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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Washington state hospitals lose nearly $400 million in first nine months of 2024, Providence loses $66 million in Spokane area

Providence Sacred Heart Medical Center is seen from downtown Spokane.  (Jesse Tinsley/THE SPOKESMAN-REVIEW)

Hospitals in Spokane continued to bleed tens of millions of dollars last year – even as the losses slowed from those of 2023.

During the first nine months of 2024, Washington state hospitals collectively lost $398 million dollars, according to a survey conducted by the Washington State Hospital Association. Spokane hospitals had their fair share of red ink.

New York University health care finance professor Julius Wool said the largest cost pressure on hospitals is labor, which has increased exponentially since the COVID-19 pandemic. Drug costs are also increasing, and medical equipment needs to be replaced much more frequently than in the past.

Sacred Heart and other Providence hospitals in the area collectively lost $66.2 million in that time. MultiCare Deaconess Hospital lost $38 million, and its sister Valley Hospital lost $4.5 million.

Providence Inland Northwest CEO Susan Stacey called these losses “unsustainable” and said her hospital system likely could not maintain its level of care if there is another pandemic-level event. Losses at Providence are covered by its reserve fund.

In 2019, Providence Inland Northwest had 191 days of cash-on-hand. As of the third quarter of 2024, the health care provider that opened its first hospital 139 years ago in Spokane had half that – enough in reserves to cover 96 days.

“Having less than 100 days cash on hand means if another pandemic or another crisis hits, we simply won’t be able to maintain our current operations,” Stacey said.

MultiCare remains prepared to provide Spokane with care despite its financial setbacks, spokesman Kevin Maloney said.

“Health care organizations across the country are facing financial challenges and MultiCare is not immune,” he said in a statement provided Tuesday. “MultiCare is committed to serving this community with high-quality health care. Since our founding in 1882, the people of MultiCare have always risen to challenges and we will do so in 2025 and beyond.”

In state Department of Health data, the only health care system to not report losses in 2024 was Inland Northwest Behavioral Health. The for-profit mental health facility made just over $15 million, according to the state data. When Providence closed its Psychiatric Center for Children and Adolescents last year, patients were directed there.

Hospital losses in Spokane and across Washington state faced much deeper losses in 2023. While hospitals in the state saw a collective 1.3% net loss in the first nine months of 2024, the loss over that same time in 2023 was 5.1%.

Hospital association CEO Cassie Sauer noted that while the situation is “not rosy,” hospital losses have “slowed.” The improved outlook, she said, comes from the implementation of the Hospital Safety Net Assessment program, a policy passed by the Legislature in 2023 that increased hospital Medicaid reimbursement rates.

Without the increase in Medicaid funding, hospitals would have lost $1.2 billion from operations during the first nine months of 2024, according to the WHSA.

Based on Department of Health data, Providence had a 2023 operating loss of $175.5 million at its Sacred Heart Medical Center. MultiCare Deaconess Hospital lost $70.9 million. At the time, Deaconess Hospital disputed the losses reported by the state.

“With all these cost pressures, you’ve got the perfect storm,” Wool said. “These hospitals that have a large percentage of patients who use Medicaid are not surviving without subsidies.”