PORT ANGELES — Olympic Medical Center reported this week a smaller net loss in August than it had in July, as the public hospital district continued its plan of spending reductions and improved operational efficiencies after steep post-pandemic losses.
Chief Financial Officer Lorraine Cannon on Wednesday told hospital commissioners she considered the $872,000 it lost last month a great improvement over July’s $3.554 million loss and a sign that OMC is heading in the right direction in its financial recovery.
“I think that this is a really good representation of all the hard work we’ve been doing,” Cannon said. “So, while I’m not excited that it’s still a loss, if you think about it, we know where we need to continue to do some work.”
OMC lost $18.672 million through the first eight months of the year compared with the $16.062 million in all of 2022, according to a February 2023 auditors’ report.
In June, OMC implemented a three-phase cost-savings plan that included a hiring freeze on non-clinical positions; reductions in overtime; and no capital or office supply purchases. It also hired the consulting firm Advanced Operations Partners to advise it on strategic planning and operations management.
Reducing the number of contracted workers, also known as travelers, locum tenens had made a big impact on cost savings, Cannon said. During the pandemic, OMC came to rely on temporary staff that are far more expensive than permanent employees and it has been slowly trying to move away from that practice.
“Our traveler cost was $763,000 this month and in December of 2022 it was $1.1 million a month, and in 2023 for the first six months, it was basically also $1.1 million a month,” Cannon said. “Last month it was $ 774,000. That’s real progress.”
While OMC might be narrowing its losses, its revenues continued to be flat or falling. Outpatient revenue, in particular, had fallen due to decreased visits that Cannon said could partially be attributed to a shortage in clinical staff.
“It appears like we’ve done a phenomenal job in getting our expenses down. At the same time, we’re still losing a lot of money,” Commissioner Philip Giuntoli said. “My concern is that I don’t know that we can continue to focus on just the expense side.”
OMC was focused on improving revenues by, among other things, instituting some of Advanced Operations Partners’ suggestions, Cannon said.
“Revenue traditionally takes a little bit longer to make those changes,” Cannon said. “It’s easy for me to say you can’t buy any more pens. It’s not as easy for me to say, doctor go out and get more patients.”
At the end of August, OMC had 59 days of cash on hand, less than the 60 days required by KeyBank, which holds $60 million in OMC general obligation bonds. Commissioner Ann Marie Henninger asked Cannon if that posed any risks.
“We received an official notification that they’re not going to tender the bonds,” Cannon said. “We’ve been very open with KeyBank. We’re actually giving them monthly financial statements and monthly cash on hand. So, they’re aware of it and it’s not going to result in anything at this point.”
There is a mild surge of COVID-19 infections in Clallam County and across the state, Chief Medical Officer Scott Kennedy told the board. An increasing number of staff across OMC departments had tested positive for COVID and masking was being reinstated.
“Statewide hospitalization is rising and that’s always a concern partly because of COVID itself, but partly just because we know our hospitals are just busier than they’ve ever been,” Kennedy said. “I will say the rise that we’re seeing now is at a level that’s very low compared to the peaks that we’ve experienced in the past statewide.”
On Aug. 22, Kennedy said, 259 patients in Washington state were hospitalized, 14 of whom were on ventilators. A month later, on Sept. 29, the number of hospitalized increased to 336, 13 of whom were on respirators.
“What we don’t see is a huge rise of people going into severe disease on the ventilators and dying. When you compare it with the peak in January a year ago, it was 2,321,” Kennedy said. “So by comparison, we’re at a very low rate.”
Kennedy said an updated vaccine for COVID-19 would likely be available within the next two weeks.
Human Resources Director Heather Delplain reported that in August OMC had open positions for 180 clinical staff, including openings for 35 providers, 45 registered nurses, 10 certified nursing assistants and 21 medical assistants. Among the hires were six whose positions had previously been filled by travelers.
Reporter Paula Hunt can be reached at email@example.com.