SMITH: And I'm Robert Smith. This is NPR. Thanks for listening.


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