The Spreadsheet Decision
What closed, and who closed it
In the past twelve months, pediatric intensive care units closed in Montana, Oregon, and the Kansas City region, and general pediatric wings shut in Illinois and California. For-profit, nonprofit, and academic owners alike. Click any card for the hospital’s own stated reason.
Community Medical Center, Missoula, MT
University of Kansas Health System, Kansas City, KS
St. Vincent Medical Center, Portland, OR
Saint Joseph Medical Center, Joliet, IL
Santa Rosa Memorial, Santa Rosa, CA
Los Robles Regional, Thousand Oaks, CA
Connecticut Children’s at St. Mary’s, Waterbury, CT
The arithmetic of closure
Four peer-reviewed studies from Lurie Children’s, Children’s Hospital Los Angeles, and Children’s Hospital Colorado track pediatric capacity across two decades of American Hospital Association data. The pattern is steady, not episodic.
Pediatric vs. adult capacity, 2008 to 2022
Units: 1,749 to 1,226 pediatric; 4,519 to 4,318 adult. Beds: 31,133 to 25,064 pediatric; 405,908 to 393,802 adult. Pre-pandemic, pediatric units fell 2.2 percent a year against 0.4 percent for adults. Source: Bucholz, Cushing, Michelson et al., JAMA Pediatrics, 2025.
Share of pediatric units that closed, by geography
“More than half of rural units actually closed over a fifteen-year period.” Kenneth Michelson, MD. Nearly one in four U.S. children experienced an increase in distance to the nearest pediatric inpatient unit between 2008 and 2018.
The capability cascade, 2003 to 2022
When the PICU goes, the pediatric surgeon and pediatric-trained nurses who justified it tend to go too, and routine care follows them. Hospitals at the lowest pediatric capability level rose from 26.7 percent to 65.0 percent of all hospitals. Share of hospitals that:
Seventeen of 24 measured pediatric capabilities were available at fewer hospitals in 2022 than in 2003. Source: Michelson et al., Pediatrics, January 2026.
Why the spreadsheet always says close
Hospitals cite three reasons in the same order: too few patients, too few clinicians, too little money. Each is accurate. The investigative question is why all three point the same way at the same time.
Low, and getting lower, for good reasons
Fewer children need hospital beds than a generation ago. The birth rate has declined, vaccines eliminated most hospitalizations for once-common diseases, and outpatient management of asthma, diabetes, and infection improved. A community hospital that admitted 20 children a day in 1995 may admit two today. A six-bed PICU that is empty one day in four is running a census no adult unit would survive.
But low volume cuts the other way. Better medicine means more children survive complex conditions that were once fatal, so the children who do need intensive care are sicker and more complicated than before. Rarity and acuity are rising together: hard to justify financially, hard to staff safely, and the clinical case for regionalization strengthens exactly as the access case against it does.
Same specialty, half the pay
Pediatric subspecialists train up to three additional years and then earn dramatically less. How much more the adult subspecialist earned than the pediatric subspecialist in 2024:
In the 2026 fellowship match, no pediatric subspecialty filled all of its training slots. In a Children’s Hospital Association survey, 69 percent of pediatric subspecialists said lower pay was making them consider a career change. Source: Doximity Physician Compensation Report, 2025; CHA, 2026.
Half the children, a fraction of the cost
For a community hospital the comparison is not Medicaid versus Medicare. It is a pediatric bed versus the adult cardiac, orthopedic, or ICU bed that could occupy the same square footage. Kansas City gave its PICU space to the NICU. Tufts converted 41 pediatric beds to adult ICU and medical-surgical. At freestanding children’s hospitals, 50 to 80 percent of inpatients are Medicaid-covered, and 43 percent of Medicaid discharges involve a complex chronic condition.
Different equipment, different rooms, no repetition
Pediatric care requires size-specific equipment across the full range from a four-kilogram infant to a ninety-kilogram adolescent: airway devices, ventilator circuits, dosing systems, restraints, and monitoring. A hospital seeing two critical children a month must stock, maintain, and train on all of it with almost no repetition. Adult ICUs amortize their equipment across a full census. Community PICUs cannot.
The regionalization bargain
The closures are the visible half of a deliberate strategy: concentrate pediatric expertise in large children’s hospitals and route sick children to them. PICU beds rose 16 percent from 2008 to 2018, almost entirely at children’s hospitals. The clinical case is real. The question is whether the network it presumes exists, and whether the hubs can absorb a surge.
The 2022 stress test
That surge hit a system that had already lost about 20 percent of its pediatric beds over the prior decade. The system has lost more since. Regionalization works in ordinary years. It has not yet been shown to work in a surge year, and surge years are the ones that matter.
What distance costs
When a hospital closes its PICU, critically ill children still arrive in its emergency department. The outcome of stabilize-and-transfer depends on one well-studied variable: the pediatric readiness of that emergency department, scored 0 to 100 by the National Pediatric Readiness Project.
Mortality of critically ill children by ED readiness
Children were roughly four times more likely to die at the least-ready hospitals. A 2023 cohort of 796,937 children in 983 EDs estimated 1,442 deaths could have been prevented had every ED been high-readiness. Injured children treated at high-readiness EDs had 30 percent lower mortality out to one year. Sources: Ames et al., Pediatrics 2019; Newgard et al., JAMA Network Open 2023.
Transfer distance explorer
Drag to see what a given distance to the next PICU means in ground time, and which recent closure it resembles.
