SeHealth Announces Changes in Response to Financial Impact of COVID-19

Lumberton, N.C. (June 1, 2020) – Southeastern Health has announced a series of changes in response to the financial impact of the COVID-19 pandemic.

“The last few weeks and months have been a challenging time as we’ve worked to navigate the unprecedented impacts of the novel coronavirus,” said Joann Anderson, SeHealth President and CEO. “We have worked diligently to protect our patients and employees and treat members of the community who have been affected by this virus.”

From the onset of the pandemic, SeHealth quickly adapted services which included temporarily suspending non-essential procedures and other services to prepare for an expected surge in COVID-19 patients.

“We followed federal and state direction and mandates directing the suspension of non-essential services,” said Anderson. “While these actions were necessary, they have impacted our organization’s financial position in a very real way. The unplanned expenses associated with securing additional supplies and protective equipment, coupled with the significant drop in volumes as a result of suspending non-essential procedures, have left our organization in a serious financial situation. While we’ve taken immediate action to address some of these challenges, it’s become clear we must take additional measures to protect our ability to secure access to safe, high-quality care for the residents of our community both in the short- and long-term.”

Starting today, SeHealth will be making the following changes to help ensure the organization’s financial stability in this challenging time:

First, SeHealth will decrease compensation for the organization’s most senior leaders, including a 46 percent reduction in total compensation for President and CEO Joann Anderson.

Second, SeHealth will be improving efficiencies by reducing the organization’s physical footprint. This will involve:

• Permanent closures of the Maxton and White Lake clinics. Patients of those facilities will be transferred to other clinics, and SeHealth will continue its work to expand telehealth services for all primary care patients.
• Closing the Neurosurgery clinic and transitioning the care of those patients.
• Shifting focus to inpatient behavioral health services and transitioning outpatient behavioral health services to other providers in the community.
• Consolidating outpatient physical and occupational therapy services.

Third, SeHealth will be adjusting some employee health benefits.

Fourth, the organization is evaluating a number of departments for potential outsourcing of services, aiming to optimize operations.

Lastly, and most difficult, SeHealth is eliminating 236 positions (about 22 percent of administration and 10 percent of the total workforce), including two vice presidents. About 40 percent of the positions being eliminated will be realized by not filling vacant positions, attrition, reassigning staff to new roles and retirements. However, these changes will impact the employment of 147 employees.

“These were not easy decisions to make, and we do not take the impact it has on our colleagues lightly,” Anderson said. 

“We have done everything possible to preserve jobs,” said Kenneth Rust, Chair of the SeHealth Board of Trustees. “Nonetheless, we realize this does impact a number of our team members and we are doing everything we can to support them in this time.

Severance benefits are being made available to eligible impacted employees. Depending on each individual’s circumstance, some options include an extension of current employee benefits, a pay out of one’s current PTO balance, a severance payment, and/or a workforce retraining program.

SeHealth is not alone in these challenges, as hospitals throughout the country – especially community hospitals in more rural communities – are working to respond to the financial consequences of the pandemic. While SeHealth did receive funding from the federal and state government through the CARES Act, the reality is the funding covers only a very small portion of operating expenses.

“This is a difficult day for all of us,” Anderson said. “The loyalty and dedication our people have shown the community we serve is not lost on any of us. We’ve all been challenged and stretched in different ways as we’ve dealt with the personal and professional impacts this virus has had on our lives.”

In the coming months, the SeHealth leadership team and Board of Trustees will continue to chart a smart path forward that takes into account the needs of the community while also adjusting to a new normal as a result of COVID-19. Rust said this important work will be conducted thoughtfully with the “best interest of our community at the heart of our decisions.

“We’re saddened to be in this situation, but we’re confident the tough decisions we’re making today are what’s best for our organization in the long-term,” he said. “The continued strength, resiliency and dedication of this team is remarkable. As we move forward, we will continue to face what’s ahead with that same spirit. Right now, our focus continues to be on providing the safe, high-quality care our community needs.”