There are several possible explanations. As Chaosmagnet mentioned, all hospitals are not created equal. The hospital two blocks away may not be a designated "Trauma Center". In addition, Trauma Centers are designated at various Levels. See Trauma Center Levels Explained. Level I are the highest level of care, for the most severely injured patients.

Also it could be that the nearby hospital's ER was already at capacity. Smaller hospitals often only have one or two ER physicians on duty. If they were already seeing patients, EMS might divert to another hospital where the ER was not as busy.

EMS Dispatch normally makes these decisions. In most places, they do a good job of getting patients to the right facilities, balancing level of care required, transport time, and available capacity of facilities.