Salt Lake City-based Intermountain Healthcare and Sioux Falls, S.D.-based Sanford Health have signed a letter of intent to merge.
The boards of both nonprofit organizations unanimously approved on Oct. 23 a resolution to support moving forward with the due diligence process. Pending regulatory and state approvals, the merger is expected to close in 2021.
“We’re hoping that the actions taken … just 72 hours ago will culminate in a combined organization next summer,” Kelby Krabbenhoft, president and CEO of Sanford Health, said during an Oct. 26 news conference.
Existing boards of trustees from both systems will join to form a combined board, and Gail Miller, chair of the Intermountain board, will serve as board chair of the merged organization.
Marc Harrison, MD, president and CEO of Intermountain, will serve as president and CEO of the combined system, which will operate 70 hospitals and employ more than 89,000 people. Mr. Krabbenhoft will serve as president emeritus.
“These are two great organizations with strong histories that are economically and clinically very strong,” Dr. Harrison said during the news conference. “This is something that should happen for the future of American healthcare.”
Intermountain will be the parent company of the combined organization, and the merged system will be headquartered in Salt Lake City.
The pandemic put nurses on the front lines of the battle against COVID-19 and caused shifts in the way they provide care.
During this year, nurses have adapted to increased adoption of telehealth and virtual patient monitoring, as well as constantly evolving staffing needs.
These factors — and others, such as the physical and emotional conditions nurses have faced due to the public health crisis — are sure to affect nursing in the years to come. Here, 10 healthcare executives and leaders share their predictions for nursing in the next five years.
Editor’s note: Responses were edited lightly for length and clarity.
Beverly Bokovitz, DNP, RN. Vice President and Chief Nurse Executive of UC Health (Cincinnati): In the next five years, as we continue to encounter a national nursing shortage, I expect to see additional innovative strategies to complement the care provided at the bedside.
One of these strategies will be some type of robot-assisted care. From delivery of medications to answering call lights — and completing simple tasks like needing a blanket or requesting that the heat be adjusted — we will see more electronic solutions. These solutions will allow for a better patient experience and help to exceed the expectations of our patients as customers.
Of course, nothing can take the place of skilled and compassionate bedside care, but many tasks could be automated — and will be — to supplement the professional nursing shortage.
Natalia Cineas, DNP, RN. Senior Vice President and Chief Nurse Executive of NYC Health + Hospitals (New York City): Nurses will continue to play a vital role in addressing the health inequities and social determinants of health among vulnerable populations as the nursing workforce itself becomes more diverse and inclusive. As the largest segment of the healthcare workforce — with some 4 million nurses active in the U.S. — nurses represent the faces of the communities in which they serve. As America becomes a more diverse and inclusive society, so too will the nursing profession become more diverse and inclusive. Currently, industry estimates indicate that between one quarter to one-third of all U.S. nurses identify as a member of a minority group, with between 19 percent and 24 percent of U.S. nurses identifying themselves as Black/African-American; 5 percent to 9 percent identifying themselves as Hispanic; and about 3 percent identifying themselves as Asian. The percentage of minority nurses has been rising steadily for the past two decades and is expected to continue to climb in the coming years.
Blacks and underserved minority populations face numerous genetic, environmental, cultural and socioeconomic factors that account for health disparities, and the impact is particularly visible in the areas of cardiovascular disease, diabetes, pregnancy and childbirth mortality, and cancer outcomes, as well as the enormous toll of the current novel coronavirus global pandemic, where communities of color have been among the hardest hit populations.
In New York City alone, statistics compiled by the city’s health department show Blacks and Hispanics together account for 65 percent of all COVID-19 cases; represented 70 percent of all hospitalizations due to COVID-19; and, sadly, 68 percent of all deaths caused by COVID-19. As demonstrated during this pandemic, in the future, technology such as telehealth and virtual patient monitoring will play a major role in the care of patients. There will be a vast need to address social determinants of health by educating and providing resources to allow utilization of this technology such as using “wearable tech” to monitor ongoing health issues, such as high blood pressure, diabetes, heart conditions and other chronic illnesses.
