The University of Vermont Health Network announced Monday that it lost $21.3 million between October 2020 and January 2021. President John Brumsted attributed the losses to lingering fears of seeking care during a pandemic.Â
The deficit in the first four months of the fiscal year comes after the state’s largest health system reported a $16 million loss in 2020.
“The numbers were terrible,” Kevin Mullin, the state’s top health care regulator, said of the latest reports. He urged the state’s largest health system to “put [its] house in order.”
Brumsted downplayed the effect of two major setbacks at the Burlington hospital on the bottom line: an October ransomware attack and the November closure of its Fanny Allen campus. The losses were in line with national trends, which show that people have been slow to seek care, he said. He pointed to a study showing that emergency room visits had declined by 25% nationally.Â
Patient volumes at hospitals across the network hovered between 5% and 15% lower over that period than in 2019, Brumsted said. The figures varied by location, he noted.
“There’s nothing unique about the UVM Health Network with regard to national phenomena,” Brumsted said.Â
While the $39 million in state and federal aid has helped, it hasn’t plugged the hole entirely, the network chief said.
UVM Medical Center, the largest hospital in the network, has also faced a series of setbacks this winter. A cyberattack in late October felled the network’s electronic health records system for nearly two months. In December, hospital president Stephen Leffler said the attack had cost the hospital $1.5 million a day, or more than $60 million total.
In November, staff members at Fanny Allen reported another wave of the mysterious symptoms of fatigue and nausea that had plagued workers at the Colchester building off and on since fall 2019. For the third time, the hospital moved patients and staff to the main campus in Burlington.
In an interview, Brumsted said the network was still assessing losses and couldn’t say how much either incident had cost the organization, or how much it had affected the bottom line.
“The majority of the current financial situation is related to the Covid pandemic: increased expenses, and a decrease in people coming to access health care,” he said.
Hospitals have been hit hard by the pandemic, especially during closures last spring. In some cases, patient visits have ticked up. But data remains spotty, said Jeff Tieman, CEO of the Vermont Association of Hospitals and Health Systems.
“We know recovery varies by organization and some continue to experience lower patient volumes even now,” Tieman said.
The question now is how the UVM Health Network will cut costs to save money, according to Mullin, who chairs the Green Mountain Care Board.
The health care regulator said hospital administrators weren’t to blame for the budget shortfalls, and noted that UVM Medical Center also received less stimulus funding than other Vermont facilities because it does not qualify under the federal designation as a rural hospital.
Regardless of the cause, “It’s definitely a low point for them,” Mullin said. “If the largest hospital is not meeting its financial targets, you have a problem.”
Brumsted couldn’t provide specifics on how, exactly, the organization planned to tighten its belt.
Hospital administrators were shuffling staff, and considering cutting jobs and programs, he said. Brumsted couldn’t say which positions or services he’d cut, though he vowed to ensure that patients would still have access to the care they need.
“We need to match our expenses with the amount of care that people need delivered and we’re in the process of doing that,” he said.
Brumsted also said he didn’t know whether the losses could affect the organization’s bond rating.
If the hospital falters, it will inevitably be propped up by patients, said Mike Fisher, the state’s chief health care advocate.
“People have this magical thinking that there’s more money from on high,” he said. Aside from federal aid, it will be paid for by insurance rates and higher charges. “It’s from Vermonters’ pockets,” Fisher said.
The public announcement of the losses could help boost the hospital’s cause as officials jockey for a portion of the forthcoming federal stimulus package. But the hospital made the announcement for the sake of “transparency,” said spokesperson Neal Goswami.
Even so, that funding “is expected to stem some of our losses,” Brumsted said in a release. “The strong financial support we’ve received from federal and state leaders is helping us weather this storm, and we are grateful for this support.”