DENVER, Colo. (CBS4) – Some of Colorado’s Critical Access Hospitals and Rural Health Clinics say they’re in dire need of help from the federal government. A number of these facilities are operating in the red, and unable to apply for the same forgivable loans as small businesses.
While rural facilities aren’t seeing close to the amount of COVID-19 patients that hospitals in the Denver Metro Area, some are feeling the financial effects of this pandemic. Many hospitals have put elective surgeries on hold, which are a major source of revenue.
At Melissa Memorial Hospital in Holyoke, interim CEO Cathy Harshbarger, estimated the break from elective surgeries has limited the ability to generate revenue by 70%. Recently, the hospital has furloughed almost 20% of its staff, reduced some shifts, and cut pay for executives and some providers.
“We just don’t have a lot of extra money to move around to be able to plan for this,” Harshbarger said. “In fact, when this started we were at about 32 days’ cash on hand. So literally, if you don’t do something right away, you risk losing your hospital.”
The Paycheck Protection Program’s forgivable loans, offered by the Small Business Administration, could’ve been a game changer for Melissa Memorial Hospital, but many small, rural facilities are ineligible because they receive some public funding. CBS News previously reported that about a third of hospitals have been rejected for PPP loans.
Another pot of money has been made available for health care providers in the CARES Act stimulus package. The Department of Health and Human Services recently allocated $100 billion to all providers who care for Medicare patients. Of the first $30 billion distributed, Melissa Memorial received about $300,000, Harshbarger tells CBS4.
“To give you an example, it costs about $350,000 a pay-period, every two weeks, to support our staff,” Harshbarger said. “So that essentially isn’t really even more than two weeks’ worth of pay.”
According to the Colorado Rural Health Association, 18 of 40 rural hospitals in Colorado were already operating in the red prior to the pandemic. Many situatoins have only been made worse by the limits on elective procedures, as well as steep drop offs in the volume of visitors.
“Our ER visits are down by about 50%, OR volume is down by probably 70%, and our clinic, our outpatient volume is down by over 80%,” said Jason Cleckler, CEO of Middle Park Health in Granby.
Recently, a bipartisan group of lawmakers, including Sen.s Cory Gardner and Michael Bennet, as well as Rep.s Joe Neguse, Scott Tipton, Ken Buck and Doug Lamborn, urged the Small Business Administration to ensure rural facilities aren’t left out again.
“Our Critical Access Hospitals and Rural Health Clinics play a vital role in providing care to rural communities,” Gardner said in a prepared statement. “Due to the COVID-19 pandemic, they are struggling with lost revenue and the costs of combating the public health emergency. I’ve secured an initial $361 million in assistance and $1.1 billion in Medicare Accelerated and Advance payments for Colorado hospitals through the CARES Act, and I’m going to keep fighting to ensure that rural hospitals are able to leverage Small Business Administration programs intended to help keep businesses, including health care providers, afloat.”
On Tuesday, the Senate passed another relief package, worth roughly $484 billion, aimed at easing the economic effects of the pandemic. According to Bennet’s office, a technical fix regarding the PPP issue for Critical Access Hospitals and Rural Health Clinics was not included.
The deal does include $225 million in funding for Rural Health Clinics, which could provide some relief. According to Bennet’s office, the funds will be allocated for COVID-19 testing and related expenses, as well as construction of temporary structures, leasing of properties, and retrofitting facilities as necessary to support testing.
“We really believe that the senators here in the state of Colorado are supporting us and economists are supporting us at the federal level, but if they don’t bring us that funding we really could lose our abilities to regain the business that we built so our communities have the support that they need, but it could also bankrupt hospitals like ourselves,” Harshbarger said.
While his hospital in Granby is not operating in the red right now, Cleckler tells CBS4 he has “significant concerns” about rural facilities not being involved in either wave of funding for the SBA program.
“This will put some rural hospitals in a very difficult place, as far as their ability to continue operating,” said Cleckler. “Rural hospitals are critical to the health and well-being of our rural communities. They are also critical to the economic development and economic opportunities in those communities, whether you’re talking about the eastern plains, mountain communities, or western slope.”