Northwest Iowa — A new report projects Iowa hospitals could lose $1.4 billion between March and September due to COVID-19.
The report found 90 percent of the state’s hospitals operated in the red during March and April, largely due to not being able to perform non-essential procedures. Marty Guthmiller, CEO of the Orange City Area Health System, says even with millions in state and federal support, some rural hospitals will close.
(As above) Guthmiller says, “While it’s difficult to predict, it’s relatively certain that we will lose some hospitals in Iowa simply because they do not have the capacity to withstand a downturn in revenue.”
Guthmiller says the CARES Act funding his rural hospital has received so far has only covered operating expenses for 36 days.
Sanford Sheldon CEO Rick Nordahl says the threat at the smaller, rural hospitals is real.
(as said:) “A lot of them are on the edge a lot of the time and with COVID and the lack of elective procedures and clinic visits because people weren’t going anywhere — revenues were substantially down. So if people didn’t pay attention to expenses, they were going to have big negative numbers and some places that don’t do as well as others have had negatives for quite some time — so it could cause closure.”
Nordahl says that as far as he can tell, Sanford Sheldon should be fine.
(as said:) “There’s a significant drop in revenue in April and May but I think that at the end of the day, over a longer period of time than those two months, we will come out just fine. Because we’ve got a very supportive community and that really is what drives rural health care — is supportive communities and consistency in your provider network.”
While much of the financial impact is tied to revenue lost when the state halted elective procedures, there are other expenses. UnityPoint Des Moines CEO David Stark says his hospitals are still losing a lot of money due to COVID-19 from doing things like staffing entrances to screen for the virus.
(As above) “We’re staffing every one of our facilities 24 hours a day and taking temperatures and asking screening questions,” Stark says. “For our organization alone, that’s a $2 million expense that we certainly didn’t plan on.”
Stark says his hospital is losing revenue as it continues to limit procedures and set aside beds for COVID-19 patients. The report was done by a Minneapolis accounting firm and was commissioned by the Iowa Hospital Association.
RadioIowa assisted with this story.
