UVM Health Network projects $152 million loss due to COVID-19
The University of Vermont Health Network expects to lose $152 million this fiscal year because of the coronavirus crisis.
Porter Medical Center in Middlebury is a member of the network.
The UVM Health Network outlined a series of steps to fill the gap Friday, including reducing salaries and eliminating retirement benefits for leadership, freezing new hiring, reducing doctors’ pay, and halting new capital projects.
Those measures will save $25 million for the network, which is composed of UVM Medical Center and five other hospitals in New York and Vermont.
In a release, Health Network CEO John Brumsted praised his staff’s response to COVID-19. “Now we must confront the harsh financial realities that this situation has had on our organization, which means terribly difficult decisions that have a direct impact on our co-workers and their families,” he said.
Vermont hasn’t experienced a flood of COVID-19 patients that officials had feared, but the virus has incurred a deep financial toll on hospitals. The state’s hospitals are collectively losing about $100 million a month, a revenue decrease of between 40% and 80%, according to Jeff Tieman, president and CEO of the Vermont Association of Hospitals and Health Systems.
On Wednesday, Northwestern Medical Center also requested a 15% rate increase from the Green Mountain Care Board to help address its budget shortfall.
The Health Network attributed its losses to the pandemic. It has canceled all elective procedures and appointments since March 17. Earlier this month, the hospital staff outfitted UVM’s Patrick Gym to care for up to 100 COVID-19 patients. That space has not been needed, even as health officials have said the number of coronavirus infections has already peaked.
It has also created new testing facilities, stopped collection of unpaid patient bills, and provided an extra week of pay for employees earning less than $99,000 a year. Health Network leadership also reorganized staff, laid off some employees, and reduced hours and pay for others.
Those measures cost a total of more than $20 million, according to the network. The network also saw a 50% reduction in care and reported a loss of $44 million in March alone.
The network also received $37.9 million in federal government funding that will offset the losses.
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