Ryannon Frederick, MSN, RN. Chief Nursing Officer of Mayo Clinic (Rochester, Minn.):Nursing research will experience extraordinary demand and growth driven by a realization that both complex and unmet patient needs can often be best served by the role of a professional registered nurse. Nurses are uniquely positioned to implement symptom and self-management interventions for patients and their caregivers. Significant disruption in healthcare, including increasing use of technology, will lead to a dramatic shift to understand the role of the RN in improving patient outcomes and implementing interventions using novel approaches. Nursing researchers will provide a scientific body of evidence proving equivalent, if not better, patient care outcomes that can be obtained at a lower cost than traditional models, leading to an even greater demand for the role of the professional nurse in patient care.
Karen Higdon, DNP, RN, Vice President and Chief Nursing Officer of Baptist Health Louisville (Ky.):The value of nursing has never been more apparent. Nurses have led the front line during this pandemic. In the next five years, we must be flexible and creative in establishing new models of care, specifically around roles that support nursing, such as assistant and tech roles. Creating roles with clear role definition, that are attractive and meaningful for nursing support will help build consistent, high-quality models for nursing to lead. This consistency, along with IT capabilities that enhance workflow, will better allow nurses to work at the top of their scope.
Karen Hill, DNP, RN. COO and Chief Nursing Officer of Baptist Health Lexington (Ky.): 2020 was declared the “Year of the Nurse” and this reality has never been more true than realizing the personal and professional sacrifices of nurses in dealing with issues surrounding the pandemic. The next five years will require nursing professionals to be flexible to address new, unknown emerging issues in all settings, to be open to new opportunities for leadership in hospitals, schools and communities and to use technology and telehealth to provide safer care to patients. Nurses need to evaluate our practices and traditions that are value-added and leave behind the task orientation of the past. We need to honor our legacy and create our path.
Therese Hudson-Jinks, MSN, RN. Chief Nursing Officer and Chief Patient Experience Officer at Tufts Medical Center and Tufts Children’s Hospital (Boston):Over the next five years, I expect that the support and retention of clinical nurses will become the top priority of every CNO and executive team, given nurses’ direct impact on supporting the business of healthcare. This will be particularly critical because there will be a concerning shortage of experienced clinical nurses as a result of advancing technologies increasing complexity in care, additional nurse roles created outside traditional areas, fierce competition for talent between large healthcare systems, aging baby boom workforce retiring at higher rates year over year, and a lack of sufficient numbers of PhD-prepared nurses working in academia and supporting higher enrollments.
I also believe that CNOs will be laser-focused on creating the practice environment that enhances retention of top, talented clinical nurses, and we will put a greater emphasis on the influence of effective nursing leadership in reaching that goal. In addition, I fully expect that nurses will be seen more as individuals with talents and experience than ever before — not just a number on a team, but rather a professional with specific, unique, talents that are highly sought after in competitive markets.
Finally, I anticipate that nursing innovation will blossom, given the exposure of the “innovation/solutionist superpower” within nurses during the pandemic. Philanthropy will grow exponentially in support of nursing innovation as a result.
Carol Koeppel-Olsen, MSN, RN. Vice President of Patient Care Services at Abbott Northwestern Hospital (Minneapolis): During the COVID-19 pandemic nurses have been working in difficult physical and emotional conditions, which may lead to significant turnover after the pandemic resolves. Nurses have a commitment to serving others and will persevere until the crisis is past; however, when conditions improve, many nurses may decide to pursue careers outside acute care settings. A possible turnover, coupled with a service economy that has been devastated, may result in large numbers of former service workers seeking stable jobs in nursing. Hospitals will have to be nimble and creative to onboard an influx of new nurses that are not only new to the profession but new to healthcare. Tactics to onboard these new nurses may include the use of retired RNs as mentors, instructor-model clinical groups in the work setting, job shadowing and aptitude testing to determine the best clinical fit.
Jacalyn Liebowitz, DNP, RN. Senior Vice President and System Chief Nurse Officer of Adventist Health (Roseville, Calif.): Over the next five years, I see nurses providing more hospital-based care in the home using remote technology. Based on that shift, we will see lower-acuity patients move into home-based care, and higher-acuity care in hospitals will increase. With that, hospital beds will be used at a different level. My bold prediction is that we will not need as many beds, but we will need higher acute care in the hospitals.
Nurses will learn differently. As we are seeing now, nurses have not been able to train in the traditional way. They are already using more remote technology to educate, onboard and orient to their roles. It looks and feels vastly different, and nurses need to be comfortable with that.
