PORT ANGELES — Olympic Medical Center commissioners on Wednesday approved a 2026 budget projecting a $7.4 million loss and a $3.2 million capital plan, while also voting to keep the hospital district’s property-tax levy flat next year. Both decisions passed on 4–2 votes.
Interim Chief Financial Officer Dennis Stillman said the budget was essentially unchanged from the version presented at earlier finance and board meetings. It projected modest volume growth but another year of operating losses.
Stillman said the plan assumed no major shifts in payor or service mix, and that hiring permanent executives in 2026 — a CEO, CFO and chief nursing officer — would be largely cost-neutral compared with the current slate of interim leaders.
Interim CEO Mark Gregson said OMC’s financial strategy depended on daily scrutiny of staffing levels, closer alignment between labor hours and patient volume and reducing reliance on contract labor.
He described a new department-by-department operations reviews, expanded employee forums and a forthcoming dashboard that will give staff and commissioners real-time performance data. Gregson said the goal was to stabilize operations, emphasizing that change was essential to reversing years of financial difficulty.
Commissioners expressed unease about sustained deficits, but ultimately agreed to the negative budget.
Commissioner Thom Hightower said that while he initially had reservations about the plan, discussions with Stillman and Gregson persuaded him it was “a starting point” for healthier finances.
“My expectation will be, from them and from the staff, that we see continued improvement as we move forward in this fiscal year,” he said.
Commissioners Phil Giuntoli and Penney Sanders said they could not justify approving a budget that represented another year of losses.
“I appreciate the assumptions that have been made to support the budget,” Sanders said. “But I have real reservations about a deficit budget.”
Commissioner John Nutter said he shared their concerns, but called the budget a necessary step toward long-term financial stability.
“I don’t like it, but I think we have to look at where we are today and how we get from A to point B,” he said.
“I am far more interested in having departments that are held accountable to their budgets, because we have blown budgets out of the water for more years than I’d like to count. So, I can personally live with a negative budget. It’s turning the ship, it’s starting to head in the right direction.”
Board president Ann Henninger, commissioners Hightower, Jean Hordyk and Nutter voted to approve the budget resolution; commissioners Sanders and Phil Giuntoli were opposed.
Under the approved levy resolution, OMC will hold its 2026 rate to 0 percent — collecting about the same revenue of $11.8 million as it did for 2025.
Nutter said he did not learn until the meeting that the levy rate would remain unchanged. He wanted an opportunity for further discussion, but OMC had essentially run out of time to meet county and state deadlines, making it impossible to table the measure.
“I think we should be taking the 1 percent that is allowed by law,” Nutter said. “We are foolish to leave money on the table.”
He added, “We have a very high burden of property taxes and I’m not in favor of more, but we are also serving our community and the costs for providing services to our constituents are going up way more than 1 percent.”
Giuntoli, Henninger, Hightower and Sanders supported the resolution; Hordyk and Nutter opposed it.
Henninger recommended next year’s levy discussion begin earlier to allow more board review.
Chief Medical Officer Dr. Scott Kennedy presented a review of OMC’s three- out of five-star Centers for Medicare and Medicaid Services rating, noting it reflected older data rather than current performance. The rating incorporated sepsis care, maternal outcomes, readmissions, complications, infections and patient-experience scores. OMC trailed national averages in several areas but exceeded them in health equity screening and some imaging measures.
Kennedy said the hospital was shifting to monthly, real-time data through a new dashboard to support better documentation and progress toward “zero” preventable harm.
Community members have been urging the board to record its meetings and post them online. It had considered the idea but recently decided against it. During public comment, speakers pressed commissioners to reverse their decision, saying the absence of an official record undermined transparency at a time when the hospital was working to rebuild public trust.
During public comment Wednesday, Port Angeles resident Nancy Stephanz noted that recordings were widely watched during the pandemic.
Dr. Joshua Jones, OMC’s former Chief Physician Officer, said the hospital — and Clallam County governments more broadly — faced “a crisis of confidence” linked to concerns about transparency.
“You do not get enough credit for the good that you do, and shoulder responsibility for matters far beyond your control,” Jones said. “That’s why when I see you make an unforced error, I feel compelled to respectfully ask that you reconsider.”
He said many OMC medical staff couldn’t attend midday or evening board meetings, making recordings essential for internal communication as well as public accountability.
Jones also pushed back on board’s concern about recordings being manipulated for nefarious means.
“That train has left the station,” he said. “Anyone with a still image of you can make it do and say anything they want with nothing more than an internet connection.”
Tara Coffin, who was defeated in her run for a board seat in the Nov. 4 general election, said OMC shouldn’t consider meeting recordings a liability.
“Rather, it is an opportunity to lead with transparency,” she said.
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Reporter Paula Hunt can be reached by email at paula.hunt@peninsuladailynews.com
