Health care organizations struggling as COVID wanes
In a month that we celebrate President’s Day and the advancement of equity via recognition of Black History month and Women Physician’s Day, we are also reminded of the current fragility of the health care industry, especially in support of rural health equity, as news broke earlier this month that another rural hospital in California was on the precipice of closure.
Imperial County’s largest hospital, El Centro Regional Medical Center, is projected to run out of funds to remain open by the end of March. This 300-bed hospital serves 180,000 people in a geographically rural and isolated part of Southern California and could become the latest in a sobering list of rural hospitals to close. Since 2005, 186 rural hospitals have shuttered according to a recent analysis by the University of North Carolina, with 21 closures in 2020 alone reported by Becker’s Hospital Review.
The plight of El Centro is a cautionary tale for other rural and remote communities across California and the U.S. Overwhelmed by the financial trauma caused by COVID-19, skyrocketing traveling labor costs, increases in pharmacy costs, global supply chain disruption, and significant escalation in the inflation impacting the cost of hospital construction and repairs, hospitals everywhere — rural or not — are facing financial headwinds that are unprecedented, leading some to have to make incredibly hard decisions regarding the sustainability of programs and services, and in the case of El Centro, potentially shutting down.
According to the American Hospital Association, expenses for U.S, hospitals increased by $135 billion in 2022 from 2021. Additionally, all hospitals in California are grappling with the looming unfunded 2030 seismic requirements estimated to cost between $34 billion to $143 billion according to the analysis conducted by the RAND Corporation in 2019. These estimates were prior to the escalation in costs following the pandemic. Rural and urban hospitals alike, particularly in California, are facing financial headwinds that are unprecedented in modern healthcare history.
Much like the earthquake we faced together as a community only a few short weeks ago, the health care industry has also experienced a significant seismic shock caused by the multiyear global pandemic. And while the initial shocks have subsided, all health care organizations are now faced with the destructive impact and the long journey of damage recovery that many within our very own North Coast community are all too familiar with.
Although much of the news concerning rural health care and rural health equity is cause for reflection given the financial impact on communities like ours, there is much to be celebrated in each success we have together in advancing health care access in the face of such significant adversity. The esteemed author, educator, and presidential advisor Booker T. Washington once shared, “Success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome.” This message reminds us of just how precious each step of progress we make together as we navigate the challenging road of recovery ahead and the importance of celebrating together along the way.
One great example of progress is we recently announced to our caregivers that construction will restart on the acute rehabilitation unit (ARU) at Redwood Memorial Hospital, a service that is vital for patients recovering from traumatic accidents, strokes, cardiac events and more. As some might be aware, there was a California Assembly bill passed years ago necessitating that we find a new home for this unit due to seismic upgrade requirements from the state. This project to relocate from General Hospital in Eureka and to build a brand-new ARU in Fortuna has gone through many “twists and turns” since its inception, most recently having been paused throughout the course of the pandemic.
During this time, skyrocketing costs of construction and materials has dramatically impacted the timeline and cost of this project, which was originally anticipated to cost around $8 million. Recognizing the critical importance of equitable access to these immensely beneficial services to our community, our Providence leadership team has been on a mission the last several months to work with internal and external stakeholders to restart this initiative allowing us to sustainably maintain access to acute rehabilitation services for many years to come.
While there were, and are, immense headwinds faced, we’re thrilled to celebrate this investment with our community (approximated at more than $20 million now) and share our gratitude for all who helped us take this meaningful step forward towards ensuring equitable health access for all along the North Coast. As Booker T. Washington suggests, we look forward to celebrating the obstacles overcome and will rejoice in our shared success together.