Congress provided $100 billion in emergency funding to hospitals to respond to the coronavirus crisis in the CARES Act passed back in March. That was supposed to provide about $108,000 per hospital bed across the country, to help hospitals meet the resource gap they were experiencing and to ramp up infrastructure to meet the coming demand. The legislation gave wide discretion to the Secretary of Health and Human Services for the distribution of the funds, without imposing many constraints. That was a bit of a mistake, as an investigation from The New York Times demonstrates.
They’ve analyzed tax and securing filings from 60 large national hospital chains that received collectively more than $15 billion of that funding. They found that a lot of that money went into the pockets of CEOs while thousands of employees—health care and support workers—were furloughed, laid off, or had their pay cut. For example, HCA Healthcare, worth $36 billion and a chief executive was paid $26 million in 2019. HCA got $1 billion in emergency funding, but “employees at HCA repeatedly complained that the company was not providing adequate protective gear to nurses, medical technicians and cleaning staff,” and in May, “HCA executives warned that they would lay off thousands of nurses if they didn’t agree to wage freezes and other concessions.”
Of the 60 hospital chains the Times looked into, at least three dozen have laid off, furloughed, or cut the pay of their staff to “try to save money during the pandemic,” despite the fact that among them they’ve got tens of billions in cash reserves. The five highest-paid executives among these chains were paid a collective $874 million in the last year financial data was available. In interviews with more than a dozen workers at these hospitals, the Times found the it’s the front-line staff that’s been hurt the hardest—custodial and cafeteria workers, and nursing assistants. They also said that “pay cuts and furloughs made it even harder for members of the medical staff to do their jobs, forcing them to treat more patients in less time.”
The Mayo Clinic got $170 million in CARES funds, despite having something like eight months worth of funding in reserve. It has furloughed or cut hours for 23,000 employees, though one of the spokespeople who has not been furloughed tells the Times that Mayo executives have cut their own pay. Seven other chains—Trinity Health, Beaumont Health and the Henry Ford Health System in Michigan; SSM Health and Mercy in St. Louis; Fairview Health Services in Minneapolis; and Prisma Health in South Carolina—received a collection $1.5 billion and among them have let 30,000 employees go, either permanently or temporarily. Tenet Healthcare got $345 million in bailout money, and has furloughed 11,000. Stanford University’s health system got $100 million (it has 42.4 billion in reserve) and “is temporarily cutting the hours of nursing staff, nursing assistants, janitorial workers and others at its two hospitals.” The spokesman for the system says that those reductions are intended “to keep everyone employed and our staff at full wages with benefits intact.”
HCA, however, is the biggest villain here. The $1 billion—One. Billion.—it got in emergency grants is the largest. But in the past few months, the medical staff at 19 of its hospitals have filed Occupational Safety and Health Administration complaints over lack of personal protective equipment, including respirator masks and gowns. At least two HCA employees have died from coronavirus because they didn’t have adequate PPE. Celia Yap-Banago, a nurse in Kansas City died in April. She treated a patient without wearing PPE. At an HCA hospital in Riverside, California, Rosa Luna and her fellow janitorial staff clean rooms of coronavirus patients, and haven’t been provided proper masks. Rosa Luna died last month, at the same time that HCA executive were warning the unions representing hospital workers that “unless the unionized workers amended their contracts to incorporate wage freezes and the elimination of company contributions to workers’ retirement plans, among other concessions.”
Yes, all of these systems have lost money because pretty much everything but coronavirus care has stopped in the last few months; elective surgeries and procedures have been cancelled, non-coronavirus emergencies like car wrecks have plummeted with stay-at-home orders. But these huge hospital chains, which have received disproportionate amounts of CARES bailout funds, have billions in reserve collectively. They have CEOs bringing home millions in salary and bonuses. They can afford to keep their staff.
They need to be required to use some of the bailout money to retain and pay staff at current, if not enhanced, hazard rates. The bailout funds have already been highlighted as problematic because they were not meted out by coronavirus case numbers, but by a formula that allowed HHS to send the money out fast whether it went to hospitals that needed it most or not. A Kaiser Family Foundation analysis last month showed that the wealthiest hospitals, with the highest care of private insurance revenue, were getting the bulk of the emergency grants: “hospitals in the top 10% based on share of private insurance revenue received $44,321 per hospital bed, more than double the $20,710 per hospital bed for those in the bottom 10% of private insurance revenue.”
About the Author: Joan McCarter is a Contributing Editor for the Daily Kos.