Campbell County Health (CCH) officials said that unless decisive actions are taken to improve the system’s financial state, current financial projections indicate the healthcare system could be insolvent by 2026.
The announcement comes as CCH recently hired Matthew Shahan as their new CEO, replacing interim CEO Jerry Klein, who subsequently served in the position after the CCH Board of Trustees fired former CEO Colleen Heeter in October.
Many hospitals and healthcare systems are continuing to deal with the effects the COVID-19 pandemic has wrought, especially in rural areas.
“It’s a funny thing to hear people in the community talk about this kind of misguided notion that COVID was a windfall for hospitals, especially rural hospitals—it has decimated a lot of them,” said Adrian Gerrits, Board Chairman of the CCH Board of Trustees. “We’re not in a position where we’re close to closing or going to close but it was a huge hit to our financial goals.”
While COVID-19 dollars haven’t been able to alleviate CCH’s financial difficulties, the federal relief funds have provided needed assistance.
Gerrits said that CCH’s financial difficulties have been developing for several years, which were only exacerbated by the effects and demands of the pandemic. These included having to reallocate staff and resources to care for patients with COVID-19, having to shut down the few profitable services they offer, as well as having to cancel elective surgeries due to the pandemic.
“We got a lot of COVID relief funds in 2020 that made our 2020 not look horrendous,” Gerrits said. “Really, I would say the worst part of the pandemic was this last fall, toward the end of 2021. Basically August, September through November, December. We got hit really hard and the COVID relief funds, the big boluses of cash infusion that we had got the year before really weren’t there.”
Other local medical facilities have also been a source of increased pressure and loss of revenue during the pandemic.
“We’ve got a lot of competition moving in with our surgery department, which is one of the things that makes us money,” Gerrits said. “Every time we have to shut down, of course our patients migrate to the surgery centers in town that don’t have to shut down to take care of the pandemic patients.”
Other contributing factors include having to care for sicker patients and for longer, something that Gerrits said is a general trend being experienced nationwide.
There is optimism that CCH can turn its financial situation around. Right now, trustees aren’t looking at what insolvency might look like if it were to happen, but putting much effort into making sure that point isn’t reached. One way they are doing this is by developing a medical records system, which is slated to be ready by next year. Gerrits said this will aid CCH getting bills out in a timelier manner and collect more data, something that has been lacking for years.
The CCH Trustees closed the Close to Home Hospice Hospitality House due to the high costs of operating and maintaining the facility, which cost between $1 to $1.5 million annually to keep open. This is another way they are trying to avoid insolvency.
CCH would like to bolster services and make them available to the community while breaking even financially. Business development will be part of this to help ensure that an adequate number of patients can make those services viable, Gerrits said.
“We came up with a list of our priorities in the next year and then three years and five years, and number one is quality patient care,” Gerrits said. “Our focus as a board is to maintain quality patient care and then really look at what the community needs versus what the community wants in the future.”
Obtaining grants is another way in which CCH hopes to offset some of the financial losses that it’s experienced in previous years. Though CCH has not typically employed a grant-writer, Gerrits said they’re looking to do so in efforts to obtain outside funding.
Currently, Gerrits said that there’s a staffing shortage CCH is contending with. This equates to around 110 full-time positions that are vacant. This has led to hiring contract labor at greatly inflated rates to ensure that positions are covered, especially when there are surges of COVID-19. Ideally, CCH would like to fill positions with salaried or hourly employees and not contracted or temporary staff, which he says will provide significant cost-savings.
