Gifford Medical Center has served patients across the White River Valley for over a century. A year ago, they were in a financial crisis. Since then, the medical center has worked to turn things around. All photos © Lexi Krupp
When Michael Costa started working at Gifford Medical Center a year ago, the Randolph hospital was losing over $1 million each month. Most nights, only a third of the hospital beds were full, while primary care offices were booked and their waiting lists ran over 600 patients long.
Those problems were underscored by a bombshell report that came out last fall, just a few days before Costa started his new job as CEO. It said Gifford faced an existential crisis and needed to close or restructure their inpatient beds to avoid going under.
“My spouse heard about it on the radio and said, ‘That's not your hospital, is it?’ And I said, ‘Yep, that's Gifford,’" Costa, who lives in Norwich, recalls.
These days, he thinks the report, commissioned by the state, was actually a gift. He does not agree with its conclusions, but says it added urgency to problems that had been brewing for years: The number of patients admitted to the hospital dropped during the pandemic and never recovered (“During the depths of COVID, complicated patients, particularly if they had a respiratory issue, were sent to larger hospitals like Dartmouth and UVM. And I think once that started to happen our census dropped lower and lower,” Costa explains now). Moreover, the rollout of a new electronic health record caused billing issues that meant the hospital wasn’t consistently paid for the care it provided. And the cost of temporary staff, along with equipment and drugs, had soared.
A NEW CHAPTER
Gifford is still not breaking even, but it’s a lot closer, and is projected to be in the black within a year. That’s thanks to a number of reform efforts across the medical center and its five clinics, spread out between Sharon and Berlin, that serve over 15,000 patients a year.
Michael Costa began working at Gifford last year, after working in state government for much of his career. He also coaches his kids’ baseball team in Norwich.
First came the cuts. In the early weeks of his tenure, Costa laid off two administrators and several clinicians: a uro-gynocologist and two chiropractors. He said those reductions were chosen to have as little impact on the community as possible — other chiropractors in the area could pick up Gifford’s patients, while remaining urologists and gynecologists on staff could care for patients who had gone to the subspecialist.
At the same time, Gifford began telling bigger hospitals like Dartmouth Hitchcock Medical Center in Lebanon and the University of Vermont Medical Center in Burlington that it could accept more transfers of patients needing hospital-level care.
“It really was a messaging change,” says Dessa Rogers, a nurse who oversees the emergency department and the inpatient unit. “This is what Gifford can do, these are the kind of patients we can take care of, these are the kind of specialists and services that we have.”
So far, larger hospitals like Dartmouth have been taking them up on the offer.
“When they're full in their ER, they'll give us a call and ask if we have capacity to take a patient,” says Rogers, who has been working at Gifford for decades, since she was a teenager. “Patients have to agree, but it seems to be working out.”
Over the past year, Gifford has doubled the number of patients staying overnight at the hospital, from an average of eight to 16. That includes people who live close by, and others from farther afield in Vermont and New Hampshire.
And the hospital feels different. “Some of our most experienced team members have come up to me and been like, we used to be busy like this all the time,” Costa says. “Our lab used to do orders like this all the time.”
An old photo that hangs in Costa’s office shows Gifford’s pediatric office building.
The move is part of a bigger strategy to make Gifford essential to the state’s health care system by serving as “a pressure release valve.”
“How do you make sure that somebody from Braintree doesn't get stuck in a bed at Dartmouth when they don't need that,” he says. “Or if Dartmouth's full, how do you make sure someone from Chelsea doesn't get sent to Springfield or Albany or Hartford, Connecticut?”
That’s a reality that happens too often, according to Randy Garner, a longtime funeral director in Randolph and a former board member of the hospital. “We have noticed an uptick in the past several years of local residents going to far off places for their final days,” Garner said last year, during a community meeting about Gifford.
“I can’t tell you how many times I’ve been to Albany, NY,” he said, explaining that’s because critical care beds at Dartmouth are full. “Some of those patients could be coming back to us.”
Costa thinks Gifford could also play a bigger role in reducing wait times for routine procedures, like mammograms or colonoscopies, that are often backed up for months at other hospitals across the state. At UVM Medical Center, the waitlist for a colonoscopy is over 3,000 patients long, according to testimony from the hospital president earlier this year.