As for patient care, I think data that can be gleaned from wearable biometrics, and the use of artificial intelligence will help predict patient care on a patient-by-patient basis. Nurses will work with AI as part of their thought process, instead of completely focusing on their own judgment and assessment.
I also believe we are going to face a nursing shortage post-COVID for a few reasons. Due to the emotional and physical toll of responding to a pandemic, some nurses will decide to retire, and another group will leave based on the risks that go hand-in-hand with the profession.
As for patient care, we are going to collaborate differently. There will be more video conferencing regarding collaboration around the patient. And I think in the future we will see that the full continuum of care will include a wellness plan.
Debi Pasley, MSN, RN. Senior Vice President Chief Nursing Officer of Christus Health (Irving, Texas):I believe the demand for nurses will become increasingly visible and newsworthy throughout the pandemic. This could drive increases in salaries and numbers of qualified candidates seeking nursing as a profession in the medium and long term. The shortage will, however, continue to be a factor, leading to more remote work options to both supplement nursing at the bedside and substitute for in-person care.
Denise Ray, RN.Chief Nursing Executive of Piedmont Healthcare (Atlanta): Nursing schools will need to focus on emergency management and critical care training utilizing a team nursing model. While nursing has become very specialty-driven, the pandemic has demonstrated gaps in our ability to adapt as quickly utilizing a team model where nurses lead and direct care teams. By implementing a team model and enhancing education in the areas of emergency management and critical care, nursing can adapt quickly to the ever-changing environment.
Also, communication with patients and families will take on different dimensions with wider use of tele-therapeutic communication. Nurses will be leaders and liaisons in the process, connecting physicians, patients and patient families virtually.Nurses will play a key role in integrating patient family members as true patient care partners— making sure they have the information they need to serve an active caregiving role for their family members during and after hospitalization. We’ll also see more nurses becoming advanced nurse practitioners, playing an expanded role in all healthcare settings.
A quick stop at the local Whole Foods Market recently yielded surprising insights into the dilemma faced by physician practices in the COVID-era telemedicine boom.
The store location opened just last year, part of a brand-new residential and shopping complex designed for busy professionals. It’s larger than the old-style, pre-Amazon era stores, and was designed to integrate Amazon’s online grocery operations into the bricks-and-mortar retail setting. There’s a portion of the store set aside for Amazon “shoppers” to receive and pack online orders for pickup and delivery, along with an expanded array of convenience-food offerings for the app-powered consumer to scan and purchase.
But when COVID hit, the volume of online orders went through the roof, and the store hired a small army of Amazon shoppers (including one of our own adult children who’s on a “gap year”) to keep up with demand. The result has been barely controlled chaos—easily 70 percent of the shoppers in the aisles last weekend were young Amazon employees “shopping” on behalf of online customers. They’re all held to an Amazon-level productivity standard, which makes the pace of their cart-pushing somewhat frantic and erratic. And the discreet area at the front of the store for managing the Amazon orders has become a noisy hub, making entering and exiting the store problematic. Even the “regular” store employees at Whole Foods have begun to complain about the disruption caused by the Amazon fulfillment operation.
It’s acautionary tale for traditional physician practices and other care delivery organizations looking to “integrate” telemedicine into normal operations. Integration sounds great in theory, but in practice raises important questions:
1)What physical space should be set aside for delivering virtual care?
2)Should telemedicine work be done in a separate, centralized location, or in existing clinic space?
3) How does the staffing of clinics need to change to meet the demand for virtual care?
4) How can we flex staffing up and down based on demand for telemedicine?
5)If new staff are required, how will they be incorporated into the existing team—or should they be managed separately?
6)What operational metrics will they be held accountable for, and what impact will those metrics have on other operational goals?
If Amazon, a worldwide leader online, renowned for running tight, precision, productivity-driven operations, is having trouble figuring out physical-virtual integration at the front end of their business, imagine how difficult these challenges will be for healthcare providers. The sooner we start to dig into these issues and find sustainable solutions, the better.
Over the past few weeks we’ve fielded a spate of questions from health system executives wondering about their peers’ plans for employees to return to the office. Some who have set a January 1st target for employees to return to their physical workspaces are now reconsidering.
