The impact of the pandemic including disruption of services, high cost of temporary labor, increased operational and supply expenses, and falling insurance reimbursements have continued to negatively impact the financial performance of hospitals around the country and Bay Area Hospital. “Like many health care providers in Oregon, we are experiencing tremendous financial strain caused by several factors,” said Brian Moore, President, and CEO. “As a result, we have taken steps to improve efficiency and effectiveness, and reduce costs. The desire to continue our mission to improve the health of the community and our commitment to our employees have guided every improvement step.”

Over the past six months, a carefully developed, data-driven turnaround plan was implemented to change the hospital’s financial performance trajectory. The Hospital has improved patient access to care, improved patient satisfaction, and improved financial performance through improved revenue and reduced expenses. Additional changes are necessary in order to remain steadfast to the course and a financial recovery.

Bay Area Hospital has made the difficult decision to exit the Home Health market. Services will transition to other area healthcare providers by August 17. For all patients that have utilized these services, a letter will be sent with information on the transition to alternate providers. This service change, along with other operational staffing adjustments will affect 33 staff of the total 1,084 hospital employees.

Bay Area Hospital is committed to our mission to improve the health of our community. This commitment has been on display over the past year as leaders and employees have implemented changes that have reduced our operating losses by nearly $40 million annually. “We have successfully implemented a large portion of our turnaround plan and have set the course to ensure we will be here into the future. During this turnaround, we have made important investments in our employees, and we feel confident that we will work through the remaining improvements necessary to return to sustainable financial performance.” said Moore.

A significant contributor to these financial losses has been Medicare reimbursement rates that do not keep pace with inflation for home health services. Unfortunately, in the wake of the COVID-19 pandemic and the Fiscal Year 2022 $60 million loss, Bay Area Hospital can no longer afford to subsidize service lines that are available through other community providers. 

These changes will reduce the organization’s annual expenses and align the cost of operations with the budget. Bay Area Hospital remains open and committed to serving this community’s healthcare needs and honoring the people that join the organization in that mission. “We remain focused and recruiting for core functions not offered elsewhere in the community. We recognize that these past two years have been very challenging for many people but know that there continues to be a bright future ahead as we reposition Bay Area Hospital for continued success.” said Moore.