Information provided by Hazel Hawkins Memorial Hospital
Hazel Hawkins Memorial Hospital announced California Nurses Association members agreed to postpone their 3% pay increased for 90 days, in consideration of the hospital’s financial crisis. The release said the postponement can be extended. As part of a new four-year contract agreement in July, the union and the hospital agreed on a 12.5% across-the-board wage increase which includes a 3.5% increase in the first year.
“The impact is approximately $16,000.00 per pay period,” the hospital said. “All deferred payments will be made retroactively at the end of the postponement.”
Registered nurse Patty Young, who works in the ER, said, “I back keeping this hospital open 100%, I’m completely supportive of forgoing any increase in pay to help the hospital remain solvent. I’m fully aware of how vital this hospital is to our community.”
The release said the National Union of Healthcare Workers also has agreed to extend their current contract which impacts any wage increases they may have received because of negotiations but it did not provide details on the impact.
“This is very helpful to our cash flow issue and we appreciate it greatly! The dedication and support our staff has for the hospital is tremendous,” said Hazel Hawkins Chief Clinical Officer Barbara Vogelsang. “Thank you all!”
Hazel Hawkins told BenitoLink interim CEO Mary Casillas’ salary is $310,500 but is “participating in the 10% salary reduction, so she is currently receiving $283,500.”
The hospital said Casillas’ salary before her promotion from Chief Operating Officer was $270,000.
On Nov. 4, the San Benito Health Care District, Hazel Hawkins’ governing board, declared a fiscal emergency, allowing the district to file for Chapter 9 bankruptcy. In that meeting, Chief Finance Officer Mark Robinson told its board of directors Nov. 4 that several factors led the hospital to need the option of filing for bankruptcy. Those factors which included an obligation to return over $12 million to the state this fiscal year, an Anthem Blue Cross reimbursement dispute and a delay in supplemental payments totaling $13 million due to the hospital from the state.
According to the hospital, 745 employees and 41 active physicians were on staff in 2021. It reported that last year it had 23,594 emergency department visits; 2,319 hospital admissions; 42,981 outpatient visits; 83,679 clinic visits; and 439 infant deliveries.
The hospital asked the county for a $10 million loan. On Dec. 15, the San Benito County Board of Supervisors approved a $2.24 million advancement to the hospital in property tax revenues but the hospital was due 50% of that amount by the end of the month regardless of the supervisor’s vote.
On Dec. 19, the hospital sent notices to its employees of possible mass layoffs and possible closure. According to the notice, the hospital said it has enough funds to operate until Feb. 18. The notice stated that the Worker Adjustment and Retraining Notification (WARN) Act can be extended or retracted if Hazel Hawkins is successful in finding funding. The hospital said it needed to come up with an additional $25 million to avoid bankruptcy.
On Dec. 28, Hazel Hawkins announced a new reimbursement agreement with Anthem Blue Cross. The new agreement took effect Jan. 1. BenitoLink has requested but not received more information on the agreement and how it will impact the hospital.
The hospital has been “out-of-network” for Anthem PPO members since Aug. 10, 2022. During negotiations, Hazel Hawkins said Anthem was refusing to “appropriately pay Hazel Hawkins Memorial Hospital for health care services.”
Anthem said it “offered reasonable increases that are in line with what other provider partners receive for the same services.”
Before the hospital declared a fiscal emergency, it terminated its contract with then-CEO Steve Hannah on Oct. 14. that included $360,563 in severance pay. Hannah’s contract expired June 30, 2025.
In an exclusive interview, Hannah told BenitoLink in July 2022 the hospital has until 2030 to make its current building capable of surviving an earthquake of 8.0 magnitude on the Richter scale. Hannah said the hospital needed to expand and is looking to build a new $250 million hospital. With board approval, the hospital also purchased the Oasis Fitness building at 190 Maple St. near the Hollister Post Office for $1.9 million in cash on April 20, 2022.