Bartlett Regional Hospital faces a $7.5 million budget deficit for the next fiscal year. To cover the shortfall, the hospital must use its savings, a strategy the board deems unsustainable. Max Mertz, the hospital board’s finance committee chair, discussed the causes of the deficit and potential solutions during a joint meeting with the Juneau Assembly.
“We only have enough cash to last for three more years before we would have to shut down,” Mertz said. “Without major changes to our operations, we won’t be able to make payroll.”
Mertz noted that the hospital’s budget crisis has been building for years. Since 2019, revenues have fallen short of covering costs. Starting in mid-2020, the hospital has been losing approximately $1 million each month.
Hospital leaders attribute the loss to increased labor expenses, the depletion of temporary pandemic relief funds, turnover among staff and leadership, and inadequate insurance reimbursement rates. Previous attempts to address the situation, such as implementing hiring restrictions and reducing overtime, have yet to prove enough.
“We’re faced with tough decisions regarding our path forward,” he stated.
Now, the board is contemplating reducing or eliminating “non-core” services causing financial strain. These include the Rainforest Recovery Center, Home Health and Hospice, crisis services, and support for children with autism.
The board emphasized that cutting services would only be considered a last resort. They are exploring options such as using city funds to subsidize the programs, transferring them to other providers, or implementing other creative strategies to improve the financial situation.
However, no options are ruled out at this stage. According to Board President Kenny Solomon-Gross, they will hold meetings in the upcoming weeks and seek input from the community.
“One of the advantages of having a community-owned hospital is that we, as a community, have the opportunity to decide which services we prefer,” he remarked.
During the meeting, a few residents and hospital staff attended to advocate for specific services that might be cut.
Juneau resident Mary Alice McKeen stressed the importance of continuing Home Health and Hospice services. Bartlett Regional Hospital started offering these services last summer, assuming the responsibility after Catholic Community Services ceased providing them in 2022.
The home health program offers periodic in-home care for individuals recovering from illness or surgery, while hospice care is for patients with a life expectancy of six months or less. McKeen emphasized the necessity of both services.
“I find it unimaginable for a city of 30,000 people not to include hospice care as part of its healthcare system,” she remarked. “It’s inconceivable to me that we would regress to a time where people’s only options were to pass away in the hospital or at home without proper expertise or assistance.”
Mertz indicated that those programs are projected to incur a combined loss of $1.3 million in the next fiscal year.
Those providing testimony emphasized the importance of maintaining services at the Rainforest Recovery Center.
Bartlett Regional Hospital has overseen operations at this substance misuse treatment facility since 2000. However, it has experienced consistent financial losses due to the depletion of grants and tax revenue. The hospital anticipates a loss of nearly $800,000 for the center next year.
Jeni Brown highlighted that discontinuing the center’s services would impact Juneau residents and others beyond the city.
“I’m here to emphasize the crucial importance of these services for everyone in Southeast Alaska — indeed, for all Alaskans. These services are essential for saving lives,” she asserted.
Juneau serves as a regional center for providing such services to communities in Southeast Alaska that lack them. Additionally, for residents of Juneau, access to these services means quicker treatment without the need to travel to cities like Anchorage or Seattle.
Brown, drawing from her own experience of overcoming addiction and incarceration, emphasized the critical role of services like these in providing hope to individuals battling addiction — services she credits for her survival.
“For many of us, this lifeline must remain open. These resources are essential for us to take the necessary steps to reintegrate into the community,” she stressed.
Residents also supported other programs, such as adolescent and adult crisis services.
Assembly members provided limited insight into their views regarding which services should be prioritized. Mayor Beth Weldon expressed her interest in gathering input from the community.
