Home Financial consultant Watsonville Hospital Officials Discuss Future Plans – Santa Cruz Sentinel

Watsonville Hospital Officials Discuss Future Plans – Santa Cruz Sentinel


WATSONVILLE – The sprint is over, but the marathon has only just begun.

That’s the mindset of Pajaro Valley Health Care District Board Member Jasmine Nájera, who has been the official owner of Watsonville Community Hospital for more than three weeks now.

The acquisition, announced Aug. 31, capped an eight-month dash that began shortly after the hospital’s former owners filed for bankruptcy in the winter of 2021. The effort included expedited legislation from the state and “the largest fundraising campaign in the history of Santa Cruz County,” according to district officials, who raised $65.5 million from more than 450 donors to complete the purchase.

But when the district took possession of the hospital on September 1, it set its sights on a new, equally critical challenge: keeping the hospital open and financially viable.

Last month, a district financial consultant said the hospital lost $22 million in the year before bankruptcy and is expected to lose $23 million this year.

Pajaro Valley Health Care District Board Member Jasmine Nájera stands outside Watsonville Community Hospital on September 1, 2022, the day the district officially took possession of the hospital. (PK Hattis – Sentinel of Santa Cruz)

“It’s going to be a challenge,” Nájera told the Sentinel last week. “None of us think ‘oh great, the hard work is done.'”

So where will the hard work take place, now and in the future of the hospital? The Sentinel spoke to Nájera and other hospital officials to find out.

Early actions

Since the hospital is now considered a new business, one of the first areas of focus for hospital management is the renegotiation of all supplier contracts.

Watsonville Hospital CEO Steven Salyer told the Sentinel that his staff will reform more than 650 contracts in the first 60 to 90 days of ownership, which he sees as a significant opportunity to strengthen the hospital’s finances. ‘hospital.

“This organization, for a very long time, was paid at the 25th percentile or less compared to other organizations around us or within the state,” Salyer said, sharing that his team’s goal is to receive median payout totals for each location. suppliers.

If the effort is successful, Salyer said it could bring in an additional $11 million a year in revenue, adding that the renegotiation process “looks very positive.”

However, the hospital also serves many elderly and low-income county residents who rely on Medi-Care and Medi-Cal insurance, which has fixed reimbursement rates often significantly lower than commercial payer levels. According to a statement from the health district, approximately 50% of the hospital’s patients rely on Medi-Cal and 30% on Medi-Care.

“That’s not going to change, it’s the community we serve,” Nájera said, acknowledging both the challenge and highlighting the critical equity role the hospital plays in the county.

She and Salyer said they believe there are other significant revenue strategies to build on, namely expanding the hospital’s range of services. Salyer said the hospital will commission a catheterization lab for cardiac treatment in 2023 and is in discussions to bring a 21-bed psychiatric unit to the hospital.

“It would be a major victory for the county,” said Salyer. “This suite of services is needed across the state and (could) excite many healthcare partners.”

Santa Cruz County spokesman Jason Hoppin also confirmed that raising revenue for the hospital through tax avenues is not currently being considered.

“While hospital districts have the power to raise revenue to support hospital operations, there are no plans at this time to implement a tax,” Hoppin told the Sentinel. “If a solution were to be considered in the future, it will be a conversation between the PVHCD Board of Directors, Watsonville Community Hospital and constituents of the Pajaro Valley.”

Strategic plans

As the district health care board worked with a consultant to develop a business plan that was implemented from day one, Salyer said he expressed a desire to form a new strategic planning committee to reconfigure the plan now that the hospital board and staff can formally collaborate.

Salyer said he was engaged in many initiatives already in place, but “as a new company, we’re going to take that process back to create a unified plan that the board agrees with, management agrees with. okay, the vendors that work here, and I’ve even asked for front-line staff to be involved in the strategic planning process.

In early August, the council announced it would move many part-time nursing positions to full-time status in a bid to reduce costs and the number of traveling nurses, who can have up to three times the full-time employee rate. , according to Salyer.

The decision sparked a flurry of negative comments from the nursing unit, many of whom had worked at the hospital for decades, saying the move would increase burnout among staff who need time off to heal. recover from the physical and emotional demands of the job.

“One of the most important things for us is to really take care of our staff and make sure they feel supported,” Nájera said of the strategic planning process, which is expected to begin in October. “We are very aware that there are quite a few nurses who are really upset with some of the decisions that have had to be made. But we want to keep that dialogue open and create forums and town halls where we can get that input and have good two-way dialogues.

Besides rebuilding staff morale, other strategic plan priorities mentioned by Salyer include investing in local partnerships, such as school districts and philanthropic organizations, as well as a focus on quality of care.

“We will be one of the best hospitals within 100 miles when it comes to quality,” Salyer said. “With everything we’ve been through, all the turmoil… our goal is to build stability, boost staff morale and really make doctors feel like this is the best place for them to bring their patients to work. »

Nájera also expressed optimism for the future, where the hospital goes beyond financial stability and emerges as one of the premier healthcare facilities in the region.

“We deserve it here,” she said. “This is a hospital that serves so many valuable and essential workers and really, we want to make people want to come here.”