Kaweah Delta Medical Center is facing a significant financial shortfall due to the coronavirus pandemic.
The Visalia hospital broke even for the first 10 months of the fiscal year but ended April with a $21.2 million operating loss, CEO Gary Herbst said in a message to the community on May 14.
“Many of you, our 5,000 employees and 700 members of the medical staff, have felt the impacts,” Herbst said. “We are doing everything we can to protect all of you from a safety and economic standpoint.”
Kaweah Delta has joined with other hospitals throughout California to ask California Gov. Gavin Newsom for $1 billion in financial assistance from the state’s budget.
Herbst said that the hospitals hope the state will also commit $3.1 billion from the U.S. Center for Medicare and Medicaid Services.
The south Valley hospital chief revealed that out of the hospital’s 5,000 employees, 400 of them are on a leave of absence, 1,100 are working with reduced hours and 140 employees have been furloughed.
“We know that COVID-19 has been financially devastating to our Kaweah Delta family,” Herbst said. Fortunately, we have good-hearted leaders and staff that have been able to set up an emergency employee relief fund through our foundation, which is helping supplement the loss of employee compensation.
Executives have taken sizable pay cuts, Herbst said, and directed that money to employees.
“We have talked about reforecasting our budget, and we have discussed layoffs,” Herbst said. “But fortunately we are not there yet, and we hope that we will never get there.”
The hospital has seen a sharp drop in the number of elective surgeries and emergency room visits during the pandemic, which make up a large part of Kaweah Delta’s revenue.
In a press conference on May 14, Herbst said Kaweah Delta had received $11.2 million in federal relief funding, stemming from the CARES Act, but the hospital is still running at a loss.
Kaweah Delta has reopened elective surgeries, but Herbst expects the hospital to be in a tough financial position at least through June.
“We do not know what the future holds for us, but we know that we will not be the hospital we have been in the past,” Herbst said. “There are many unknowns at this point. I want to reassure you that we are truly in this together, and we are doing everything we can for our Kaweah Delta family.
“I know this is a hard time for every one of us, and despite that, I marvel each day at all that our staff are doing to provide our community with excellence and compassion, as well as everything that our community is doing to support us.”