“The first of the year sounded good back in the summer, but now it seems kind of arbitrary,” one system COO told us. “And if we really are entering a winter ‘third wave’ of COVID, it may not be a sound decision for health reasons, either.”Many have been positively surprised by the levels of communication and productivity since many employees began telecommuting full-time back in the spring. “It would be one thing to tell people they had to come back if the work wasn’t getting done. But for many, productivity has actually been better,” one executive shared.
Eight months into the work-from-home experiment (and with a handful of high-profile companies like Twitter saying employees can work from home forever), some leaders are now wondering whether they too should allow some staff to work from home permanently. The opportunities are obvious: real estate and overhead cost savings, and a potential boost to employee engagement and retention. But contemplating a long-term shift raises big questions.
As remote workers in expensive markets look to move to lower-cost cities, or even to states with lower tax rates, does a geographic connection to the area matter? As new staff who have never met in person are added, can culture and teambuilding be sustained? And how to blend operations and communication across remote staff and those who work in the office, by choice or necessity? (“In-person meetings are great, Zoom meetings have gotten better, but the ones where half of us are in a conference room and the other half are dialing in feel like a death knell,” one physician leader told us.)
The pandemic has likely launched a lasting shift toward “work anywhere”. But in order to capture the benefits of remote or flexible work, leaders must invest time and resources to rethink and transform the way they onboard, manage, operate, and communicate with the hybrid teams of the future.
Abstract: This article focuses on the correct strategic response to the impending implementation of price transparency on New Year’s Day of next year.
I have stated before that I have multiple articles in process at any given time. Some of them have been ‘in process’ for years because newer topics sometimes rise to the queue’s top. Price transparency is an example of such a case. I have a friend who is developing AI-enabled solutions to help organizations respond to price transparency government diktats. Few people beyond healthcare CFOs, healthcare financial consultants, and accountants have any useful understanding of how convoluted hospital pricing has become due to decades of ill-conceived government policy for the most part.
Another problem is endless confusion over terms. People frequently interchange the terms ‘price’, ‘cost’, ‘payment’, and ‘reimbursement’ in situations where the polar opposite is true on the other side of the issue. In other words, ‘cost’ to a payor is price or reimbursement to a provider.
Anyway, my friend’s questions finally inspired me to go to the Federal Register, acquire the final rule, and begin the process of learning where government is headed with these regulations. There are probably at least fifty diatribe angles I could launch into over the final rule, but I will confine my rant to only a couple of points.
First, the final draft of the rule is ‘only’ 331 pages long. The three-column final rule in the Federal Register is ‘only’ 83 pages long. That pales compared to Obamacare that is over 1,200 pages long, so by government standards, this is but a trifle of regulation.
Secondly, some parts of the final rule are actually funny. For example, CMS estimates that the average hospital will spend only 150 staff hours in the first and 46 staff hours in subsequent years complying with price transparency requirements. Is it constitutional for government to compel private enterprises to disclose the terms of what they thought were private contracts? Apparently so. Once government breaks this ice, will any agreement of any type ever be private?
As I have discussed price transparency with healthcare leaders, I sense that leaders are currently focused on technical compliance with the regulations. With COVID on their plate simultaneously, they have little capacity to take on strategic financial planning.
The final rule lays out in excruciating detail what providers face complying with the regulation. Reading the comments and responses is equally entertaining. CMS repeatedly says something to the effect; we heard your concern, and we’re proceeding as planned anyway. Litigation brought by the AHA and others has to date been unsuccessful in slowing stopping the price transparency snowball that is now most of the way down the mountain.
So, what are you supposed to do? The CFO and CIO will work, possibly with consultants’ assistance, to prepare the organization’s data release. Soon after the release occurs, expect the defecation to hit the rotary oscillator. The press will call out organizations with high prices, and the rancor over learning what some systems have been able to get from third-party payors will be entertaining, to say the least. Many people believe that one of the primary motivators of the massive consolidation occurring in the healthcare industry is the market leverage exerted by growing systems on third-party payors to obtain otherwise unachievable reimbursement rates.
Regardless of the course of action following price releases in January, the intended and most likely result of this initiative is to drive prices to a lower common denominator. A lot of people think Medicare rates will become that benchmark. There are two significant issues that I did not see addressed in the pricing rule that will have the effect of transferring substantial risk to providers.
