More on Houston Flood & Nursing Shortage: Financial Hardships

Home Health Columnist / Guide · Jul 9, 2001

Nurses shortage, flood crisis leave hospital district gasping for cash

By STEVE BREWER

http://www.chron.com/cs/CDA/story.hts/metropolitan/961015

In the midst of a continuing struggle to dig out of a financial hole, the Harris County Hospital District could start bleeding red ink again if officials don't find a way to address a nursing shortage made worse by Tropical Storm Allison.

Larry Finder, chairman of the district's board of managers, is organizing an emergency board meeting next week to address the latest crisis facing the taxpayer-supported health system.

"I'm concerned we may not have the financial resources to get through the rest of the year due to this emergency," Finder said. "This is putting a great financial strain on our system."

Last month's flooding closed down many hospitals in the area, but left the district's trauma centers at Ben Taub and Lyndon B. Johnson hospitals operational.

That's meant a crush of business for those facilities, especially Ben Taub, which is the only Level 1 trauma center now open in the city. Officials say that might have been manageable, except for one factor -- even before the remnants of Allison drenched the city there was a nursing shortage in the district.

Now, staffs at Ben Taub and LBJ are coping with more business than they would get during a normally hectic holiday period, and they're doing so with less help.

Amid calls from doctors and hospital administrators for an emergency infusion of cash to address the problem, Finder said there might only be three short-term solutions for the district -- pay more overtime, call on retired nurses who want to earn extra money and hire contract labor.

He said those solutions, while sorely needed, could throw the district's latest plan to emerge from its financial mess "out of kilter."

Members of Commissioners Court share that worry and, along with district administrators, vow to push for some type of disaster relief from the federal government that could be specifically earmarked for the district.

"This greatly concerns me," Commissioner Steve Radack said. "Whenever you're dealing with an indigent health system as massive as Harris County's, one that people even from outside the county depend on, you can bet there's a chance taxpayers will have to foot a bigger bill in situations like this."

County Judge Robert Eckels agrees it's not too soon to worry. But, like Finder, he's not ready to say the crisis will force the court to consider an increase in the district's share of the overall tax rate.

"I don't think this is the time to talk about that," Finder said. "It's not the time to say this is something that will be used in budget negotiations on the tax rate. We have to stay focused on getting through the summer because this is an issue that really does affect every resident of Harris County."

The overall county rate, set by the court in the fall, is divided among the hospital district, flood control, the county and the Port of Houston.

In the past two years, political pressure to avoid service cuts has prompted the court to increase the district's share of tax money by 64 percent. Last year, the county pumped $107 million more into the district, bringing the taxpayers' share of its $560 million budget to $304.6 million.

This year, the district asked for $315.6 million in tax money to support a budget forecast of $583 million in income and $553 million in expenses.

That's an $11 million increase in tax support. But, when the budget was approved earlier this year, officials said that was a relatively small increase compared to previous years and, they added, it was doable considering the windfall governmental coffers will reap from skyrocketing property values.

Also, a key component of the district's new budget that made it palatable for the court was a plan by John Guest, district president and chief executive officer, to increase revenues and add $30 million annually to reserves during the next five years, without relying heavily on taxpayers.

At the time, the plan was widely touted as the first step toward fiscal stability. Guest jokingly said it might signal that, financially, the district is "out of the fire and back in the frying pan."

Now, with the nursing shortage and Allison's aftermath, Finder, Radack and others are wondering whether the work to improve the district's cash situation will now crash, just as it's getting off the ground.

Guest couldn't be reached for comment. But, Clifford Bottoms, the district's chief financial officer, said it's too early to have such concerns.

The district is about $6 million ahead of its budgeted revenue projections so far this year, he said, and some of the solutions Finder mentioned for dealing with the nursing shortage already have been implemented to various degrees, without straining the budget.

"This will not wreck our (financial recovery) plan," Bottoms said, "It will put a dent in it, certainly. We just don't know how big that dent will be yet."

Bottoms said he has no numbers yet on how the district fared financially in June. He is working on those and should have them ready by next week.

He said there probably will be some extra overtime costs that can be attributed to the storm, the nursing shortage and the strain on the trauma centers,.

But, he added, some of those costs might have been there anyway.

"If we had not had Allison, we would have still been complaining about not having enough nurses," Bottoms said.