Not so at the Randolph hospital. “Gifford, for the most part, can get you in quite quickly,” Costa says.
Many of the other changes at the hospital over the past year have been more mundane, like overhauling scheduling practices to allow more patients to get primary care appointments. Gifford is now accepting new patients. That doesn't necessarily make much money for the hospital (primary care has a notoriously low reimbursement rate from insurance companies), but it does allow them to provide good health care to the community. And Costa thinks the primary care patients they serve might be more likely to choose Gifford for other services when they need them.
ON-SITE TRAINING AND LONG-TERM INVESTMENTS
In the coming year, Gifford officials think they will have fewer contract staff than they do today. That’s in part because of efforts to grow their staff by training early-career clinicians. This spring, Gifford hired a class of eight nurses who had just graduated to serve in a new year-long training program.
The nurses get clinical experience, go through simulated scenarios, take online lessons, and work with mentors. And they’ve been a big help as the number of hospital patients at Gifford has grown.
The marble statue in front of Gifford was carved by Jim Sardonis in the 1980s, the same artist who created Vermont’s iconic whale tails, after his family received care at the hospital.
The hospital has a similar plan to serve as a training ground for primary care doctors in their first three years after medical school. Its leaders want to host a residency program in conjunction with other community hospitals in Vermont. It’s already got accreditation and funding from the state, but it’s been delayed a year. New primary care doctors wouldn't start until the summer of 2027, at the earliest, because of changes to federal policies.
STAYING ABOVE WATER
All these efforts are aimed at helping the hospital break even without raising prices.
“You can't ask your customers to pay more — your patients to pay more — each and every year, forever,” Costa says.
That’s exactly what has been happening across the state. For years, price hikes were the default solution to fix budget holes at Vermont hospitals. The tendency has led to health insurance premiums that are now the most expensive in the country by some metrics.
This year, the state’s hospitals have shown more restraint in their budgets, after pressure from state regulators and lawmakers.
Still, that’s come at a cost. Many have started closing patient services in response to financial challenges. In Morrisville, Copley Hospital shuttered its labor and delivery unit at the start of November, along with prenatal and postpartum care, leaving some residents without any place to receive pregnancy care or give birth within an hour’s drive. The inpatient psychiatry unit at Central Vermont Medical Center in Berlin closed at the beginning of the year, stranding patients who are in severe mental health crises. And Rutland Regional Medical Center announced it plans to close hospital beds designated for kids as soon as next month.
Moreover, the larger insurance picture is likely to create even more problems over the next couple of years. For many Vermonters, those expensive premiums will catch up to them this year, when a big chunk of federal subsidies that have helped subsidize health insurance expire. The biggest insurance companies in the state expect nearly 5,000 people to go uninsured starting in January, and many more are likely to lose insurance when changes to Medicaid policies go into effect after 2027. More uninsured patients means more unpaid medical bills for hospitals like Gifford.
“The hospitals aren't being paid, the red ink gets broader and deeper and it's already pretty red,” Green Mountain Care Board chair Owen Foster told lawmakers at the statehouse last month.
In an interview, Foster adds, “There’s so many headwinds coming at rural hospitals,” and it’s not clear whether Gifford’s strategy of trying to attract more patients can be easily replicated at other small hospitals in the state. “It's almost as if they're cannibalizing themselves because there's just not enough patients for particular service lines,” he says, especially since there’s not a big enough workforce in Vermont to provide care everywhere. “If everyone's trying to offer all these various service lines and everyone's relying on [traveling nurses and physicians], it just makes it more expensive.”
I asked Costa under what scenario Gifford might have to consider closing additional patient services to remain viable.
He didn’t have a straightforward answer.
“That's a hard question for me to answer, not because I'm evasive, but because I'm an optimist,” he said.
“We'll be doing the same thing we always do, in the sense, we'll take care of folks and then work really hard to make the finances and operations work together.”
Lexi Krupp is an independent journalist based in Burlington. She previously reported on health care for Vermont Public.