The first is that there will be little if any provision for recognition of complications, comorbidities, and hospital-acquired conditions that can dramatically impact the cost of care in a given diagnosis.
The second is the elephant in the room. The current pricing system has developed over time to facilitate cross-subsidization among payors. There is a reason that commercial rates are so high that has nothing to do with the cost of providing care. I have stated before that, government has turned the entire healthcare industry into a taxing authority to extract tax from commercial payors for the benefit of government payors that routinely reimburse providers below the cost of providing care. It has been entertaining to watch the reaction of Boards of Directors when they first realize that the healthcare system has been forced by government into a wealth redistribution mechanism.
So, what happens as providers lose the ability to cross-subsidize the cost of care? Very few hospitals (<10%) are profitable on Medicare, and it is doubtful that any hospital is breaking even on services provided to Medicaid patients. In my experience, hospital reimbursement for self-pay patients is less than 5% of charges. If the prices hospitals realize for services start falling and they lose the current ability to cross-subsidize the cost of care . . . . . well, you don’t need an MBA to understand the likely outcome.
What to do? If (when) prices start falling and providers lose pricing leverage, the only place to turn is operating expense. Hospitals that have failed to undertake serious, highly focused, and robust operating cost reduction programs that yield quantifiable results may not have a very bright future. If your organization is not in the bottom quartile of operating cost compared to its peer group and part of your mission is to remain independent, you must be losing sleep. In a recent article related to COVID Response, I argued that the time has come to get after clinical process variance that is the source of most of the high cost, waste, and abuse in the healthcare system.For most organizations, the days of sourcing cheaper supplies and sending nurses home early are, for the most part, over as there is little if any juice remaining in that lemon.
If, as a leader, you do not have a plan that gets you to break-even on Medicare within the next 12-18 months, you had better have a plan B, something like tuning up your CV. I can help you with your response to price transparency, working on your CV, or helping manage your next career transition as the case may turn out. I am as close as your phone. Best of luck.
Contact me to discuss any questions or observations you might have about these articles, leadership, transitions, or interim services. I might have an idea or two that might be valuable to you. An observation from my experience is that we need better leadership at every level in organizations. Some of my feedback comes from people demonstrating interest in advancing their careers and inspiring content to address those inquiries.
The easiest way to keep abreast of this blog is to become a follower. You are then notified of all updates as they occur. To become a follower, click the “Following” bubble that usually appears near each web page’s bottom.
I encourage you to use the comment section at the bottom of each article to provide feedback and stimulate discussion. I welcome input and feedback that will help me to improve the quality and relevance of this work.
This article is an original work. I copyright this material with reproduction prohibited without attribution. I note and provide links to supporting documentation for non-original material. If you choose to link any of my articles, I’d appreciate a notification.
If you would like to discuss any of this content, provide private feedback or ask questions, I may be reached at firstname.lastname@example.org.
For the past three years, Kaufman Hall has surveyed hospitals and health systems on their performance improvement and cost transformation efforts. This year, these efforts met an historic challenge with the COVID-19 pandemic.
The pandemic’s impacts have been severe. Entire service lines were shut down as state governments required or strongly encouraged suspension of elective and non-emergency procedures, in part to conserve critical resources—including personal protective equipment—in the early days of the pandemic. Supply chains were disrupted, with organizations that had come to rely on “just in time” inventory practices scrambling to secure the resources needed to ensure the safety of patients and frontline clinical staff. The healthcare workforce came under incredible pressure, confronting a crisis that threatened to overwhelm the health system’s capacity to treat patients.
In a year unlike any other, our annual survey moved away from the questions of earlier years. We have focused on the impacts of COVID-19 on hospital and health system performance. Then, through interviews with survey respondents on the front line of the battle with COVID-19, we have sought to understand how health system leaders are seeking to find a path forward amid uncertainty that will likely stretch through 2021, if not beyond.
Key findings from this year’s report include the following:
Financial viability. Approximately three fourths of survey respondents are either extremely (22%) or moderately (52%) concerned about the financial viability of their organization in the absence of an effective vaccine or treatment.
Operating margins. One third of our respondents saw year-over-year operating margin declines in excess of 100% from Q2 2019 to Q2 2020.
Volumes. Volumes in most service areas are recovering slowly. In only one area—oncology—have a majority of our respondents seen volumes return to more than 90% of pre-pandemic levels.
