Decades of cuts leaving Eastern North Carolina hospitals vulnerable to financial losses due to coronavirus

North Carolina currently has 49 rural and independent hospitals around the state, but the financial toll caused by the COVID-19 outbreak may strain the remaining hospitals already struggling from decades of funding cuts. 

As the pandemic continues to sweep across the state, rural hospitals are set to lose more than $145 million per month.

The loss of money from canceling elective procedures, low-level care and the high cost to prepare for the pandemic, may lead to an upward swing in rural hospital closures.

Vidant Health, eastern North Carolina’s largest health care system that serves more than 1.4 million people in 29 eastern North Carolina counties, announced a series of cost-cutting measures due to economic pressures generated by COVID-19.

The Pitt County based hospital lost over $100 million over the past six weeks, resulting in more than 120 layoffs, staff furloughs and salary reductions to offset the devastating financial loss. 
Rural hospital financial insecurity and closures are not unfamiliar for eastern North Carolina communities as more than six rural hospitals have closed in North Carolina since 2010.

From WRAL:

The pandemic is likely to worsen systemic problems that have plagued the state’s health care system for years.

Dr. Roxie Wells, president of Cape Fear Valley Health’s Hoke Hospital, said the cost of preparing for the expected surge in cases has left already struggling rural and independent hospitals “in dire straits.” She called on lawmakers to take “swift action to ensure the solvency” of those hospitals.

Dr. Sy Saeed, chairman of the psychiatry department at East Carolina University’s Brody School of Medicine, said the state’s mental health system “was already in crisis before COVID-19,” adding that demand for mental health care is likely to increase due to the virus.

According to Saeed, 31 counties in North Carolina have no psychiatrist. Thirteen counties have no behavioral health providers at all, and 90 out of the state’s 100 counties would qualify as shortage areas for mental health providers.

“It’s imperative for North Carolina to do this now,” Sasser said.

Cornell Wright, director of the Office of Minority Health at the state Department of Health and Human Services, said the virus is disproportionately affecting black North Carolinians because of a range of health inequalities ranging from unemployment and income to access to health care.

“The health disparities highlighted by COVID-19 have always been here,” Wright told lawmakers, “and we have to make sure we’re continuing to put work into illuminating these.”

Wright stressed that coronavirus data in North Carolina is limited at this point. But he said, according to the data available, 38 percent of positive cases of COVID-19 in the state so far are blacks, far higher than their 21 percent representation in the population.

“This is why we need to expand Medicaid at this time,” Wright told the committee.

States like North Carolina that have chosen not to expand Medicaid have experienced the most rural hospital closures over the last 10 years according to a report from the Chartis Center for Rural Health.

State lawmakers’ failure to adopt Medicaid expansion has prevented expanded health care access for low-income families for years, essentially depriving millions of rural area residents and its hospitals as COVID-19 continues to spread.

Despite financial losses and inadequate resources for hospitals and communities in rural North Carolina, state lawmakers’ health plan in the latest legislative session only features a slight budget increase.

The lawmaker’s temporary fix does not address long-term financial solutions or vital resources for the already underfunded, rural hospitals that are losing $145 million each month during the pandemic.

Implementing long-term funding and support to ensure the survival of our state’s rural hospitals and the people they serve during and after the pandemic should be addressed by lawmakers. Now is the time to address the decades of financial shortfalls plaguing North Carolina’s fragile health care system, not run away from it.