Rural Michigan hospitals gutted by coronavirus, even those without cases

The good news: There are few or no coronavirus cases in Upper Peninsula hospitals. The bad news: Hospitals still can’t perform the elective surgeries that keep their lights on. (Shutterstock)

Just like many urban hospitals in Michigan, the bottom line at Chippewa County War Memorial Hospital in Sault Ste. Marie has been slammed by COVID-19.

With a statewide hold on “non-essential” procedures by a March 10 executive order of Gov. Gretchen Whitmer, revenues plunged by $4 million in a month at the Upper Peninsula hospital. It laid off 140 of 900 workers.

 

“We may make it for three months,” hospital president & CEO David Jahn told Bridge Magazine. “If this continues for longer than three months, it’s going to be very difficult.”

The fiscal picture is much the same at Beaumont Health in southeast Michigan. Officials announced Tuesday it is laying off nearly 2,500 of 38,000 employees at its eight hospitals, citing falling revenue from elective surgeries and outpatient office visits as it shifted to COVID-19 care.

The big difference, though, is Beaumont Health has treated more than 6,300 coronavirus patients and had 614 COVID-19 deaths, as of Thursday.

Chippewa County War Memorial Hospital has yet to treat a single confirmed COVID-19 patient. As of Thursday, there have been 65 COVID-19 cases in the entire U.P.

Whitmer’s executive order was to assure that hospitals would be ready for COVID-19 by freeing up space, personal protective equipment and manpower normally dedicated to elective procedures like knee replacement and colonoscopy. With the crush of COVID-19 cases in southeast Michigan, that’s proven to be a crucial step for many overrun hospitals.

But some rural hospital officials question whether it’s smart to continue to bar rural hospitals from elective procedures – a lifeblood of hospital revenue – when they have few or no COVID-19 cases.

“It is true you can make a really good argument, why did the U.P. have to stop doing these [elective] cases [when] there’s no COVID-19 cases here.? A lot of our surgeons are saying, ‘Why can’t we do these cases? This is crazy,’” Jahn said.

Chippewa County War Memorial Hospital CEO David Jahn: “We may make it for three months.” (Courtesy photo)

In Iron Mountain along the U.P. border with Wisconsin, Dickinson County Healthcare System is struggling with identical fiscal woes.

Hospital president and CEO Chuck Nelson told Bridge hospital revenue fell by $3 million in March as it ceased elective procedures and outpatient office visits dried up, forcing it to trim 10 percent of its workforce of 600 employees.

To date, Nelson said, Dickinson County Memorial Hospital has treated three COVID-19 patients, two of whom died. As of Thursday, it had no COVID-19 patients.

“The reality is, we’re not seeing the number of [COVID-19] cases we were expecting. I would argue at this point, the U.P. is a pretty good place to consider opening things up,” Nelson said.

And while metro Detroit hospitals are running at 60 percent occupancy and treating more than 2,000 COVID-19 patients, hospitals in northern Michigan are treating just a few and overall occupancy is far lower. In the Upper Peninsula, just 27 percent of beds are currently occupied by any patient, according to new hospital data released on Thursday.

Bridge reached out to a spokesperson for Whitmer and asked whether the governor would consider allowing some rural hospitals with few COVID-19 cases to resume non-essential procedures.

Dickinson County Healthcare System CEO Chuck Nelson: “The reality is, we’re not seeing the number of [COVID-19] cases we were expecting.” (Courtesy photo)

Deputy Press Secretary Bobby Leddy replied in an email statement: “Governor Whitmer’s top priority is the health and safety of Michiganders. By postponing all non-essential medical procedures, we have reduced the strain on hospital systems and preserved critical PPE for health care professionals on the front lines of this crisis.”

Ruthanne Sudderth, spokesperson for the Michigan Health and Hospital Association, told Bridge that MHA “at this point” does not support any exemption for rural hospitals on the halt for non-essential procedures.

“It’s a very delicate balancing act to how we resume some degree of normalcy,” Sudderth said. “We want to assure we don’t have an outbreak in a community where we don’t have the resources to handle it.

