An Important Message From CEO: COVID-19's Financial Impact

As you know, Kaweah Delta, along with other hospitals statewide, has suffered short-term and significant financial losses as a result of COVID-19. Many of you, our 5,000 employees and 700 members of the Medical Staff, have felt the impacts. We are doing everything we can to protect all of you from a safety and economic standpoint.

That includes our efforts to join with other California hospitals to ask the Governor for $1 billion in financial assistance out of the State’s current fiscal budget to help offset some of these losses. We also hope the State will commit an additional $3.1 billion to secure an equal amount from the U.S. Centers for Medicare and Medicaid Services.

Today, on a statewide media call with the California Hospital Association, I shared the impact COVID-19 has had on us financially. I shared these details to compel the Governor’s support, but one media outlet quoted me saying there would be mass layoffs locally, when I was speaking generally about the state. They have since corrected the story.

Here’s what I shared: we have gone from breaking even in the first 10 months of this fiscal year to staring at a $21.2 million operating loss at the end of April. Of our 5,000 employees, we have over 400 employees on a leave of absence for medical reasons, pregnancy leave, or for school closures. Because of a need to close some services and reduce volumes, 1,100 employees are docking hours or experiencing some level of reduced hours. In addition, we have about 140 employees who are completely furloughed (temporary layoffs).

We know COVID-19 has been financially devastating to our Kaweah Delta family. Fortunately, we have good-hearted leaders and staff that have been able to set up an emergency employee relief fund through our Foundation, which is helping supplement the loss of employee compensation. Our Executive Team members have also taken sizeable pay cuts and directed those funds to help their employees. While we are starting to bring more services online and our hospital is getting busier, the reality is that we expect May and June to be rough financially. We have talked about reforecasting our budget and we have discussed layoffs, but fortunately, we are not there yet and we hope that we will never get there.

Our hope is that the Governor will agree that healthcare is a critical infrastructure to support, along with a key foundation to a healthy society. We do not know what the future holds for us, but we know that we will not be the hospital we have been in the past. There are many unknowns at this point. I want to reassure you that we are truly in this together and we are doing everything we can for our KD family. I know this is a hard time for every one of us and despite that, I marvel each day at all that our staff are doing to provide our community with excellence and compassion, as well as everything that our community is doing to support us. Thank you.