The economics of hospitals and health care was discussed at a University of Kansas Health System news conference on Friday morning with U.S. Sen. Jerry Moran, R-Kansas, and hospital officials.
Sen. Moran remarked that perhaps the reopening of the economy could be led by the return of hospitals and health care providers to something more close to normal.
He said he hoped that revenues from patient care return to the health care delivery system. Doctors at the news conference said that hospitals and health care offices are among the safest places to be with more protective measures in place.
“Margins in a hospital are pretty slim,” Doug Gaston, senior vice president and chief financial officer at KU Health System, said at the news conference.
Hospitals were particularly hard hit during the COVID-19 pandemic, as they had to scale back their elective surgeries and non-emergency visits, while also spending more money to obtain tests, gear and equipment to fight COVID-19. Some recent publications reported a third of the fall in gross domestic product was due to health care industry, according to KU doctors.
Gaston said ratings agencies stated the average margin for hospitals is 1.7 percent, meaning that for every $1,000 in charges, it adds $17 to the bottom line.
“Given that framework, we can’t stand a big disruption, otherwise it wrecks the finances of a hospital,” Gaston said. “Unfortunately, we’ve had a big disruption.”
Early national predictions were a 40 percent decline in gross charges for the first four months, some are saying 20 percent in the next 12 months, he said. While they don’t know what the exact figures will be, it will be significant and is a big challenge, Gaston said.
Gaston said that while they are developing a number of plans at the health system in order to be flexible, they do not want to furlough workers. There is not a plan to reduce staff, he said. That could result in the loss of highly skilled workers, and they might have to then hire more workers later. It would damage their business model, he said.
“I think it’s shortsighted to dismantle your workplace,” he said.
Sen. Moran, at the news conference, said the CARES Act set aside $100 billion to help health care providers in the nation, with $30 billion first for Medicare reimbursements, and $20 billion in the second payment for Medicaid reimbursements, in loans.
In the last week, $18 million in grants from Health and Human Services was allocated to high intensity COVID-19 hospitals in Kansas, and $82 million in grants to rural hospitals in Kansas, he said.
Also, city, county and district hospitals now are able to get a loan through the PPP program, he said. Originally these hospitals were not able to get this funding, he said. Sixty Kansas hospitals qualified by having less than 500 employees, but half of those were originally ineligible because they were city, county or district hospitals, and that has now been changed after he and others intervened, Sen. Moran said.
The unemployment rate hit 14.7 percent today, with 20.5 million people unemployed, according to figures from the U.S. Department of Labor, Sen. Moran said during the news conference.
Sen. Moran also said 100,000 medical masks have been donated to Kansas by Taiwan. The masks have the same quality and requirements as the U.S. medical masks, he said. He said a member of his staff was instrumental in helping to get this donation.
Dr. Dana Hawkinson, medical director of infection prevention and control at the KU Health System, said that COVID-19 patient numbers at the KU Health System on Friday were down, with 24 reported as compared to 26 on Thursday. Nine patients were in the intensive care unit. Four to five patients are being admitted per day, usually, and about the same number are being discharged. In all, there have been 120 patients discharged at KU Health System since the beginning of the COVID-19 pandemic.
Dr. Steve Stites, chief medical officer at the KU Health System, said there is a lot of collateral damage in COVID-19 from people not taking care of their health, from other conditions.
“Don’t be part of COVID collateral damage,” he said. Don’t be afraid to get help, he added.
Dr. Hawkinson encouraged patients to continue to discuss their medical conditions with their providers and to continue to treat chronic illnesses, so they don’t have emergencies.
Dr. Stites said the way to beat the pandemic is to wash your hands, don’t touch your face, cough into your elbow, don’t go out when sick, wear a mask and don’t ignore symptoms that would lead you to get health care.
To see the KU doctors’ news conference, visit https://www.facebook.com/kuhospital/videos/2634658273416069/.
The UG’s COVID-19 webpage is at https://alpha.wycokck.org/Coronavirus-COVID-19-Information.
The Wyandotte County reopening plan, a 41-page document, was posted Thursday, April 30, at https://www.wycokck.org/WycoKCK/media/Health-Department/Documents/Communicable%20Disease/COVID19/RestartWYCOGuidanceDocument043020.pdf.
The Kansas COVID-19 website is at https://covid.ks.gov/.
The Kansas COVID-19 resource page is at https://govstatus.egov.com/coronavirus
Information from the CDC is at https://www.cdc.gov/coronavirus/2019-nCoV/.