What is lost when a PICU leaves is not primarily the beds. It is the intensivist in the building, the pediatric-trained nurses on the night shift, the pediatric champion who keeps protocols current, and the institutional reflex that treats a sick child as a core competency rather than an exception. Hospitals that close the unit and keep that infrastructure can stabilize and transfer safely. Hospitals that let it erode will not know they have a problem until a child arrives who cannot wait 150 miles.
What comes next
Children’s hospitals outperformed adult hospitals financially in 2024 and 2025, but profitability hit a five-year low, and every analyst flags the same headwind: the One Big Beautiful Bill Act’s Medicaid financing changes landing on a sector where state-directed payments are 38 percent of pediatric Medicaid revenue.
Children enrolled in Medicaid and CHIP
Down about two million in a year, and below pre-pandemic levels for the first time in February 2026. When a parent is tangled in Medicaid paperwork, the child’s coverage lapses with it. Source: CMS Medicaid and CHIP Enrollment Data Highlights; KFF.
The financing shock
- $1 trillion in Medicaid reductions over ten years under the OBBBA. Work requirements exempt children; provider-tax and state-directed-payment changes do not.
- 38 percent of pediatric hospitals’ Medicaid funding comes from state-directed payments (Manatt Health for the Children’s Hospital Association).
- $75 million annual reduction projected at Phoenix Children’s, where 65 percent of patients are on Medicaid.
- Under 1,000 hospitals with pediatric units by 2032 if the 2.2 percent annual closure rate simply continues. The financing changes make that rate a floor, not a forecast.
- The study to measure whether outcomes and costs have been affected by the closures already made is only now being designed.
Pediatric Access Risk Index (PARI)
Six factors, scored 0 to 3, that a board can complete in one meeting with data the hospital already holds. Present it beside the financial case, not instead of it. Missoula and Kansas City both closed their PICUs this year; the index shows they were not the same decision.
A score of 0 to 5 indicates a closure that can proceed with monitoring.
What leaders can do
The closures in this report were made by capable executives looking at accurate numbers. The spreadsheet simply does not contain the variables that determine whether a child survives, and no one has required it to.
- Separate the bed decision from the readiness decision. Closing a PICU can be defensible. Letting ED pediatric readiness fall below the high-readiness threshold is not. Require a documented NPRP score before and 12 months after any pediatric service reduction, reported to the board.
- Name and fund a pediatric emergency care coordinator. Its absence is the most common deficiency at low-readiness hospitals and the cheapest to fix.
- Negotiate the transfer agreement before the closure. Acceptance time, transport mode and funding, a tele-critical-care line staffed by the receiving PICU, and a surge clause for when the hub is full.
- Model the surge case, not the average. A unit averaging two patients a month will be asked for six beds at once in a 2022-style season. Show the board both numbers.
- Count the downstream services. ED pediatric coverage, pediatric surgery, sedation for imaging, child life, and pediatric pharmacy leave together.
- Treat catchment community hospitals as part of the delivery system, not as referral sources. Lead a regional training and transfer protocol network of the kind SCCM and AAP are developing.
- Publish regional PICU capacity in real time to referring EDs during respiratory season. No community ED should have to call 20 hospitals.
- Staff tele-critical-care consultation as a budgeted service line, contractual and measured, not an informal favor.
- Raise pediatric Medicaid reimbursement toward Medicare parity for inpatient and critical care, the one recommendation every study converges on.
- Protect state-directed payments to pediatric providers in OBBBA implementation and require states to report the pediatric share of any reduction.
- Designate low-access pediatric units as critical access services with cost-based or supplemental payment rather than relying on the market to keep a necessary, unprofitable service open.
- Fund the subspecialty pipeline directly: loan repayment tied to pediatric critical care and rural practice, and RVU reform that stops pricing a child’s visit at half an adult’s.
- Require a child-access impact statement, including distance-to-care and readiness scores, in any certificate-of-need review for closing a pediatric unit.
The pediatric bed is the canary in American hospital finance: the service that pays worst, staffs hardest, and is needed least often. When the next child arrives at two in the morning, who is in the building, and how far will she have to go?
Sources:
Houghton K. Hospital Beds for the Nation’s Sickest Kids Are Disappearing. KFF Health News / CBS News, Oct. 28, 2026.
Bucholz EM, Cushing AM, Michelson KA, et al. JAMA Pediatrics, 2025 (pediatric and adult inpatient capacity 2008 to 2022).
Cushing AM, et al. Availability of pediatric inpatient services in the United States. Pediatrics, 2021.
Michelson KA, et al. Hospital pediatric capability 2003 to 2022. Pediatrics, January 2026.
KCTV5, KSHB 41, High Plains Public Radio: University of Kansas Health System PICU closure, April to May 2026.
NBC Chicago, Becker’s, Shaw Local: Saint Joseph Medical Center, Joliet, 2025 to 2026. Becker’s closure trackers 2025 to 2026.
Ames SG, et al. Pediatrics, 2019; Newgard CD, et al. JAMA Network Open, 2023; Melhado C, et al. ACS Clinical Congress, 2023.
Children’s Hospital Association and AAP letter to the White House, Nov. 14, 2022; HHS capacity data via CNBC and NBC News.
Doximity Physician Compensation Report, 2025; Children’s Hospital Association, 2026; Health Affairs Forefront, June 2025.
CMS Medicaid and CHIP Enrollment Data Highlights, 2025 to 2026; KFF; Chartis, 2025; Chief Healthcare Executive, Aug. 14, 2026; KFF Health News, Sept. 2025.
© 2026 Kelly Emrick, DHSc, PhD, MBA, BSRT(ARRT)R. Full report and free interactive tools for healthcare leaders at kellyemrick.com.