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WHEN HOSPITALS GET SICK Losses piling up at Kootenai Health

Staff Writer | May 10, 2020 1:40 AM

COEUR d’ALENE — Kootenai Health lost $6 million in the last two weeks of March, according to CFO Kimberly Webb.

April numbers, still being compiled, look worse — doubly damning at another $12 million to $15 million lost. The malaise has lingered into May.

Except for a few critical positions, Kootenai Health has a hiring freeze in place, said Danny Klocko, the hospital’s executive VP for human resources. The momentum behind constant, robust growth — from around 1,600 employees in 2010 to more than 3,600 in 2020 — is gone.

“We’re trying everything we can to avoid layoffs,” Webb said. The hospital’s leadership team acknowledged that more than 500 employees have already participated in voluntary furloughs of up to one full month.

But the big number, the one that surely foments second-guessing by day and bad dreams by night, is this:


Since the day the threat of a virus forced Kootenai Health to quickly become something it had never been, 0 people have been treated for COVID-19 in the hospital’s intensive care unit.

Not one.

A semi slamming on the brakes, Kootenai Health had just reached its top speed of all time.

“The highest in-patient day in the entire history of Kootenai Health happened the week before the coronavirus incident command situation hit,” said CEO Jon Ness. “And so the real challenge there was we literally had to stop everything.”

Financially, the driver went through the windshield.

Wicked timing slid an extra shard of glass under the skin. Kim Anderson, who oversees the organization’s communications and marketing, noted that on April Fool’s Day, “kind of smack in the middle of this,” officials finalized the purchase agreement for Clearwater Valley and St. Mary’s hospitals.

Money was flowing out; revenue was drying up.

“We have had to make investments in setting up testing sites, planning for the surge, expanding inventory for PPE (sold at a premium), additional staff for entry screening and more frequent high-touch area cleaning,” Anderson said. “One key factor was the recommendation by the CDC to postpone elective or non-emergent procedures to free up capacity and conserve PPE. All ‘non-essential’ face-to-face physician visits were also canceled.”

This is not to say 3,600 employees have been twiddling their thumbs.

“We would have 20-plus patients in the house in any one day, sometimes more than that, that we thought may have it,” Webb said. “We would have to wrap all those protections around those patients and employees at all times. We continue every single day to have people that are not confirmed but are suspected to have it.”

And every single day, those people have to be treated like they’ve been struck by COVID-19. That costs plenty — financially and, from an employee perspective, emotionally.

“Six weeks ago, we didn’t have adequate personal protection equipment for our employees because there was a shortage of all that,” Webb said. “I think that’s where a lot of anxiety for our employees came from. We were changing daily, requirements were changing daily because of our scarce resources and the changing guidelines from the federal government.”

While hospital personnel have been continually socked in the stomach by foes beyond their reach, the big picture has been coming into clearer focus. It is not pretty, as Anderson cast an unfiltered light on some hard truths:

• Clinical knowledge of novel coronavirus and COVID-19 is still only four months old. There is still a lot medical experts don’t know about its spread, development of immunity, the virus’s ability to mutate, and its long-term impact.

• The United States is likely headed for the worst economic situation many have seen in their lifetimes.

• Unemployment will spike in the coming months. As of Friday, national unemployment was already at 14.7 percent.

• Kootenai Health is one of only 32 standalone independent hospitals of its size remaining in the U.S.

“This means we will need to do the work to recover ourselves,” Anderson said.

While recovery is still an unfulfilled promise — Ness thinks the losses will continue for at least another month or two — the federal government did ease the financial fallout somewhat.

Webb said that on April 10, the organization received a congressional stimulus payment of $11.4 million for Kootenai Health and its two critical access hospitals.

That was followed by a $7 million payment May 6 specifically for the facilities in Cottonwood and Orofino.

While grateful, Webb was also realistic.

“That didn’t cover the losses,” she said, adding: “We don’t expect to get any more funding.”

Nor does Kootenai Health have a treasure-stuffed cave somewhere. Webb said the organization has roughly 180 days cash on hand.

“From a benchmark perspective, hospitals our size that are A-rated [KH is A-rated by Standard & Poor’s] usually have a little bit more than that,” Webb said. “But we’ve been spending money to build up our facility and meet the needs of the community...We’re a little bit less but in pretty good position with 180 days cash.”

Klocko, the human resources executive, said spending decisions have been pretty much out of hospital leadership’s hands.

“As the community health care provider, we have an obligation to follow all the mandates and all the agencies’ guidelines,” he said. “Whatever your political beliefs or your clinical beliefs are, I think we’ve 100 percent done the right thing.”

Anderson drew on an analogy about the price of safety:

“You get in your car and you put on your seatbelt and you drive to your destination, and if you didn’t get in an accident and you didn’t need that seatbelt, it doesn’t mean wearing your seatbelt was the wrong thing to do.”

True, but that seatbelt didn’t cost $20 million.

Ness was philosophical about the hospital’s position today. However, a trait he’s exhibited throughout his 10 years at the helm — optimism — also shined through.

“One view of this is that some would say health care over-responded,” he said. “The other side of that is in North Idaho, there have been no fatalities. We have had a minimal number of in-patient coronavirus patients, and the number of patients that have tested positive here has been very small on a percentage basis.”

Looking a bit like a fighter who’s lost his swagger but not a strong counterpunch, Ness lingered on the positive.

“If what matters most is safety and patient lives,” he said, “I think it’s been very successful. In many ways, I’d say it’s one of our proudest moments.”