Expenses. A majority of survey respondents have seen their greatest percentage expense increase in the costs of supplying personal protective equipment. Nursing staff labor is in second place, cited by 34% of respondents as their most significant area of expense increase.
Healthcare workforce. Three fourths of survey respondents have increased monitoring and resources to address staff burnout and mental health concerns.
Telehealth. More than half of our respondents have seen the number of telehealth visits at their organization increase by more than 100% since the pandemic began. Payment disparities between telehealth and in-person visits are seen as the greatest obstacle to more widespread adoption of telehealth.
Competition. Approximately one third of survey respondents believe the pandemic has affected competitive dynamics in their market by making consumers more likely to seek care at retail-based clinics.
Former system coordinator Tommy John Riker allegedly stole $798,265 worth of supplies from the hospital between 2017 and 2019. He worked in the hospital’s supply chain department and was responsible for purchasing and managing items in the hospital’s inventory control system.
His job allowed him to steal items from the hospital’s inventory and manipulate the inventory to make it seem the supplies were given to staff, according to investigators from Tennessee’s Comptroller’s Office, the Williamson Source reported.
The stolen supplies include needles, wound dressings and surgical dressings, according to the comptroller’s report.
Mr. Riker was indicted on one count of theft over $250,000 and 54 counts of money-laundering.
Trinity Health Michigan is raising its minimum wage to $15 per hour for hospital and medical group employees, the organization announced in an Oct. 19 news release.
The wage increase will affect 2,100 full- and part-time employees at Norton Shores-based Mercy Health and Canton-based Saint Joseph Mercy Health System, and their medical groups, IHA, St. Joe’s Medical Group and Mercy Health Physician Partners.
Employees affected by the wage increase include non-union environmental services workers, medical assistants, patient companions, food and retail services and transporters.
Trinity Health Michigan officials said an additional 6,000 employees making between $15 to $19 an hour will also “have their wage adjusted in order to maintain meaningful distinctions in pay.” They said the additional wage increases are to improve pay for a large number of employees, and help retain and attract talented workers.
“Our dedicated and compassionate employees are at the heart of what makes our health ministry remarkable,” Rob Casalou, president and CEO of Trinity Health Michigan, said in a statement. “As we continue to face the COVID pandemic and work together to address economic challenges, we want to recognize our employees whose commitment and talent have enabled us to care for our communities during this challenging time. These investments in our people are part of an overall philosophy to offer equitable and market-competitive pay and benefits for our staff, as together we build a strong future.”
Trinity Health Michigan officials said eligible employees are still slated to receive their annual wage increases for 2020-2021, and no increases are planned in medical health plan premium contributions for employees for 2021. Additionally, they said the base minimum of the employer’s core contributions will climb from $1,200 to $1,400 for calendar year 2021.
Mercy Health and Saint Joseph Mercy Health System are part of Livonia, Mich.-based Trinity Health’s Michigan region. Mercy Health serves the Grand Rapids, Muskegon, Shelby and the Lakeshore communities, and Saint Joseph Mercy Health System has hospitals in Ann Arbor, Chelsea, Howell, Livonia and Pontiac, according to Trinity Health’s website.
Here are nine hospitals and health systems with strong operational metrics and solid financial positions, according to reports from Fitch Ratings, Moody’s Investors Service and S&P Global Ratings.
1. St. Louis-based Ascension has an “AA+” rating and stable outlook with Fitch. The system has a strong financial profile and a significant presence in several key markets, Fitch said. The credit rating agency expects Ascension will continue to produce healthy operating margins.
2. Phoenix-based Banner Health has an “AA-” rating and stable outlook with Fitch and S&P. Banner’s financial profile is strong, even taking into consideration the market volatility that occurred in the first quarter of this year, Fitch said. The credit rating agency expects the system to continue to improve operating margins and to generate cash flow sufficient to sustain strong key financial metrics.
3. Cincinnati-based Bon Secours Mercy Health has an “AA-” rating and stable outlook with Fitch. The health system has a good payer mix, a leading position in several of its markets and adequate margins to support its growth, Fitch said. The credit rating agency expects the system to maintain strong operating profitability.
