Hospital now feeling effects of pandemicFree Access

According to numbers released during last week’s John C. Fremont Healthcare District financial board meeting, the district has been hit hard by the Covid-19 pandemic.

“It’s massive losses happening right now,” said JCF Chief Executive Officer Matthew Matthiessen.

The month of March’s net loss in revenue alone was $488,000 to the district.

“In the middle of March, we started seeing volumes drop, and by the last week of March, they were very low, to about the level they’ve continued at through April, which is between a third and 50 percent off, depending on the department,” Matthiessen said.

That trend is only expected to continue.

“We’re going to be over $1 million below budget in charges in the month of April,” said Matthiessen.

In addition, the district normally receives money tied to sales tax generated in the county. That money is tied to a bond which was passed over a decade ago. But with sales down across the county due to stay-at-home orders, Matthiessen expects the sales tax revenue to be down drastically.

“The sales tax we currently get, that was back in 2005 or around there, when it was approved to cover a bond that was issued back then. Sales tax is used to cover that bond. Every month I’ve been here, it’s covered that bond,” Matthiessen said. “I’m thinking in May, it will be the first month we don’t see that, and we’ll actually have to pay money out of our cash reserves to cover that bond. It hurts us. It means we’re receiving less and paying more.”

With all of that said, Matthiessen is staying optimistic.

“It’s not like we’re not doing any business right now. We might be down a third or 40 percent, in some cases 50 percent. But there is still some revenue that generates some reimbursements so we have cash coming through the door and it’s not just all going out,” he said.

Matthiessen said the hospital entered the start of the pandemic “with about 100 days of cash” in the bank.

“We can weather a very rough storm, and this is a rough one. But we’re in great shape; probably better shape than most hospitals in the state of California,” he said.

He also said the district “has done a fantastic job of watching after its financials, watching after its cash over the last four or five years,” which is helping it now.

“From a financial perspective, even though things are terrible right now and it is unbelievably difficult financially right now, we have the reserves. We have prepared for this and we will survive this. We will be okay. The community will continue to have a hospital and an emergency room they can come to, if they need us,” Matthiessen said.

Matthiessen said a number of measures have been taken to save money for the district. Matthiessen has slashed his salary by 20 percent, and the chief financial officer has also voluntarily taken a 10 percent reduction in pay.

Additionally, hours of certain departments at the hospital have been reduced, including in the imaging department, in an effort to save money.

Matthiessen said some employees have had to be furloughed, but the goal was to, in a sense, accommodate those employees who had children home now due to the pandemic, and who would actually end up in some cases saving money by being furloughed at home, instead of having to spend on childcare costs.

Those employees will continue to receive health benefits, Matthiessen said, even while they are furloughed.

How will pandemic affect ballot measure?

Hospital officials are planning to add a ballot measure to the November ballot that would help pay for a new hospital facility. This measure would seek a 1 percent increase in sales tax in Mariposa County.

“The unfortunate thing is that no matter how good we do with our financials, we’re too small to ever be able to generate the finances to build a new hospital on our own. So we do need that community assistance to help us with that,” Matthiessen said.

A new hospital is needed because by law, hospitals across the state must meet certain earthquake proofing requirements found in SB1953 — the Hospital Seismic Safety Act — by the year 2030. JCF officials have been hoping to construct a new hospital to meet those requirements, as the hospital is currently not in compliance.

If JCF doesn’t meet those requirements by the 2030 deadline, the state will “red-tag” the hospital, effectively shutting it down.

Matthiessen has stated previously that the 1 percent sales tax increase, in addition to the strong financial performance of the district over the last few years, would cover the cost of building a new hospital.

But will that change with the way Covid-19 is affecting not just the hospital, but the community?

“How this (Covid-19) pertains to November, I’m not really sure,” Matthiessen said.

It is unclear how the community — which will be hurting from the pandemic — will vote for a measure seeking funding.

Matthiessen said what he can project is that “financially, we’ll be okay to that point” (in November).

“But what I hope the community realizes is that even though the community hasn’t had to use us for actual Covid-19 cases, that if that situation were to realize itself, that we are here for them,” Matthiessen said. “Without us, they would have to go somewhere else for that and put them and their loved ones potentially at greater risk by going into another community and getting an infection they didn’t already have. I hope the community recognizes that, and that we are doing our best to be here for them now and into the future.”

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