Furloughs – How Did We Get Here?

By Joseph J. Gurrieri RHIA, CHP, President and COO

Medical workers outside of Mount Sinai Hospital in New York City. Photo courtesy of GETTY IMAGES

U.S. hospitals are predicted to lose more than $200 billion in revenue by June 30, according to a report by the American Hospital Association. The industry group estimates the total revenue hit from the pandemic at about $50 billion a month among healthcare facilities since March.

“America’s hospitals and health systems have stepped up in heroic and unprecedented ways to meet the challenges caused by COVID-19. However, the fight against this virus has created the greatest financial crisis in history for hospitals and health systems.”

Rick Pollack, President and CEO, American Hospital Association

Pay Cuts and Revenue Dips

According to MarketWatch, the Mayo Clinic, which runs 23 hospitals around the country, is among the troubled institutions. It expects to lose $3 billion in revenue in 2020 after governors in Arizona, Florida and Minnesota, where most of Mayo’s facilities are located, ordered all non-essential surgeries postponed in mid-March.

In April, Mayo announced extensive pay cuts and staff furloughs. The staff furloughs at Mayo and nationwide are tied to canceled and postponed elective surgeries. Many U.S. hospitals and health systems have suspended elective procedures to save capacity, supplies and staff to treat COVID-19 patients.

These non-emergent procedures—scheduled operations such as joint replacements, tumor removals and cardiac surgeries—comprise an average of 48% of all hospital income, according to experts. As a result of suspending these procedures, several systems have lost or expect to lose a large chunk of their annual revenue, forcing them to make cost reduction a top priority.

Here is a breakdown from Becker’s of the hospitals that have furloughed staff in an effort to remain financially stable amid the COVID-19 pandemic.

To put the postponed surgeries and furloughs into perspective, 1.4 million healthcare workers lost their jobs in April.

The healthcare workers left standing are over worked and stressed beyond measure from taking on new responsibilities.

According to npr.org, Palomar Health in North San Diego County in California eliminated over 300 positions. But the workload didn’t change. It just shifted to people like Sue Phillips, a critical care trauma and rapid response nurse.

“We have very limited physical therapy, speech therapy, and occupational therapy. That’s part of our care team, so that’s now going to fall onto our end to provide that care,” she said. “It’s uncharted territory. In my 25 years of nursing, I’ve never seen anything like this before.”

What About HIM?

We hear stories in the mainstream media about healthcare workers on the front lines being exhausted, but how about the people behind the scenes? HIM and coding teams are also faced with skeleton crews. Coders are being cross-trained in CDI. Inpatient coders are working outpatient telehealth cases. It’s survival mode.

But with elective surgeries opening back up across the country, and in New York as of May, the hope is that healthcare workers’ jobs will also open back up. This includes our beloved coding community.

Stay tuned for our next post on Elective Surgeries – Where Are We Now?