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July 2 Employee Huddle

July 2, 2020

Due to the Fourth of July holiday, we moved the weekly huddle up a day and went live this morning with answers to your questions. If you missed the webinar or want to listen to the information shared again, please visit the link below. Topics included Kaweah Health’s financial future, universal masking for patients, surge plans, and more.

Please Note: Time did not allow us to answer every submitted question, so we will get to unanswered questions at next week's KD Huddle. Submit a question now for next week by e-mailing

QUESTION #1: Based on the 06-30 clinical snapshot; Tulare County experienced a 30%+ increase in new positive COVID cases last week. What are we doing to prepare for this surge in patients?

We are absolutely experiencing a surge, but we have been preparing for one since the beginning. We are planning for an increase in COVID patients, and with all of our non-COVID patients, we have a very full hospital. Currently there are 54 COVID patients at Kaweah Health, and over 200 non-COVID patients. We have identified areas in the hospital that are not normally inpatient care. These areas will be utilized as needed if a surge continues.

QUESTION #2: For COVID positive patients does the trash need to be in red biohazard bags?

No, COVID patient’s trash does not need to be put in the red biohazard bags. Those bags are used for blood and other bodily fluid. As long as the staff handling the trash is being cautious by wearing gloves and washing hands before and after, that is sufficient enough.

QUESTION #3: For COVID positive patients do we just take their meal tray out to the regular meal cart?

Yes, the staff handling the meal carts know how to properly handle the trays. Again, they need to wear gloves and wash their hands before and after.

QUESTION #4: Are you going to start requiring all patients in the hospital to wear masks? Currently if you go to ED and they are not possible COVID patients they are not wearing masks.

The expectation is to have all patients wearing masks, if they can tolerate wearing one. Inpatients on the floor may not wear a mask in their rooms, but should wear one if they leave their room.

QUESTION #5: The CNAs are starting to get a bonus for picking up extra shifts. Will bonuses be offered to the LVN’s?

This is routinely being evaluated. It is as needed, if there is a shortage in their area and if we need our current staff to take on extra shifts, then they most likely will be offered bonuses too.

QUESTION #6: How is the nursing shortage affecting our current group of clinical staff?

Significantly. There is strain on clinical staff with high censuses, constant PPE use during care, and long hours. They are constantly on edge and cautious, which can be very tiresome. There is plans set in place to get more nursing staff.

QUESTION #7: A friend is trying to get it for testing and was told the first available testing appointment is July 7th. What are the resources we can tell our friends and family? Does she really have to wait until July 7th?

It depends on the site. There are 20 sites that collect specimens, and two sites that test those specimens. The Tulare County website has a list of all the sites. Our test site on Floral street collects about 300 specimens a day and appointments are required. We are working on moving our test site to another location that is indoors.

QUESTION #8: Will there be routine testing for employees?

Currently we do not have the supplies for routine testing. We are asking that employees continue to wear masks and take precautions. If you have been exposed, we ask that you self-monitor for symptoms.

QUESTION #9: Can Gary address the differences in financial deficits being reported?

The fiscal year runs from July 1- June 30. In the first 11 months of the 2020 fiscal year, we had an actual operating loss, where the expenses exceeded revenue, of $28.8 million. The first 8 months we broke even, then we experienced the $28.8 million operating deficit during the months of March, April, and May. At the beginning of the fiscal year we budgeted for a $17.5 million expected positive revenue, but instead we had a $28.8 million deficit. When we add those together, we are $47 million under budget.

QUESTION #10: With the extreme downturn of the financial condition of hospitals across the State, and even the State government, has there been any conversation about postponing the seismic safety requirements that have been scheduled to be completed by 2030 for the past nearly 35 years?

It is still currently on the books and is unchanged. The safety requirement is for hospitals to renovate or replace older facilities, by 2030. It will cost $140 billion to make all California hospitals compliant and many hospitals are not able to afford it. There is a bill that legislation is trying to pass that will allow hospitals to continue to operate and be compliant.

QUESTION #11: Do we expect the credit watchdogs (Moody’s) to adjust our credit rating? If so, what is the financial impact on Kaweah Health specifically, and to the hospitals across the nation?

Kaweah Health’s credit is evaluated/rated by Moody’s. Currently we are at a A3, which translates to an A- level with our outlook being negative. We were recently downgraded from stable to negative. We fully expect that all rating agencies will downgrade all hospitals to negative. KD will be downgraded to a BAA (B+). It will not cost KD any money if our credit is downgraded, it will only affect us in the trading markets.

