Las Vegas Sun

March 29, 2024

Pandemic, fewer patient visits cause strain on financial health of Nevada hospitals

University Medical Center

Steve Marcus

An exterior view of University Medical Center Wednesday, Oct. 8, 2014.

When the first cluster of coronavirus cases began to appear statewide in March, Nevada health officials moved swiftly to ramp up facilities for a potential overflow of patients.

Hospitals set up triage stations near emergency room entrances, increased testing capacity and their stock of ventilators, personal protective equipment and other supplies. Physicians canceled elective surgeries and procedures to mitigate infection spread.

Luckily, that surge of patients never arrived, at least not to the degree that was initially projected.

The statewide shutdown and government officials’ quick action on social distancing protocols spared the state from the overwhelming cases and deaths seen in states like New York and New Jersey.

But now Nevada hospitals may face another crisis: The financial pressures to come as the pandemic persists. The American Hospital Association estimates $202.6 billion in losses to hospitals and healthcare systems across the United States over the next four months, an average of $50.7 billion per month.

University Medical Center, which is operated by Clark County could see a $217 million structural deficit in the fiscal year beginning July 1, said Jessica Colvin, the county’s chief financial officer

UMC CEO Mason VanHouweling told commissioners last month that although the hospital was financially above water before the pandemic, it endured a significant decline in revenue by mid-March when residents needed to delay surgeries and procedures because of the virus.

“The hospital really became a ghost town at that point,” he said. “We were purely taking care of COVID-19 patients in our ICUs and in our emergency departments.”

Expenditures are up about two-thirds due to testing efforts and acquiring the necessary PPE, he said. The hospital census is down 60%, VanHouweling added, even though nonelective surgeries reconvened May 4.

“It’s slowly coming back but we’re testing every patient that’s coming in,” he said. “Business has been severely impacted not only at UMC but to all hospitals throughout the entire state and country.”

There has been a decrease in visits to the emergency room visits across the state, said Amy Shogren, spokeswoman for the Nevada Hospital Association. The association represents Nevada’s acute care hospitals as well as specialty hospitals and healthcare organizations. The assumption is that people are hesitant to resume the care they need at a hospital out of virus fears, she added.

“We want to get the word out that hospitals are safe to patients to visit, not only for surgery, but for ER,” she said.

Not seeing adequate Medicaid and Medicare reimbursements from surgical procedures while still having to treat Medicaid and Medicare patients for other illnesses has had an impact as well, said Dr. Joe Corcoran, chief medical officer for HCA Healthcare, which oversees MountainView Hospital, Southern Hills Hospital & Medical Center, Sunrise Children’s Hospital and Sunrise Hospital & Medical Center.

“There has always been more of a cushion in surgical procedures than there are for patients admitted for medical issues like pneumonia,” he said. “The income made from say knee surgery, that income helps pay for the Medicare patient who is admitted for a long time with pneumonia and secondary problems. Without that supplement that comes from the surgical side, hospitals are really struggling to pay the light bill.”

Last month, state officials announced $241,471,841 in Coronavirus Aid, Relief and Economic Security Act funds would be distributed to hospitals 2,581 health care providers and hospitals in Nevada. While appreciated, those funds will only scratch the surface, Shogren said.

“Unfortunately there’s just a lot of costs that this money doesn’t cover,” she said.

Corcoran said HCA hospitals are likely better positioned to weather the rest of the health care financial crisis the pandemic has unleashed than others, particularly those serving rural communities in Nevada.

“I worry about what’s going to happen to a lot of our current hospital capacity moving forward,” he said. “Publicly owned hospitals that don’t have billionaire benefactors, they’re going to struggle.”

It’s likely that private practices across the county will also struggle to keep their doors open. One survey conducted by Merritt Hawkins, a physician search/recruiting firm, reported that 14% of physicians plan to change their practice due to the virus while 18% plan to retire or totally opt out of patient care.

“Nevada already has challenges, particularly in primary care, to care for what has been a growing population,” Corcoran said. “This may set us back and that concerns me.”