“Even if it’s in the U.P., the [Mackinac Bridge] does not provide immunity,” Suddarth said. “For a hospital that has only four ICU beds, five cases is too many.”

Sudderth acknowledged that some rural hospitals have reached out to MHA to ask when they might get back to full hospital functions.

But one health analyst said it would make sense for the governor to begin to relax the halt on non-essential procedures at hospitals where COVID-19 is not an issue.

“In facilities where they don’t have high rates of COVID-19, I think there’s going to be some ability to be doing some of these procedures soon,” said Marianne-Udow Phillips, executive director of the Center for Health and Research Transformation at the University of Michigan.

Texas, Oklahoma and Alaska have already opened their hospitals to certain elective procedures put on hold because of COVID-19, following the release of new guidance from he White House last week.

Even before the COVID-19 outbreak, rural hospitals across Michigan faced financial pressures that threatened their ability to stay in business.

A 2019 national analysis by the Chicago-based national health care consulting firm Navigant found that 18 rural hospitals in Michigan were at high risk of closing – about one-fourth of rural hospitals in the state and ninth highest such percentage in the nation.

Rural Michigan hospitals continue to face demographic trends that eat at their bottom line. Counties throughout the U.P. and northern Lower Peninsula suffered population losses from 2010 through 2017.

According to 2019 U.S. Census data, 21 of Michigan’s 83 counties – all rural – have a median age of 50 or older, the highest in the nation.

Rural hospitals suffer other disadvantages that push down profit margins.

To stay competitive, they need diagnostic tools like CT and MRI scanners that can cost upward of $2 million each. But those machines get less use in rural hospitals than at busy urban hospitals – and thus less revenue to pay for their cost. Rural hospitals staff costly 24-hour emergency rooms that also chew away at their bottom line.

Amid the COVID-19 crisis, some federal funds are trickling down to rural hospitals to help keep them afloat. The $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act allocated $117 billion for hospitals and veterans’ health care.

Chippewa County War Memorial Hospital president and CEO Jahn said his hospital got about $3 million of those funds. But Jahn said part of that funding is tied to how many COVID-19 cases a hospital has had.

“I hope I’m wrong, but I don’t think we will get anything from that,” he said.

The U.P.’s Dickinson County Healthcare System has already survived a recent brush with insolvency. It was among the 18 at-risk Michigan hospitals in the 2019 Navigant report.

And as an independent hospital unaffiliated with a larger health care system, it does not have the luxury of outside help.

In 2018, the hospital board considered filing for bankruptcy protection, as total inpatient days tumbled 15 percent in just two years and revenue fell. It cut its workforce by more than a hundred employees and streamlined its operations.

By early 2020, Nelson told Bridge, its profit margins were “extremely good.”

That vanished with the pandemic.

“We are doing everything we can to conserve cash,” he said. “We are sitting there with a double whammy. We don’t have any COVID-19 patients and we can’t do any outpatient procedures.

“We’re in the sandwich.”

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Comments

Captain Obvious
Thu, 04/23/2020 - 10:11pm

CORRECTION: The hospitals were gutted by the governor, not by coronavirus.
Duh! Use some basic logic here guys!

Jim Pearson
Sat, 04/25/2020 - 10:59am

The stay-home order was sold by the Governor and bought by the public in order to flatten the curve. Mission achieved. Thankfully the virus wasn't anywhere near as deadly as we were sold and we bought. Now there is plenty of excess capacity in our hospitals. The time has come to end the stay-home order. Obviously safety measures need to be put in place to protect vulnerable populations and safety measures like masks and hand-washing should continue, but the stay-home order should end. It is causing massive economic damage and leading to increased deaths- those facts are undeniable- and now it isn't doing any good. It needs to end NOW.

Nutty
Fri, 04/24/2020 - 6:57am

These are the sad truths we will have to face. Using unproven they tell us hypothetical models of how these authoritarians have saved us or are saving us. Did they really? I would like our local hospital to be around after this. The services and morale in many hospital were already bad because there is no monies to pay employees. Now destroy the economy like our governor has done or as in other states, who can pay for even the deductibles in getting care? So it is going to be very dangerous position she put the rest of the citizens in trying to protect her voting block.

