Commentary: Oregon’s Hospitals Victims of Their Own Efficiency

Oregon has a population of three million people, and 62 hospitals to serve them. All of them are suffering tight budgets during the current public health emergency. The CARES Act provided them with $425 million, but that’s among the lowest amounts per capita in the country, for reasons that aren’t immediately obvious. 

What is obvious is that if more money isn’t found somewhere very soon, bad things are going to start happening all over the state, but especially in rural areas, where medical care is already difficult to reach. 

Washington is in almost as difficult a situation, with per capita funding nearly as low. Beth Zborowski of the Washington State Hospital Association told KOIN Channel 6 TV that she suspects the peculiar disbursement is a result of the Northwestern states handling their large number of Medicare and Medicaid patients at a relatively low total cost. “It’s a bit of a penalty for efficiency”, she said, “which is unfortunate when we were the first state hit and have been operating with the increased expenses and constrained revenues for longer than state’s who have received a larger share of the dollars.” 

Between increased costs from having to treat people suffering from COVID-19 infections and testing large numbers of people, plus reduced revenues from people cancelling elective procedures, hospitals are having to spend more money while taking in less. The Federal money is not nearly enough to keep Oregon’s hospitals functioning. 

The state legislature is not proving to be much more help. Asked for a $200 million grant, the legislature debated $50 million, and also considered whether to distribute the CARES Act money as grants, or as loans at little or no interest. Tina Kotek, Speaker of the Oregon state House of Representatives, was firm in responding to questions about the hospitals’ request. “No one has audited their books, no one has looked at their books, no one has a sense of their reserves, no one has a sense of when their cash flow will return based on elective surgeries”, she told KOIN. “So we would be saying, ‘trust us’ give us a lot more money because we say we’re in distress. Well, frankly, everyone is in distress right now.” 

For now, Legislators are delaying, hoping that Federal money will be sufficient, and that hospitals’ income will improve as they perform more non-emergency procedures. 

By John M. Burt