Northfield Hospital and Clinics lost more than $1.2 million in operating revenue last month due to the elimination of elective surgeries as hospitals combat COVID-19.

NH+C Chief Operating Officer Jerry Ehn presented last month’s financial report Thursday during a Hospital Board meeting.

To combat that loss, the hospital recognized $1.4 million in other revenue from federal COVID-19 grants. NH+C did make $1.6 million in investment gains.

Net operating revenue was more than $2 million under budget, while gross revenue was $8.7 million under. Operating expenses were $719,000 under budget, while salaries were $104,000 under. Supplies were $282,000 under, while other expenses were $147,000 under budget.

Last month, nursing homes, hospice visits and births were over budget. At the same time, inpatient days, outpatient services, clinic, Emergency Department visits, surgery and endometrial procedures were all significantly under budget.

NH+C has instituted salary reductions for leaders during the pandemic, which is expected to continue due to the revenue losses.

The health system has received approximately $8 million from state and federal grants during COVID-19.

COVID-19 worries have kept patients away from doctors’ offices across the country and forced the postponement and cancellation of non-urgent surgeries. The pandemic also has shut down large portions of the economy, leaving many would-be patients without insurance or in a financial pinch that’s led many to curb spending.

NH+C CEO and President Steve Underdahl noted Thursday that ICU bed use has been teetering at record highs, hovering around 240. He expressed concern over people sometimes disregarding social distancing to have parties and other events, which has been recommended to help stop the spread of the novel coronavirus.

To Underdahl, COVID-19 remains a public health danger and officials need to be able to open or dial back the economy to address the crisis as circumstances dictate. He expressed concern, however, that as businesses and society continue to reopen, people will be less willing to have restrictions reinstated.

Northfield Hospital and Clinics is slowly reopening its facilities as patients express varying comfort levels with undergoing surgery. Faribault, Lonsdale and Lakeville clinics have all either opened, reinstated their former schedules or are expected to in the coming weeks. The Express Clinic remains closed. The Lonsdale clinic is set to open in late June.

Underdahl said despite anxiety from some that NH+C won’t survive the pandemic, he expects it will.

“We will have a really crummy 2020, but we are in really good shape from a macro perspective to survive and thrive in the future,” Underdahl said.

Health care provided the biggest drag on the U.S. economy in the first quarter of this year. Spending on care fell at an annual rate of 18%, the largest drop for that sector going back to 1959. Economists point to hospital systems, a key driver of the sector’s performance, as a big reason behind the drag from COVID-19, which initially hit some parts of the sector more intensely than others.

The nation’s largest hospital chain, HCA Healthcare, said its hospital-based outpatient surgery totals for last month were down about 70% through late April.

In many cases, hospitals that lose those profitable surgeries are gaining COVID-19 patients — and losing money in doing so. Those patients may require hospitals to expand intensive care units, spend more on infection control and stock up on gowns and masks, among other items. The American Hospital Association estimated in a recent report that the nation’s hospitals and health systems will collectively lose more than $36 billion from March to June due to treating hospitalized COVID-19 patients.

When adding factors like lost revenue from postponed surgeries, the total balloons to more than $200 billion, said the association. Congress has set aside about $175 billion so far to help hospitals and other care providers, but the hospital association says more assistance is needed.

“We’re facing perhaps the biggest financial crisis in our history,” association CEO and president Rick Pollack said.

The Associated Press contributed to this report.

Reach Associate Editor Sam Wilmes at 507-645-1115. © Copyright 2020 APG Media of Southern Minnesota. All rights reserved.

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