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Metro Health implements 12-week voluntary furloughs in response to estimated $40M operating loss COURTESY PHOTO

Metro Health implements 12-week voluntary furloughs in response to estimated $40M operating loss

BY Wednesday, May 06, 2020 04:58pm

WYOMING — Metro Health-University of Michigan Health System will start voluntary staff furloughs next week in response to the “lasting” financial consequences of the COVID-19 pandemic.

The health system has offered voluntary leaves of absence for employees “who would like to be considered for a 12-week voluntary furlough program,” CEO Peter Hahn said in a statement to MiBiz. Employees will continue to receive health benefits during their leave.

In seeking employees to take a furlough, Metro Health joins other health systems — including Spectrum Health, Mercy Health and Bronson Healthcare in West Michigan — that have moved to cut expenses after weeks of losing revenue following an executive order from Gov. Gretchen Whitmer in March that has prevented them from performing elective, non-essential procedures and surgeries.

Metro Health said it projects a $40 million operating loss through the 2020 fiscal year that ends June 30.

“Metro Health has conducted a system-wide financial review that includes core operations, service lines, facilities and staffing levels. The reality is that the current COVID-19 crisis will have lasting implications on health care resulting in material and fundamental changes in how health care systems like Metro Health will operate,” Hahn said. “Our employees are aware of the need to make additional staffing changes in the weeks to come, as we make adjustments to support organizational needs moving forward.

“We continue to evaluate on an ongoing basis and will continue to make necessary shifts in our operations to help us best navigate the financial challenges of COVID-19 and the post-COVID-19 health care landscape.”

Hahn expects the move to affect less than 10 percent of Metro’s workforce of nearly 3,000 employees.

If Metro Health does not get enough employees to take a temporary leave, then “we would move into mandatory furloughs,” a spokesperson said.

Metro Health is also reducing executives’ pay up to 40 percent starting this month and won’t make an annual discretionary contribution to employee retirement accounts.

On Tuesday, the University of Michigan Health System said it projects financial losses of $230 million for the 2020 fiscal year that ends June 30 at Michigan Medicine Inc., its academic medical center in Ann Arbor. Michigan Medicine planned to implement furloughs and layoffs for about 1,400 full-time employees and institute a hiring freeze that will leave 300 vacancies unfilled. Executives are also taking pay cuts.

The American Hospital Association estimates that U.S. hospitals between March 1 and June 30 will lose a collective $202.6 billion.

That estimate includes $161.4 million in revenue lost over four months from not performing elective surgeries and procedures because of stay-at-home orders in several states, and people deferring care during the pandemic or not seeking emergency care when needed. The estimate also takes into account the cost to treat COVID-19 patients, add temporary capacity and locations to test people with symptoms, and a $2.4 billion price tag for personal protection equipment for staff.

“Hospitals and health systems face catastrophic financial challenges in light of the COVID-19 pandemic,” according to the AHA report. “Although the federal government moved quickly to provide relief, more help is needed. Critics have argued that hospitals were well funded prior to the COVID-19 public health emergency, however, the reality is that many hospitals were already facing financial pressures.”

Gov. Whitmer’s March 20 executive order that put restrictions on non-essential medical and dental procedures was meant to enable health systems to redeploy staff to respond to the pandemic, ensure that they had adequate bed capacity and enough needed personal protection equipment.

The executive order gives hospitals “broad discretion” in deciding what’s essential and non-essential for a patient, said Dr. Joneigh Khaldun, chief medical executive at the Michigan Department of Health and Human Services. Updated guidelines the department issued May 3 “should assist in determining the best way to treat patients without delaying needed medical services,” Khaldun said.

“We hope this guidance helps answer questions but recognize it is not a substitute for clinical judgement,” she said in a statement on Monday. “Providers know their patients best and will understand the safest, most effective ways to manage their care under these circumstances created by the pandemic.”

Holland Hospital and Mercy Health both say they plan to resume surgeries and endoscopic procedures.

Decisions on rescheduling surgeries or procedures “will be at the discretion of the surgeon and the patient,” according to Holland Hospital.

“The decision to expand surgeries is based on our ability to safely care for each patient and protect our staff with high-quality personal protective equipment and safety procedures as well as our ability to respond to a health crisis if needed,” said Dr. Susan Ervine, chief of staff at Holland Hospital that will "gradually" resume surgeries and procedures.

Mercy Health said today it was resuming select surgeries and medical services. Mercy Health planned a “phased reopening approach” that focuses on “addressing health conditions that may not be imminently life threatening but will result in overall worsening of the patient’s health and well-being if not addressed within the coming month.”

The essential procedures that Mercy Health plans to resume include cancer surgery, vascular bypass, and diagnostic procedures “for which further delay carries significant risk of harm to patients,” the health system said.

“For the health, safety and welfare of our patients, whose care has been deferred during the initial weeks of the COVID-19 crisis, we are developing a clear pathway to begin safely performing time-sensitive procedures while we also continue to care for COVID-19 patients in the months to come," said Dr. Rosalie Tocco-Bradley, chief clinical officer for Trinity Health Michigan that includes Mercy Health in West Michigan and Saint Joseph Mercy Health System in the Detroit area.

North Ottawa Community Hospital in Grand Haven said as well today that it resumed “time-sensitive” surgeries and procedures this week for priority cases. North Ottawa said it’s now at 50 percent of normal surgical capacity for gynecological, cataract and a variety of general surgeries such as hernia repair. Sleep lab tests, pulmonary function tests, and diagnostic endoscopy cases will resume next week, “also limited to roughly 50 percent capacity for the time being,” according to a statement.

“We established a clinical review committee that’s been conferring with surgeons to identify patients with worsening conditions in need intervention,” said Cindy VanKampen, North Ottawa’s chief compliance officer. “New safeguards include spacing out the number of cases per day for more stringent infection control and limited exposure, retrofitted one operating room with negative pressure designated for COVID-19 positive emergency cases, and testing every patient prior to surgery. Patients who test positive may be asked to postpone, if circumstances allow.”

As of Wednesday, Michigan had recorded 45,054 confirmed cases of COVID-19 and 4,250 deaths. That’s up 657 cases from Tuesday and 71 deaths.

In West Michigan, Kent County had 2,016 confirmed COVID-19 cases as of Wednesday, an increase of 102 cases from the day before, and neighboring Ottawa County had 313 cases, up from 295 on Tuesday.

There were 355 confirmed cases in Muskegon County as of Wednesday, compared to 295 on Tuesday.

Kalamazoo County had 539 COVID-19 cases, up by 50 from a day earlier.

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EDITOR’S NOTE: This story has been updated to add that Mercy Health and North Ottawa Community Hospital announced today they were restarting some surgeries and procedures. 

Read 4992 times Last modified on Thursday, 07 May 2020 12:57
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