Visalia, Calif.-based Kaweah Health is a busy hospital with a robust emergency room seeing more than 81,000 patients per year. The hospital is among Healthgrades' top 250 hospitals in the nation and had a financially strong position pre-pandemic with an A3 Moody's Investors Service rating.
Then the pandemic hit.
Since March of 2020 the 613-bed hospital and health system sustained a $127 million operating loss, including $29 million lost in the first quarter of the year, and cash reserves dropped from 130 to 84 days cash on hand, according to a letter penned by Gary Herbst, CEO of Kaweah. The open letter, published in Visalia Times Delta, implores Mr. Newsom to provide funding for district hospitals and reform Medi-Cal reimbursement to keep the system from closing beds and services.
"The COVID-19 pandemic, and its aftermath, have brought District hospitals to the brink of financial collapse," Mr. Herbst wrote. "Without your help, it will soon be virtually impossible for Medi-Cal patients to receive anything but emergency medical care in the State of California."
Mr. Herbst also said the hospital will soon default on over $200 million in revenue bond debt and doesn't have the funds to build the $730 million patient tower needed to ensure more than 200 of its beds are compliant with state regulations.