Rutland Regional Hospital expects an operating loss of $ 7.6 million due to Covid-19
Rutland Regional Hospital expects an operating loss of $ 7.6 million due to Covid-19

Rutland Regional Hospital expects an operating loss of $ 7.6 million due to Covid-19

Rutland Regional Medical Center sign
Rutland Regional Medical Center. Photo by Mike Dougherty / VTDigger

Vermont is at the end of its most potent Covid-19 wave to date, but the economic consequences of the pandemic continue to put pressure on state hospitals.

The latest budget pressure point will be on display this week when executives from Vermont’s second-largest hospital ask state regulators to allow a 9% increase in service fees on commercial insurance companies – on top of the 3.6% regulators approved at the beginning of the fiscal year.

Rutland Regional Medical Center executives say inflation and rising staff costs will cause an expected operating loss of $ 7.6 million in the current fiscal year.

Rutland Regional CEO and President Claudio Fort outlined the situation in a March 11 letter to the Green Mountain Care Board. Fort warned of painful cuts in necessary clinical services if the board rejects the hospital’s request. But if the care board approves the request at Thursday’s hearing, people with business insurance could face hefty insurance premiums next year.

The medical center in Rutland is not alone. Hospitals across the state spend more money than expected on travel staff – temps whose pay rates are two to three times higher than full-time employees. At the same time, burnt-out permanent employees are resigning to become travelers themselves.

“We do not currently have a contingency plan in place if our request is denied,” Fort said in his letter. Fort warned of painful cuts in necessary clinical services if the board rejects the request.

The hospital’s balance sheet appears to contradict the grim assessment: Rutland Regional reported a reserve of more than $ 260 million in the fiscal year ending September 30, 2021, according to applications to the Green Mountain Care Board. In an email Wednesday afternoon, Kevin Robinson, Rutland’s regional spokesman, declined to comment on the hospital’s request or reservation.

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Members of the Green Mountain Care Board cannot comment on specific hearings in advance, but Chairman Kevin Mullin acknowledged the current dilemma. The state’s shortage of labor creates a kind of death spiral in which hospitals compete for an ever-decreasing pool of workers at a much higher price.

Hospitals need more money and they can not adjust Medicare and Medicaid rates so they balance their budgets by raising the cost of care for patients with private health insurance.

But beyond a certain point, patients experience that they can not afford care, a problem that some privately insured Vermonters are already facing. These Vermonters are likely to see their premiums increase over the next few years, unless federal and state governments offer additional support, according to Mullin.

“I think if we all work together, we will find a way out,” he said, “but it will not come without pain. There will be pain in the form of higher rates in the next few years.”

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