Rural hospitals face financial challenges from coronavirus

JRMC CEO Mike Delfs.jpg
Mike Delfs, CEO of Jamestown Regional Medical Center. John M. Steiner / The Sun File photo from 040319.

The loss of revenue from reductions in other medical services due to the coronavirus pandemic precautions could lead to an "extinction event for rural hospitals," according to Mike Delfs, CEO of Jamestown Regional Medical Center.

The concern comes from the estimated $4.2 million per month in lost revenue from all the other medical services JRMC provides that have been curtailed because of the coronavirus pandemic.

"Small hospitals are designed to survive with multiple revenue streams," Delfs said. "We're seeing fewer visits in our clinics, fewer people for therapy, there were even less elective surgeries before we stopped doing elective surgeries."

That amounts to about a 63% reduction in the volume of medical procedures at the hospital during the last two weeks of March, according to Bev Fiferlick, chief financial officer of the hospital.


"The cash surplus we had going into this is dwindling quick," she said. "We have the same expenses but much less revenue."

The Coronavirus Aid, Relief, and Economic Security Act” or the “CARES Act," was signed into law last week. Along with individual stimulus checks and other programs designed to support the economy, it includes additional funding for hospitals.

"It was written for the larger hospitals," Delfs said. "... they didn't spend a lot of time thinking of the rural hospitals."

The bill does provide about $3.5 million in assistance to JRMC.

"Less than one month of lost revenue in the best-case scenario," Delfs said, referring to the expenses the $3.5 million grant would cover. "That is on an event that will likely last three to five months."

Another bill has been introduced in the U.S. Senate aimed specifically at aiding rural hospitals, he said.

The Immediate Relief for Rural Facilities and Providers Act was introduced by Colorado Sens. Cory Gardner, a Republican, and Democrat Michael Bennet. Sen. John Hoeven, R-N.D. has also signed on as a cosponsor of the bill.

There has been no action on the bill and the U.S. Senate is currently in recess until the end of April.


Delfs said one of the few things JRMC can do now is actively lobby for the bill, which they are doing. The bill provides grants and low-interest loans to hospitals that qualify.

Fiferlick said the concern is not just about JRMC which has some cash reserves at present.

Unfortunately, many rural hospitals are in worse situations, she said. In some cases, rural hospitals may have to sell to larger health care systems that may not have the commitment to care in the rural setting that the independent and local hospitals do.

"Some hospitals have low amounts of cash on hand," she said. "It is not just about Jamestown."

The circumstances can be dire if the hospital runs out of cash.

"They close or take on debt," Delfs said.

Bev Fiferlick

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