QUESTION #12: Regarding the changes in Benefits. Can we please have more detail on this? Are co-pays changing? Monthly rates? Do we know yet how much the out of pocket will be increasing as of January 1st. Are there going to be changes to what is and is not covered?

The hospitals revenue is $800 million, with benefits being $80 million. KD has 8,000 members, staff and their families, who are currently enrolled in our benefits, costing $15 million. The goal is to reduce Health, Vision, and Dental by $3 million. The HR department is actively searching for ways to reduce expenses. Some examples that can help reduce expenses are to have more employees use the Chronic Disease Center for their prescription drugs, increase the share of cost, which is tax free, and change the amount of hours to be eligible for benefits. Any benefit changes will be effective January 1. There is more information regarding benefits to come. HR is going to be more transparent and share information with employees as changes come along.

QUESTION #13: Regarding the lack of matching contribution to the 401(k) plan…. Is there a plan to make up for this money in the future when the district is profitable again? What options are you exploring?

In 2003 the match for the 401(k) plan was introduced. Back in January we were fully intended to match, however we simply do not have the funding for it right now. As difficult as it is, we had to stop. Those employees who are still enrolled can still accumulate funds for retirement. We are still encouraging staff to continue contributing if you can, however you can decide to stop until next year if choose. Right now the federal and state government is allowing people to pull funds from their retirement without penalty. If you would like need more information, please reach out to the benefits team.

QUESTION #14: Regarding the ‘On-Call” and/or “standby reductions - Can you provide details on which departments and/or positions this will impact?

My director was unaware of this change and is currently unable to tell me if I am impacted by this change. More information will be available next week.

QUESTION #15: What are we doing about our nursing shortage?

So far we have on-boarded 60 RN’s. 27 are starting on Monday, 32 more are waiting for their licensure, and 21 current employees are waiting for their licensure, we have hired 38 new travelers, and we have 100 pending interviews. We are being proactive by hiring many new RN’s, knowing that we could see big turnover rates.

QUESTION #16: Are the remote employees still being brought in next week? Do more employees need to be remote due to our high numbers?

We are leaving it up to the VP’s and Directors to establish when employees should return to work, and only if it is safe and they are able to accommodate. If you have any questions, please direct them to your VP or Director.

QUESTION #17: Besides layoffs, what other cuts will impact employees going forward?

Per The News You Can Use by Gary:

Here are the specific budget actions that must take place if we are to remain on a long-term course of success and financial stability:

  • Work to reduce financial subsidies provided to contracted physician groups through improved professional fee collections, changes in staffing models and renegotiation of contracts;
  • Reduce travel and education by $100,000 for the year;
  • Work to consolidate certain ancillary and support services of the Kaweah Health Medical Foundation with existing Kaweah Health operations;
  • Work to improve documentation of Humana Medicare Advantage members’ health factors and conditions to increase premium revenue received from Humana;
  • Continue to work effectively to reduce the average length of stay patients spend in the acute care medical center;
  • Work to reduce supplies utilization and improve pricing through consolidation of vendors and more aggressive price negotiations;
  • Except for California State Minimum wages increases effective January 1, 2021, employee wage rates will be frozen for the fiscal year ended June 30, 2021 (no Pay-for-Performance increases or merit lump-sum payments).However, there will be no reductions in wage rates;
  • There will be no matching contribution by Kaweah Health to the Employee Salary Deferral Retirement Plan (401(k) plan) for the Plan year ending December 31, 2020 and Kaweah Health will reduce its matching contribution to 50% of what it would normally match for the Plan year ending December 31, 2021.The calendar year 2019 match will be made within a month or so, totaling approximately $9 million in match monies to participants;
  • Effective August 1st, rates for being “On Call” and/or on “Standby” will be reduced by approximately $277,000 for the year for certain non-clinical positions;
  • Changes will be made to eligibility for participation in the Kaweah Health Employee Health Plan (higher number of hours worked per pay period to qualify) along with increased employee share of cost in the plan (to be effective January 1, 2021); benefits will still be highly competitive with the market;
  • Effective January 1, 2021, eliminate the optional cash payout of accumulated PTO time; and,
  • Work to reduce use of overtime.

The board passed the budget on Monday. There is going to be a 0% operating budget with the plan to break even. However, we have built in contingencies in the budget. If there is a COVID surge and we have to shut down elective surgery surgeries, the Board will call onto those contingencies. The Board also decided to meet monthly to go over the budget and other necessary items.