Fairbanks Hospital Loses Millions To COVID-19

Apr 21, 2020

Fairbanks Memorial Hospital North Entrance with "Mask Up" message.
Credit Robyne / KUAC

The non-profit group that runs the hospital and large medical clinic in Fairbanks is reporting huge financial losses from the COVID-19 pandemic. Not only is revenue down, there have been big costs in preparing for a surge of sick people. 


COVID-19 has hit Foundation Health Partners pretty hard. The partners are Fairbanks Memorial Hospital, Tanana Valley Clinic and Denali Center, the long-term care facility.

Gary Roderick, the group’s Chief Financial Officer, says there is a compounding effect of taking no elective procedures combined with closing service lines, both of which brought in money in direct and insurance payments and reimbursements from Medicare and Medicaid.

“We’re only taking emergency surgery, so that brought our surgery department down quite a bit. Of course we’ve closed a variety of contact services to properly protect our staff and our patients.

And here are numbers:

The big Tanana Valley Clinic revenues were down 9% in March and 65% so far in April, compared to last year.

Fairbanks Memorial Hospital revenues were down 22% in March and 40% so far in April, compared to 2019.

You know, the Greater Fairbanks Community Hospital Foundation, its yours, its mine, its everybody's who is listening to this. Its owned by our community.

Roderick says years of frugal leadership have kept the hospital in a solid financial position, but finding a way through the pandemic will challenge that.

“Its going to be extremely difficult. My modeling predictions throughout a pandemic, without knowledge of when it is going to be over, makes the modeling very, very difficult.”

Safety, of course, trumped revenue when preparing for the pandemic, and the hospital and clinic made some huge changes in operations. For example, the nurses who were in those contact services like Dermatology and Gynecology checks? They are now at the testing tent outside the Emergency Department or at the drive-through test center. And some of them are answering the new COVID-19 Hotline.

“We have been able to reassign much of our staff to COVID preparedness.”

Remarkably, Foundation Health Partners has not had to lay off or furlough any employees. While for-profit hospitals in the lower-48 are laying off nurses during a pandemic, this non-profit hospital is downsizing through attrition.

“If we were a for-profit entity, profit would be higher on the list of priorities. It’s important to us. Don’t get me wrong. We have to remain viable.”

Roderick says the CARES act passed by Congress will help a little, and more federal funding during the pandemic is needed. But it is Interior Alaska who has invested in its community hospital.

 “You know, the Greater Fairbanks Community Hospital Foundation – its yours, its mine, its everybody’s who is listening to this. Its owned by our community.”

Last week the state health department issued Health Mandate 15 that will allow some medical services to resume but only if they cannot be delayed beyond eight weeks without posing a significant risk to quality of life, and only if providers are able to test patients for COVID-19 before the procedure.