Preparing and responding to the COVID-19 pandemic has been an “unmitigated disaster financially” for Advocate Aurora Health, chief executive officer Jim Skogsbergh said.
Revenue for the Milwaukee- and Downers Grove, Illinois-based health system is down about 50% since it suspended elective procedures in March. Skogsbergh described the financial toll that COVID-19 has had on the system during a Greater Milwaukee Committee meeting Monday.
“…Revenes are at 50% and (our) expenses are actually higher – and they’re higher because we’re paying more for PPE, they’re higher because we’ve kept all our own team members whole … all of our expenses have gone up,” Skogsbergh said.
The health system posted strong financial results in January, February and the first two weeks of March, but the last two weeks of the month “wiped out” the first two and a half months of the year, he said.
In April alone, revenues at its Wisconsin facilities were down “$300-some million,” he said.
“It’s quite a financial challenge,” he said.
Skogsbergh is taking a 50% salary reduction beginning this month for at least the next quarter, while other senior executives, including hospital presidents and system vice presidents, are taking a cut of up to 20%. Those dollars are being directed to Advocate Aurora’s team member crisis fund, which provides financial assistance to employees experiencing a one-time emergency – including the inability to report to work – that makes it difficult to provide basic needs for themselves and their family during the COVID-19 pandemic, the system said.
Last week, the system announced it is resuming elective procedures, ambulatory care and imaging services in Wisconsin.
As it ramps up its services, the system plans to bring employees back and phase out furlough pay in June.
The system’s current priority is continuing to secure personal protective equipment for its employees as it resumes elective procedures.
“We are really scouring the globe for PPE and we’re in, I’d say, pretty good shape,” Skogsbergh said.
Skogsbergh noted there are nearly 800 employees who are currently out for quarantine.
As of Monday morning, Advocate Aurora had 96 inpatient COVID-19 cases in Wisconsin and 588 in Illinois, which is consistent with what the system has seen over the past few weeks, Skogsbergh said.
“We would like to say our numbers are flattening,” he said. “We are not yet on the downhill side of this but our numbers are flattening, which is good.”
Six of its facilities in Wisconsin have not had any COVID-19 inpatients, he said.
Skogsbergh noted that, while it has been financially damaging for the system, COVID-19 has strengthened the organization’s culture.
“Advocate Aurora Health has come together like never before” he said.
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