Hospital far from closing – Officials say finances bad, not ruinous |

Back to: Local News

Hospital far from closing – Officials say finances bad, not ruinous

Sierra Nevada Memorial Hospital is in no danger of closing, officials said Friday, but it is one of many in California struggling with higher costs and declining revenues.

“The hospital is tightening up wherever it can to keep the financial situation from getting worse,” said hospital spokesman Gary Cooke.

This week, that streamlining led the institution to lay off the equivalent of six full-time positions, cutting the hours or eliminating the jobs of nine management or nonunion employees.

It was the second round of layoffs in less than a month for the hospital, which has been experiencing a rough economic trend for the past year – as have many hospitals around the state. According to the California Healthcare Association, which represents the state’s hospitals, 51 percent of the institutions are currently in the red.

Sierra Nevada Memorial layoffs and other cost-cutting measures are the result of a $1.5 million deficit which could not be ignored, Cooke said Friday.

“We’re still providing the key services we always have, and there could be more adjustments coming,” Cooke said. “The mission is to meet community needs, but it has to be financially viable.”

In a September letter to Gov. Arnold Schwarzenegger, the president of the state healthcare association said things are bad and getting worse.

Association President Duane Dauner said California’s hospitals are being hit by “a convergence of adverse forces.” Those include patients with no insurance, declining Medicaid and MediCal payouts, and a state mandate to retrofit hospitals for earthquakes.

Eight California hospitals were forced to close last year, Dauner said, and more closings are expected.

At Sierra Nevada Memorial, “the hospital is not in danger of closing, or even close to that,” Cooke said. Fewer patients, declining insurance payouts and higher costs are the reasons for the hospital’s woes, said Cooke and hospital CEO Tom Collier.

“It’s not a friendly (fiscal) environment these days for hospitals in the country or the state,” Cooke said.