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Federal coronavirus loans helped Colorado’s rural hospitals stay afloat

Many of Colorado’s rural hospitals are the community’s top employer and the only provider for hundreds of miles

Wray Community District Hospital practice caring for patients while wearing personal protective gear. (Provided by Dr. Lindsey Paulson)

By Patty Nieberg, The Associated Press/Report for America

More than a dozen rural Colorado hospitals and primary care facilities applied for federal loans designed to keep staff employed during the coronavirus pandemic, federal data show.

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The loan approvals came as rural hospitals across the country struggle with dwindling income, higher costs and staff retention, a plight exacerbated by the pandemic, according to the Colorado Hospital Association.

The federal Paycheck Protection Program helps smaller businesses stay open and keep Americans employed amid the coronavirus pandemic. Under the program, the government is backing $659 billion in low-interest business loans that will be forgiven if employers use the money on payroll, rent and similar expenses. Companies typically must have fewer than 500 workers to qualify.

About $130 billion was unclaimed as the application deadline closed June 30. With money still available, Congress voted to extend the program to Aug. 8.

Many of Colorado’s rural hospitals are the community’s top employer and the only provider for hundreds of miles, said Cara Welch, director of communications at the Colorado Hospital Association, which represents 43 rural hospitals in the state.

From the onset of the pandemic, the hospitals were focused on maintaining appropriate supply, staff and space in order to respond effectively to the virus in their communities, Welch said. As the crisis worsened, they began to see more expenses and less revenue from non-emergency and elective procedures which were suspended by an executive order from Gov. Jared Polis in March.

Although rural hospitals were exempt from the order, many opted to preserve their personal protective equipment and prepare for a potential outbreak.

“Many of them were operating at a very thin margin, if not possibly a negative margin,” entering the pandemic, Welch said. Other health systems have larger resources or investment portfolios, she said.

MORE: The view from a hospital on Colorado’s Eastern Plains as it works to avoid being overrun by coronavirus

The CHA is projecting $3-4 billion in revenue losses and increased expenses.

One hospital that received a federal Paycheck Protection Program loan is Kit Carson County Health Service District in Burlington. It’s a 19-bed critical access hospital which serves a community of a about 7,000 people on the Kansas state line.

Carson, with a 135-person workforce, cut non-essential services during the pandemic. Management furloughed 25 workers and 66 more were put on reduced hours. After the hospital received its PPP loan of between $1 million and $2 million on May 1, it was able to cover the entire workforce for May, June and the first July payroll, district controller Doug Satterly said.

“We’re not up to full capacity yet but we’re slowly getting there,” Satterly said.

About 15% of the U.S. population, or more than 46 million people, lives in rural areas, according to the U.S. Census Bureau. They are more likely than urban dwellers to die from chronic respiratory illnesses, heart disease and other problems that put people more at risk for COVID-19, the illness caused by the virus, according to the U.S. Centers for Disease Control and Prevention.

“We are actually a very critical location because the closest hospitals are in Denver which is about a two-and-a-half-hour drive,” said Duane Wright, Carson’s interim chief nursing officer. “Most of our patients have to be flown out of here in order to get to Denver in a timely manner. We rely on a lot of air and helicopter transport in order to facilitate that.”

TODAY’S UNDERWRITER

For most people, the coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia, and death.

Rural hospitals and health centers in Rangely, Hugo, Wray, Yuma, Sterling, La Junta, Gunnison, Walsenburg, Kremmling, Estes Park, Lamar, Alamosa and Craig were among those approved for loans between $1 million and $5 million, according to data the federal government released Monday.

The entrance to Lincoln Community Hospital in Hugo. The hospital, which is community owned, opened in 1959. (Provided by Lincoln Community Hospital)

Other organizations, such as the Denver Rescue Mission for the homeless and North Range Behavioral Health in Greeley, also qualified for loans, as did Denver-based Correctional Health Partners, which offers administrative and medical services to jails and the state corrections department.


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