The clock is ticking for Hennepin Health Care to find $50 million in savings - or else.
Hennepin Health is asking its employees to help identify possible cost-saving measures as it looks make at least $50 million in cuts by the end of March.
But that won't fix the problem entirely according to Hennepin County Commissioner Jeff Lunde.
"The federal government has changed reimbursements, and so those reimbursements, we know for Hennepin Healthcare, is gonna be about $1.7 billion over 10 years," explained Lunde talking to Blois Olson on WCCO's Sunday Take. "So, we know the headwinds coming are gonna be that, if we were great at $0, every year we've got to come up with $170 million of cuts."
Lunde says that they plan to ask the legislature to change how the sales tax revenue at Target Field is used so that Hennepin county taxpayers wont be the only one footing the bills.
"If we don't get that sales tax, we will be having a different discussion," he says. "And that discussion will be what happens when you get that burn in Bemidji and you need a place. HCMC, if it's not open and I say those words very specifically, if it's not open, no care gets provided. And so, that's our challenge."
Another answer for Hennepin Health is to look at more local partnerships.
"We're gonna expand our partnership with North Memorial because their mission of their hospital is similar to ours," says Lunde. "They are, you know, people who serve patients as they come. But we need to invest in Hennepin Healthcare going forward."
Lunde says despite that name of Hennepin Healthcare, 40% of the patients who arrive at the facility are not from the county.
"The percentage of people who come from outside Hennepin to our hospital, and we receive them, we give them great care, we welcome them, but all the costs are borne by the property tax owners in Hennepin County," he adds. "And so, that sales tax allows us to capture, and according to our calculations, probably about 24% of the sales tax would come from outside Hennepin. And we think that's fair."
Lunde says the hospital actually was a department within Hennepin County up until 2007, and at that time with approval from the state legislature, they created a shared subsubsidiary, making HCMC is a wholly-owned subsidiary of Hennepin County.
"That allows it to have some of the benefits, but also have some independence, and it was really meant to be, you know, let them run themselves, have professionals there," Lunde told WCCO's Blois Olson. "But yeah, at the end of the day, you know, their budget is ultimately approved, it was at every year, we have oversight, we have insight, hopefully.
COVID started to change the game, as it has for many healthcare systems across the U.S.
"I think, as some of the healthcare costs started to shift, where costs were being born more and more locally with hospitals having to pick up burdens, you know, state and federal aid were not keeping up with the cost," Lunde added.