Hospital executives who expected rebound from COVID this year say theyre stunned by financial losses instead – OregonLive

George Newmyers knee replacement was supposed to be a routine day surgery. Then he stopped breathing.

The doctors and nurses at Adventist Health Portland resuscitated him. After such a close call, they wanted to keep him overnight in the Southeast Portland hospitals intensive care unit.

That was a problem. There were no available beds. So like a lot of patients in Oregons overcrowded, overwhelmed health system, he waited.

The fact that hed all but expired moments earlier on the operating table didnt get him special access. Neither did the fact that his wife, Joyce Newmyer, is the chair of Adventist Portlands board of directors and its former CEO.

The thorny questions raised by the bed shortage got very personal that day, she said.

Similar scenarios are playing out all over Oregon. A lack of qualified healthcare workers, which began before the pandemic and worsened after COVID-19 hit, and the resulting shortage of staffed hospital beds are putting thousands of patients at risk.

An estimated 700 patients are stuck inside hospitals, either waiting for a bed to open up or for a suitable place to fully recover. Rehab centers and skilled nursing facilities have been hit by the same staffing issues and resulting shortage of beds.

Thats the equivalent of two big hospitals-worth of patients, said Becky Hultberg, CEO and president of the Oregon Association of Hospitals and Health Systems

The Adventist staff eventually put George Newmyer in the cardiac unit, and he recovered fully. Time will tell if Oregon hospitals enjoy a similar happy ending.

The new dynamic has put Oregon hospitals in a serious financial bind. The magnitude and speed of the downturn has left hospital executives shaken and grasping for answers.

Ive been in this business 34 years and this is unprecedented, said William Olson, CEO of Providence Health & Services Oregon operations.

This really was the year we were supposed to put COVID behind us, said Joe Ness, senior vice president and chief operating officer of OHSU Healthcare, which oversees OHSU Hospital and Doernbecher Childrens Hospital. Instead, were facing a whole new set of anxious moments and complications to deal with. Its tough.

Critics dont buy hospital executives claim that theyve been caught unaware. The Oregon Nurses Association, the union that represents the nursing staff at OHSU and some other hospitals, said the hospitals current problems are largely self-inflicted, the result of failure to recruit staff and keep them happy enough to stay.

The hospitals have already approached state lawmakers seeking about $12 million in emergency financial assistance. The hospitals have already received hundreds of millions of taxpayer dollars from the federal CARES Act and other pandemic assistance programs.

Nonetheless, the problems stretch to the far corners of rural Oregon.

Virginia Williams, CEO of the Curry Health Network, which runs a hospital in tiny Gold Beach on Oregons south coast, said the lack of beds in the city make it difficult for rural hospitals to send their most desperately ill patients to the better equipped facilities.

Were making healthcare unsafe, Williams said.

HELP WANTED

Years before the pandemic, predictions of a nurse shortage were common. A generation of veteran nurses were aging out, and there werent enough youngsters to replace them.

For a short while, the pandemic postponed the inevitable.

Our turnover rates for the 18 months at the height of the pandemic were the lowest in history, said Christine Bartlett, OHSUs associate chief nursing officer. Everybody stayed. We were heroes.

But then the worst public health crisis in a century turned a demographic blip into a mass defection. Late last year, the omicron variant led to yet another surge. Some patients refused to get vaccinated and were hostile, Bartlett said. Nurses were like, Im done. I have nothing left to give.

OHSU and Doernbecher hospitals are looking to hire as many as 1,000 health care workers. Thats more than double the pre-pandemic number, Ness said.

Providence has 1,700 openings in Oregon, 700 of them for nurses.

The only higher priority than filling those vacancies is keeping hold of the caregivers who havent left. And that may not be easy.

Morale is low, said Providences Olson. The number of workers calling in sick has exploded, from 2,433 per month in 2021 to 3,819 per month in 2022.

Thats the burnout factor, he said. Weve been dealing with this pandemic for three years now. Its like weve reached a breaking point.

Providences personnel issues are exacerbated by the giant health systems frequent clashes with its nurses and other employees over pay. It has eliminated some incentive bonuses. Last month, employees filed a class-action lawsuit against the health chain for shorting paychecks. A botched new payroll IT system caused widespread problems.

BRIDGING THE GAPS

A 29-year-old nurse said she got her start in nursing at a large hospital in the Southeast. Her starting wage was $23 an hour, $44,850 a year.

This year, she was earning $72 an hour plus a stipend for food and lodging that resulted in a blended rate of $116 per hour.

The nurse had become a traveler. She had signed up with a temp agency that specialized in matching traveling nurses with hospitals from all over the country. (She didnt want her name used for fear of burning bridges with potential employers.)