4. Children’s Hospital of Philadelphia has an “Aa2” rating and stable outlook with Moody’s and an “AA” rating and stable outlook with S&P. The hospital has a strong market position and healthy liquidity, Moody’s said. The credit rating agency expects CHOP’s market position and brand equity will support its recovery from disruption caused by COVID-19.
5. Milwaukee-based Children’s Wisconsin has an “Aa3” rating and stable outlook with Moody’s and an “AA” rating and stable outlook with S&P. The health system has strong cash flow margins, Moody’s said. The credit rating agency expects the health system’s financial performance to remain solid, given its commanding market presence and demand for services.
6. Philadelphia-based Main Line Health has an “AA” rating and stable outlook with Fitch. The credit rating agency expects the system’s operations to recover after the COVID-19 pandemic and for it to resume its track record of strong operating cash flow margins.
7. Midland-based MidMichigan Health has an “AA-” rating and stable outlook with Fitch. The system has generated healthy operational levels through fiscal year 2020, and Fitch expects it to continue generating strong cash flow.
8. Columbus, Ohio-based Nationwide Children’s Hospital has an “Aa2” rating and stable outlook with Moody’s. The system has a strong market position in pediatric services in Columbus and the broad central Ohio region, and its advanced research capabilities will support volume recovery from disruption caused by COVID-19, Moody’s said. The credit rating agency expects Nationwide Children’s margins to remain strong and for cost management initiatives and volume recovery to drive improvements.
9. Chicago-based Northwestern Memorial HealthCare has an “Aa2” rating and stable outlook with Moody’s. The health system had strong pre-COVID margins and liquidity, Moody’s said. The credit rating agency expects the system to maintain strong operating cash flow margins.
The financial challenges caused by the COVID-19 pandemic have forced hundreds of hospitals across the nation to furlough, lay off or reduce pay for workers, and others have had to scale back services or close.
Lower patient volumes, canceled elective procedures and higher expenses tied to the pandemic have created a cash crunch for hospitals. U.S. hospitals are estimated to lose more than $323 billion this year, according to a report from the American Hospital Association. The total includes $120.5 billion in financial losses the AHA predicts hospitals will see from July to December.
Hospitals are taking a number of steps to offset financial damage. Executives, clinicians and other staff are taking pay cuts, capital projects are being put on hold, and some employees are losing their jobs. More than 260 hospitals and health systems furloughed workers this year and dozens others have implemented layoffs.
Below are eight hospitals and health systems that announced layoffs since Sept. 1, most of which were attributed to financial strain caused by the pandemic.
1. Citing a need to offset financial losses, Minneapolis-based M Health Fairview said it plans to downsize its hospital and clinic operations. As a result of the changes, 900 employees, about 3 percent of its 34,000-person workforce, will be laid off.
2. Lake Charles (La.) Memorial Health System laid off 205 workers, or about 8 percent of its workforce, as a result of damage sustained from Hurricane Laura. The health system laid off employees at Moss Memorial Health Clinic and the Archer Institute, two facilities in Lake Charles that sustained damage from the hurricane.
3. Burlington, Mass.-based Wellforce laid off 232 employees as a result of operating losses linked to the COVID-19 pandemic. The health system, comprised of Tufts Medical Center, Lowell General Hospital and MelroseWakefield Healthcare, experienced a drastic drop in patient volume earlier this year due to the suspension of outpatient visits and elective surgeries. In the nine months ended June 30, the health system reported a $32.2 million operating loss.
4. Baptist Health Floyd in New Albany, Ind., part of Louisville, Ky.-based Baptist Health, eliminated 36 positions. The hospital said the cuts, which primarily affected administrative and nonclinical roles, are due to restructuring that is “necessary to meet financial challenges compounded by COVID-19.”
5. Cincinnati-based UC Health laid off about 100 employees. The job cuts affected both clinical and non-clinical staff. A spokesperson for the health system said no physicians were laid off.
6. Mercy Iowa City (Iowa) announced in September that it will lay off 29 employees to address financial strain tied to the COVID-19 pandemic.
7. Springfield, Ill.-based Memorial Health System laid off 143 employees, or about 1.5 percent of the five-hospital system’s workforce. The health system cited financial pressures tied to the pandemic as the reason for the layoffs.
8. Watertown, N.Y.-based Samaritan Health announced Sept. 8 that it laid off 51 employees and will make other cost-cutting moves to offset financial stress tied to the COVID-19 pandemic.