WHEELING, W.Va. — Wheeling Hospital is reducing its workforce as a result of the financial impact of the COVID-19 pandemic and other factors.
The hospital, which WVU Medicine took over managing in June 2019, announced on Tuesday that it will begin the reductions with a Voluntary Reduction Plan.
Hospital CEO Doug Harrison told MetroNews the COVID-19 pandemic has had a $35 million impact on the hospital. To date, the hospital has received just over $22 million in CARES Act funding but has lost over $18 million in the current fiscal year. Harrison added the hospital lost $11 million in 2019.
“The hospital is continuing to be severely financially impacted by the COVID-19 pandemic and we just didn’t see any relief in sight. This is going to be around for a while,” he told MetroNews.
“Prior to COVID we were losing money, but not to the extent once COVID hit.”
He said there was no other choice for the hospital, other than to file bankruptcy, but to cut the bulk of overhead expense which is personnel. Harrison told MetroNews that between attrition numbers, employees already lost as of March and through the voluntary reduction, the Ohio County hospital is looking to cut $10 million out of the run rates.
Harrison hopes to avoid cuts to the clinical programs.
“That’s what I am trying to avoid and look at the non-clinic piece of what we do. Obviously, we want to grow clinical-based services and strengthen the clinical-based programs,” he said.
Hospital officials said they have taken several steps to help mitigate the losses, such as voluntary reductions in pay from administrative staff and physicians; a short-term elimination of retirement matching funds; low-census staffing protocols and reduction of capital spending.
According to a release from the hospital, the hospital is also preparing for a settlement agreement with the Department of Justice as it defends itself against a qui tam action case. Before Harrison’s arrival as CEO, the Department of Justice accused Wheeling Hospital of violating Stark Law, and the Anti-Kickback Statute.
Harrison said there is no timetable on when the lawsuit would be settled.
“Typically if you look around, those settlement agreements with other hospitals around the country are never small sums of money. We are anticipating a significant portion of money coming out of the hospital once that is settled,” Harrison said.
Another factor in the loss of money according to Harrison is a “broken Medicaid system” and being overstaffed in certain areas compared to national benchmarks.
“With the closing of other hospitals in the region, we have seen an increase in Medicaid patients and no-pay patients and the Medicaid reimbursement doesn’t cover a fraction of the cost of care. The Medicaid system, not only in this state but other states is broken,” Harrison said.
Harrison said the hospital will not survive without making these types of decisions and continuing to find a long-term strategic partner for its ultimate survival.
“For 170 years, Wheeling Hospital has proudly served this region through discipline and prudent management of its resources,” he said in a release.
“Because of COVID-19 and the impending DOJ settlement, we have been forced to make the painful decision to eliminate staffing resources. We are hopeful that by acting now, we are assuring that the hospital continues to maintain its viability and clinical excellence to meet the ongoing needs of the community in the future.”
The hospital is offering a severance plan for anyone interested in participating in a Voluntary Reduction Plan. Employees will have until Aug. 4 to decide if they want to participate.
If the Voluntary Reduction Plan fails to achieve the appropriate staff reductions, an Involuntary Reduction Plan may be implemented, according to hospital officials.