Amid financial pressures and uncertain leadership, leaders at the Cook County-run health system are now pausing plans to build a new, $241 million modern Provident Hospital, WBEZ has learned.
The county had rolled out its ambitious proposal for the South Side hospital site less than six months ago. Plans included building a smaller hospital that also would house outpatient care and specialty services, like orthopedics and sports medicine.
But the plans have now run up against a variety of unknowns. The health system, known as Cook County Health, is conducting a search for a new CEO, who might have a different strategy.
The health system also is trying to get a hold of its finances. Preliminary figures show the system finished the 2019 fiscal year with a roughly $514 million shortfall.
And four hospitals on the South Side that surround Provident recently announced plans for a $1.1 billion merger, which could draw away patients from Provident. The hospitals would combine into one new hospital and open up to six outpatient centers to be built throughout the South Side, the Chicago Sun-Times has reported.
Cook County Health spokeswoman Caryn Stancik confirmed the system’s plans to demolish and replace Provident are on hold.
“The goal is to put the project on pause until the new CEO has time to evaluate it and lead the project,” Stancik said.
The new CEO likely won’t start until June or July, county leaders have said. They’re still crafting the job description after a series of public hearings, following the former CEO’s ousting last year.
And there’s a political tug-of-war between the health system board members and their bosses downtown – the Cook County Board of Commissioners, who oversee the government’s $6.2 billion budget. Following the recent tumult at the health system, Democratic Board President Toni Preckwinkle and some commissioners want more power over Cook County Health’s board, which is pushing back.
Cook County Health is one of the largest public health systems in the nation and is the biggest medical safety net for poor and uninsured people in the county. Its financial health is critical because it makes up nearly half of the county’s overall budget. The system has two hospitals, a network of city and suburban clinics, and a Medicaid health insurance plan – called CountyCare – that covers about 318,000 low-income and disabled people.
Cook County Health’s $514 million shortfall was discovered in December after the health system closed the books on 2019, said Ammar Rizki, Cook County government’s chief financial officer. The fiscal year ended Nov. 30.
Rizki said the big operating loss was not a surprise.
“We had a sense that there was going to be a shortfall of a sizable magnitude,” Rizki said.
An audit will later confirm how Cook County Health finished the 2019 fiscal year financially. But in basic terms, the system spent more money than it made. Rizki ticked off a host of reasons why.
In 2019, the system paid off a large chunk of bills to medical providers that were due in 2018.
It also treated fewer CountyCare members within the health system than leaders expected to. Instead, those Medicaid patients went to other doctors and hospitals in the large insurance network, which means CountyCare had to reimburse those providers instead of keeping the money within the county health system.
CountyCare also enrolled fewer people than expected. It lost money that way because the state Medicaid program pays CountyCare a fixed rate for each member it has. Meanwhile, the state was also late in reimbursing the health system, adding to its shortfall.
Then there’s the worsening problem that keeps giving county leaders heartburn: the climbing tab of so-called uncompensated care for treating the uninsured and others who can’t or don’t pay their medical bills. Cook County Health expects to provide nearly $600 million in medical care this year the system will not get paid for.
“None of these are surprises”
The preliminary shortfall comes after the health system already cut hundreds of vacant jobs to tighten its belt. Leaders are also reviewing contracts with vendors and making sure each new employee they hire is necessary.
Reprioritizing projects, like the new Provident, also is on the list. Breathing new life into Provident was among a flurry of proposals in Cook County Health’s bold strategic plan. Preckwinkle even touted Provident’s makeover in her October speech about the 2020 budget, saying investing in the hospital would help address major health disparities on the South Side and in southern Cook County.
During a health system board meeting on Friday, Cook County Health leaders and board members discussed the half-billion-dollar shortfall. They touched on many of the reasons Rizki mentioned.
“One of the things that troubles me is that none of these are surprises,” board member Mike Koetting said. “We’ve known about these all year.”
Others underscored the bigger problem that keeps getting worse: treating a rising tide of people for no pay.
James Kiamos, who runs CountyCare, flicked to a potential bright spot. He said the state plans to automatically assign more Medicaid recipients to CountyCare, which would boost enrollment and potentially drive more money to the health system.
Kristen Schorsch covers Cook County politics at WBEZ. Follow her @kschorsch.