Olympic Medical Center aims to refinance bonds

Published 1:30 am Thursday, March 5, 2026

PORT ANGELES — Olympic Medical Center will need to refinance about $42 million in outstanding bonds before two issues come due later this year, the board of commissioners learned.

Interim Chief Financial Officer Dennis Stillman said Wednesday the hospital is working with an investment banking firm to prepare for issuing new bonds, a process expected to take four to six months.

Stillman also reported the hospital had about 26 days of cash on hand in January, fewer than the 60 days required under its current bond covenants. He said the lower balance reflects several large quarterly payments made early in the year and is expected to improve as reimbursements arrive later in the quarter.

The hospital’s operating cash flow was negative 4.2 percent in January, compared with negative 2.8 percent in December. For 2025 overall, the hospital finished about 2.1 percent positive, meaning it brought in more cash than it spent even though it posted an overall operating loss.

Stillman estimated the hospital recorded about $13 million in operating losses in 2025, although the final number will not be known until an audit is completed.

Accounts payable totaled about $25.7 million, including roughly $4 million that is considered overdue. Stillman said improving cash flow would allow the hospital to begin reducing that balance.

Commissioners also received an update on the hospital’s compliance program from consultants Debbie Troklus and Sheryl Vacca, who have been assisting the hospital for about a year and a half.

Troklus said the consultants reviewed federal compliance requirements and the hospital’s risk assessment, identifying documentation accuracy, data privacy and cybersecurity as its highest risk areas.

“A lot of it was structure, a lot of it just getting everything in place,” Troklus said. “I know a lot of these efforts have been because of other reasons, but they really have been focusing on where the gaps are, fixing the weaknesses and moving forward.”

Hospital leaders said they are in the process of hiring a permanent compliance officer to oversee the program.

Vacca said cybersecurity remains one of the biggest risks facing health systems.

“We are being hacked,” she said, noting that attempted intrusions are routinely blocked by the OMC security team.

UW Medicine

CEO Mark Gregson briefed commissioners on ongoing discussions with the UW Medicine, including an agreement to begin assessing potential virtual services, with meetings scheduled this week to begin outlining next steps.

He said OMC also is working to schedule a visit from UW Medicine leadership to meet with commissioners.

As part of the letter of intent between the two systems, health care consulting firm Kaufman Hall will conduct an intensive review of OMC’s operations, similar to a due-diligence process, to give UW Medicine leadership a clear understanding of the hospital’s current position.

In other business, commissioners approved several administrative resolutions, including updates to the hospital’s conflict-of-interest policy and its annual compliance work plan.

At the beginning of the meeting, Nancy Field was sworn in to fill the unexpired Position 3 term of the late John Nutter. Field was appointed to the seat by commissioners at their Feb. 25 meeting.

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Reporter Paula Hunt can be reached by email at paula.hunt@peninsuladailynews.com.