At a time when hospitals are needed more than ever, they are struggling.
Last month, Oregon Gov. Kate Brown ordered hospitals to stop elective procedures to save space, protective gear and staff for an expected surge of coronavirus patients.
For many hospitals, elective procedures make up the majority of revenue — some have had to lay off nurses and medical technicians, and bailout money from the federal government that was supposed to help cover the revenue gap has been less than expected for Oregon hospitals.
Becky Hultberg is the CEO of the Oregon Association of Hospitals & Health Systems, and she joined OPB “Morning Edition” host Geoff Norcross to talk about the state of Oregon’s hospitals.
Here are highlights from their conversation:
Geoff Norcross: How much of a revenue drop have hospitals seen due to canceled elective procedures?
Becky Hultberg: “You know it really depends on the hospital — where the hospital is located, what it’s payer mix looks like and what kinds of procedures it does. But when we look at the finances of our member hospitals, we’re seeing revenue drops anywhere from 40% on the low end to up to 70% on the high end.
Norcross: Some smaller, rural hospitals don’t see a lot of patients to begin with – how have rural hospitals been affected?
Hultberg: “Rural hospitals I think have been disproportionately impacted for a couple of reasons. Their finances tend to be a little more marginal anyway, so any kind of revenue drop, it’s going to hit them harder. They, like all of our other hospitals, prepared for a surge in COVID patients — but we haven’t seen a surge in COVID patients in rural areas. We’ve seen more of those patients in the metro area, [and] very few in some of our counties. So essentially then, you’ve emptied out a hospital, stopped elective procedures, volume has dropped and you don’t have any patients.”
Norcross: Was the policy from the governor’s office too broad?
Hultberg: “You know, I think there’s going to be a lot of Monday-morning quarterbacking when we reach the end of this first wave. But if you look back at the time when the governor made that order, Washington state hospitals were feeling catastrophic impacts of the patient surge.
“It was critically important that we save every available amount of personal protective equipment in the state to deal with what could have been a huge patient surge. So at the time, no, I do not believe it was an overreaction. We supported that policy decision because of the circumstances on the ground at that point in time.
“Now as we know, because of the policies she implemented around social distancing, our surge has not been as big as it could have been.”
Norcross: The federal CARES Act included funds for hospitals specifically to fill their budget gaps. But Oregon hospitals are seeing less of that money than some other states. Why?
Hultberg: “Oregon has one of the highest percentages of Medicare advantage [enrollees], so that is essentially a managed version of Medicare, kind of a managed care plan.
“When they did the allocation of the first tranche of federal funding, they did it based on Medicare fee-for-service, which is a different kind of Medicare plan. And so since we have a higher percentage of Medicare advantage, our hospitals got less money.
“Now we hear that in the second round of funding, that hopefully will go out this week — we’ll see. There’s going to be an adjustment to account for that. So we’re hoping that our hospitals get what we think they deserve out of that federal funding, but again the first round did short-change them a little bit.”
Norcross: Oregon’s model of healthcare focuses on prevention, but it also leads to us having the fewest hospital beds, per capita, of any state in the country. Should that model change?
Hultberg: “I think we’re all going to be doing some planning and thinking after we get through the critical part of this incident. Is it good to have a system that focuses on primary care, and keeps people out of the hospitals? Absolutely it’s good. And we need to build on those successes.
However, as we look toward the future — and quite frankly toward the next two years, when we’re going to probably see waves of this disease coming and going — we need to plan on how we better adjust our capacity. [That] doesn’t necessarily mean we need to build a bunch of empty buildings, but we do need to be thoughtful in how we’re going to take care of patients if and when we do have a surge that overwhelms our hospitals. We are incredibly fortunate that that has not happened in this first wave, but I think it really opened our eyes to what we need to think about in the future.”
To listen to the entire conversation, use the audio player at the top of this story.