For a health care system desperate to fill immediate holes in their payroll, there are few options other than temporary workers.

They are expensive. Healthcare consulting firm Kaufman Hall reported in March that the median wage for a traveler had reached three times the pay for local employees.

OHSU expected to spend $12 million on so-called contract labor in 2022. Instead, as job vacancies mounted, OHSU had little choice but to break the bank on temp workers. It figures it will have spent $92 million on a record 444 traveling nurses by years end.

OHSUs top budget goal going into 2023 is to cut traveler spending in half.

TRAFFIC JAM

Jeremy Lail is wrung out after working two weeks straight in the emergency department at Providence Portland Medical Center. Half or more of the units 40 beds were taken up by boarders patients in serious enough condition to be admitted to the hospital but stuck in the emergency room due to the lack of available rooms.

Meanwhile, a continuous flow of new patients 30 to 50 at any one time arrived in the lobby. The lucky ones waited just three hours for treatment.

Theres a lot of anger out there in the lobby, said Lail, a veteran nurse who is also active in the nurses union. Its a lot to deal with, it just gets overwhelming.

OHSUs emergency department set an unfortunate new record earlier this week: 41 patients were boarded, an all-time high.

Where do you put 41 people in a department with 37 rooms?

Wherever you have space, Ness said. Sometimes, they have to double up. Its not ideal.

The other pinch point in patient flow comes at discharge.

Patients well enough to leave but in need of continued, lower level healthcare typically would be sent to a skilled nursing or rehab facility.

But those operations are suffering their own shortage of staffed beds.

Its true our ability to accept new customers is constrained, said Kevin Tomlinson, chief financial officer executive at the Avamere Family of Companies, a Wilsonville-based group of senior housing and health care companies. Were trying to fix this. Weve bumped up salaries.

Tomlinson also said hospitals try to foist people with mental illness and addiction off on care homes knowing they arent equipped to handle those patients.

With care homes at capacity, hospitals are stuck warehousing patients, Olson said. Thats doubly painful for hospitals because the patients while not receiving treatment generate little revenue and occupy a bed that a paying customer cant get into.

In hopes of easing the pressure, Providence a year ago opened its own rehab facility at its Northeast Portland hospital. The huge nonprofit started small with a capacity of 12 residents and intends to expand to 28 next year.

THE BOTTOM LINE

The extent of the damage done became apparent when the hospitals began releasing their 2022 financial statements.

Providence lost more than $51.2 million from operations in Oregon just in the first half of 2022. Throw in investment setbacks and other non-operating problems and Providence Oregons expenses topped its revenue by $291 million.

OHSU lost $64 million through the first 11 months of its fiscal year 2021-22, a bitter surprise for managers who had forecast a net gain from operations of $72 million.

Collectively, Oregon hospitals lost $103 million just in the first quarter. No one interviewed for this story expects any improvement in the rest of the year.

It really does feel like the wheels have fallen off, said Hultberg, head of the hospital trade association.

St. Charles Health System in Bend, which operates hospitals in Bend, Redmond, Prineville and Madras, has been among the hardest hit. It lost $21.8 million in the first quarter. It laid off 105 employees and froze another 76 positions in May. CEO Joe Sluka resigned in July.

In that same month, St. Charles moved to a new crisis standard of care. An obscure set of public health rules allow hospitals to adopt lower care standards in the case of a public health emergency like a natural disaster or a pandemic.

The state policy directs hospitals to create triage teams that would determine which patients can be saved and which cannot.

Oregon Health Authority guidance to hospitals explains: The very nature of triage during a crisis will mean certain people may be excluded from some types of medical attention, perhaps even life-sustaining treatment (for example, ventilator or ICU bed access.)

Some dismissed the move as scare-mongering and a publicity stunt. In any case, St. Charles quickly retreated and dropped the emergency status.

But St. Charles is not the only health system to take these steps. Curry Health in southwest Oregon did the same on several busy weekends earlier this year.

Even OHSU moved off of normal operations and into contingency levels of care early this summer.

The Oregon Nurses Association blasted the move. It argued that the staffing shortage at OHSU was due to its tightfisted treatment of its caregivers as much as pandemic fatigue. Union members called on OHSU leaders to replenish its workforce, whatever the cost.

Pat Allen, director of the Oregon Health Authority, declined to jump into the OHSU union-management scrum. But theres little doubt about the bottom line impact.

Is the quality of care being impacted? Yes, definitely, he said. Is there an obvious answer? No. This is a deep societal problem we have to figure out.

-- Jeff Manning, jmanning@oregonian.com

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Hospital executives who expected rebound from COVID this year say theyre stunned by financial losses instead - OregonLive