New US hospitals face budget crisis over COVID relief money

Ultimately, this very moment may be the reason for the loss of the hospital.

Now plunged into red two years into the pandemic, the 29-bed, $40 million hospital with a sunny lobby and 110 staff is among three medical centers in the United States that say they are missing millions in federal pandemic relief money because the facilities are so new they lack complete pre-crisis financial statements to prove how much it cost them.

In Thomasville, located in forested country about 95 miles (153 kilometers) north of the Port of Mobile on the Gulf Coast, hospital officials worked for more than a year to convince federal officials that they should have gotten $8.2 million through the CARES Act, not just the $1 million they got. With a total debt of $35 million, the quest becomes more urgent every day, said Curtis James, the chief executive.

“No hospital can sustain itself without getting the CARES Act money that everyone else got,” James said.

Employees try to save money by cutting back on supplies, but residents, including Judy Hutto, worry about the future of the hospital. Hutto traveled there recently for tests from her home 24 kilometers into the country.

“The regions need it,” she said. “It’s a nice hospital.”

CEO Barry Beus is also trying to fill a gap at Rock Regional Hospital, located south of Wichita in Derby, Kansas. The hospital owes up to $15.8 million, officials said, but because it only opened in April 2019 and does not have full financial statements before the pandemic, it has no received just over $985,000.

The only thing that has saved the establishment from financial ruin so far is the cooperation of doctors, contractors and vendors who have not pushed for payments, he said. “If we lose them, we lose the hospital,” Beus said.

Three Crosses Regional Hospital opened in 2020 in Las Cruces, New Mexico, and racked up $16.8 million in losses in just three quarters while receiving just $28,000 in aid, said Landon Fulmer, a Washington lobbyist working with the three hospitals to secure additional funding. . Each facility is penalized for being new even if it provided the same expensive COVID-19 care as other medical centers and lost revenue from other procedures, including elective surgeries, he said.

“It’s really quite a strange situation in a way, a situation that shouldn’t have happened,” Fulmer said.

“HRSA has worked to provide as much support as possible to as many hospitals as possible within the limits of the law and funding,” he said. The agency said it used indirect financial information for hospitals opened in 2019 or 2020 to create a fair payment system.

“They all received funding,” Lundquist said.

While virtually all aid money is earmarked, Lundquist said hospitals requesting additional aid can go through an appeals process. Hospitals can also apply for additional credit or funding in future fiscal years, he said. All three hospitals say they deserve better.

Thomasville officials are trying to leverage congressional influence. Mayor Sheldon Day made several trips to Washington, D.C. to speak with members of the state’s congressional delegation and health officials, and Alabama Hospital Association President Dr. Don Williamson , contacted the White House for help.

“They were assured that they were going to be taken care of. But the fact is when you’re dealing with government entities, you don’t have the money until you have the money,” Williamson said.

The last hospital closed in Thomasville more than a decade ago, leaving only hospitals with fewer services in the surrounding area. Officials have worked for years to secure a new hospital so residents don’t have to drive 90 minutes for high-tech services like digital imaging, full surgical options, echocardiograms, 3D mammography and more Again.

Through a partnership between the city and a municipal health care authority, Thomasville Regional secured federal funding from the Department of Agriculture and opened on March 3, 2020, before COVID-19 cases caught fire in the rural south.

“We thought we had a good start,” said James, the general manager. “And then it all stopped.”

Patients stopped showing up for scans, elective surgeries, mammograms and other money-making services due to pandemic shutdowns, and financial reports that looked promising turned perilous within weeks.

Recognizing that new hospitals could not calculate COVID-19 losses because they could not compare 2020 numbers with previous years, Health and Human Services allowed hospitals to use budget numbers for calculations. rather than previous financial statements. That’s how the hospital determined it was over $7 million short of aid, James said.

While the hospital is still waiting for this aid, he said, the government has agreed to provide $1 million in aid to all other hospitals.

“It was OK, but other hospitals in our area got $8 million, $9 million,” he said.

The Birmingham-based Medical Properties Trust recently gave the hospital $2 million and James said executives were confident Thomasville Regional would eventually get the additional federal aid. “But it will take time,” he said.

Like Thomasville Regional, Rock Regional in Kansas saw its revenue dry up soon after opening, said Beus, the CEO. He’s still experiencing staffing shortages due to the pandemic and having to pay traveling nurses a premium to work shifts on the wards, he said, while working with consultants and congressmen just trying to stay afloat.

“It’s been a little frustrating,” he said.


The Associated Press Health and Science Department is supported by the Howard Hughes Medical Institute Department of Science Education. The AP is solely responsible for all content.

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