After Irene: Hospitals Calculating Costs Following Hurricane
Modern Healthcare
September 5-11, 2011
By Melanie Evans

The full weight of costs that Hurricane Irene dropped on East Coast hospitals won't be known for weeks or months, even though most escaped without significant damage.

New York hospitals that emptied out before the storm quickly reopened, but many beds remained vacant. In Maryland, a hospital laboratory flooded through a damaged roof. Hospital workers in Vermont moved into nearby hotels after storm damage lengthened commutes from 30 minutes to three hours.

Hospital finance chiefs face a complex task in tallying the costs of preparations, evacuations, repairs and lost revenue. The storm, which claimed dozens of lives and devastated some communities, made landfall Aug. 27 in North Carolina as a hurricane and reached New York City the next day as a tropical storm before continuing north.

In communities that suffered the most damage, hospitals may see a sustained drop in demand for medical care as residents temporarily move elsewhere or struggle to rebuild, said George Whetsell, a managing director with consultants Huron Healthcare, who worked with Baptist Hospital in Pensacola, Fla., after Hurricane Ivan in 2004. “Seeking healthcare will be further down the list of priorities,” he said.

St. Clare's Hospital campus in Sussex, N.J., remained closed at the end of last week, though its emergency room was prepared to reopen, said Chief Financial Officer Mark Hebers. The campus evacuated 14 patients to its Denville, N.J., campus Aug. 29 after a generator failed. Contaminated water forced the hospital to remain shuttered.

For the hospital, the consequences of closing are “no different than any other storefront,” Hebers said. “I still have to pay the mortgage,” he said. “I still have to pay the light bill. I still have to pay people's salaries.”

St. Clare's Hospital will bear the expenses of paying overtime and repairing damages and will see revenue drop from its closed emergency room, Hebers said, but he has yet to start adding up those costs. “It's way too early,” he said. Executives continue to work on reopening the Sussex campus and addressing patients' needs.

The storm did less damage than expected to New York City, but executives at North Shore-Long Island Jewish Health System face lost revenue after closing two hospitals ahead of the storm. How much is not yet clear, CFO Robert Shapiro said.

The Great Neck, N.J.-based system evacuated 673-bed Staten Island University Hospital and 296-bed Southside Hospital in Bay Shore, N.Y. Roughly 1,000 patients were transferred throughout the 11-hospital health system.

The measures disrupted hospital admissions that occur when patients arrive in the emergency room or are transferred from other facilities, and each hospital was left with a depleted census beyond the weekend evacuation. Most patients emptied from those hospitals did not return, either because doctors sent patients home or patients were held at new facilities to avoid the risk of medical complications from another transfer. Shapiro said he expects elective procedures to be rescheduled.

Robert Power, CFO for the system's Southside Hospital, said officials expect to analyze hospital data from August 2010 and the prior six months of 2011 to calculate the lost revenue during the storm.

Power said Southside, on an average day, has 250 to 260 patients. Days after reopening, the hospital had roughly 200 patients.

Southside also hired sandbagging crews and landscapers to trim back trees to protect against flooding and high winds. The hospital rented a generator on a flat-bed truck as backup should waters damage Southside's existing generators. Mechanics for the generators and elevators remained at the hospital, as did operating room staff, surgeons and specialists because Southside's emergency room remained open, Power said.

Shapiro said he is unaware of a source that might cover the costs of transferring patients to hospitals outside of coastal New York's most flood-prone areas. The system also faces overtime expenses for employees who slept at work to ensure enough staff throughout the storm.

In Cambridge, Md., a damaged roof forced the evacuation of 44-bed Dorchester General Hospital. The hospital's laboratory flooded with nearly a foot of water from rains. Early Aug. 28, 21 patients were transferred to 107-bed Memorial Hospital at Easton, said Patti Willis, a spokeswoman for Shore Health System, which owns the two hospitals. “You can't run a hospital without a laboratory,” she said.

The hospital was scheduled to reopen Friday after roof repairs and the laboratory's walls, ceilings and other water-damaged materials were replaced, she said. All the transferred patients have since been discharged, Willis said. Financial officials are working to asses the cost of damage and lost revenue, she said.

Rutland (Vt.) Regional Medical Center did not close during the storm, but severe flooding that damaged roads, washed out bridges and left some Vermont towns stranded also cut off most roads to the 137-bed hospital.

President and CEO Thomas Huebner said access to the hospital improved through last week but employees continued to find traveling to and from work a challenge. Rutland Regional has rented hotel rooms for 20 to 30 workers a day, Huebner said. It's not clear how long that need will persist, but Huebner said he believes housing costs will be the hospital's single largest expense from the storm.

Some workers' commutes have lengthened from minutes to hours. “That's not realistic,” Huebner said. Some employees cannot return home once they leave, he said. “Everything's harder.”