I guess I could be a democrat/lib/communist and just say thank you for all the great work that was done. I am waiting for Georgia to prove all these states a farce that have gone overboard. Let's see if all the dooms day predictions of the democrats and fake media comes true about Georgia. Or will Georgia be right like Sweden, this is no different than other flu and respiratory viruses and people have to take care of themselves and avoid getting sick and getting other people sick common sense. Unless you believe your own constituents are not smart enough people that you have to force them to do what you want them to.
Go check out world, US and Michigan covid stats of infections and death use a percentage calculator and population numbers and educate yourself. Check out stats on other causes of deaths. And the 1918 flu pandemic is not comparable which killed young and old healthy and unhealthy. The blathering nonsense is to much.

Trump even said some these states went way overboard and things they did were unnecessary. But it doesn't take an expert to see that.

Jim
Fri, 04/24/2020 - 8:59am

Will Georgia duplicate Sweden? Right now Albany, Georgia has one of the the highest rates of COVID.
https://www.businessinsider.com/coronavirus-hotspot-albany-georgia-funde...
"Albany, Georgia, is facing the fourth-worst outbreak of coronavirus per capita in the United States."

https://www.businessinsider.com/how-sweden-and-norway-handled-coronaviru...
"Sweden's controversial coronavirus strategy has led to nearly 10 times the number of deaths of the other Nordic countries — and it serves as a counterargument to US citizens calling for their country to reopen."

TJH
Fri, 04/24/2020 - 9:50am

You could have lead with "Trump even said" and saved us them time it took to read the rest of your comment. Trump also said he wanted to look into injecting disinfectants as a cure.

Like Em Nutty
Fri, 04/24/2020 - 8:58pm

Nutty, you may be right. According to the CDC, the total deaths in the U.S. from week 1 in 2020 through week 14, the last week for which the CDC has published full numbers, shows 772,085 total deaths. For the first 14 weeks of 2019, there were 809,704 deaths in the U.S. over the same time period last year. That’s right: through the first 14 weeks of the year, through April 3 or April 10, however the CDC counts the weeks, there were 37,619 fewer deaths this year than last, despite our supposedly being in the grip of the greatest health crisis since the Spanish flu.

This thing is smelling more and more fishy the deeper and deeper we get into it. And the more it looks like we got punked as a nation by this Chinese flu and guidance that we got from the WHO, the more and more liberal and progressive Democrats are digging in and doubling down on stupid.

Tonya
Fri, 04/24/2020 - 9:05am

If a patient has Covid-19 like symptoms and receives a diagnosis of : undetermined, it looks like the county has no cases and is 'safe' to open it's hospitals up to its regular revenue streams.
Saving lives or protecting revenue streams? We need more access to testing if we're being blocked because of money interests.

Anonymous
Fri, 04/24/2020 - 10:24am

The Governor's policies are causing hospitals and doctors to lose money and start making layoffs, reducing investments, and cutting safety measures. That's not going to be good for fighting this virus. Who are they going to blame when all these totally foreseeable unintended consequences hit?

Marilyn Loomis
Fri, 04/24/2020 - 1:47pm

The Governor should be able to multi task. There are more that 2 cities in Michigan.
There really is a bigger picture here!!!! If you can't do a better job get your own
wallet out. Why should other suffer from your ignorance? All of us Tax Payers are getting Slammed in all directions!!!! YOU OWE THE CITIZENS OF MICHIGAN AND THE UNITED STATES OF AMERICAN!!!!

Scott Roelofs (...
Sun, 04/26/2020 - 11:04am

Thank you Ted, for reporting on this tragic policy decision by the governor. Many of us saw from the beginning of this epidemic that the governor's "one size fits all" shotgun approach across the state was unwarranted and ill-advised.

The governor is so stubborn that she is unwilling to acknowledge this error and change course to open the hospitals and non-hospital surgery centers to routine surgeries.