Southeast health-care cutbacks cost jobs

It’s easy to argue that the healthcare industry is an important part of Southeast Alaska’s economy. Hospitals are major employers — if not the largest employers — in many of the region’s communities. And then there are other services, such as air ambulances and clinics.

But while some operations are expanding, others are cutting back. And that’s left some medical staffers without a job.

For seven years, Gale Kehres worked in one of the best offices in the world. At least that’s what she’ll tell you.

“I get to see the mountains and I get to see the glaciers, and I get to see animals. We can take pictures if it’s on a leg of the flight that we don’t have a patient,” she says.

Kehres was a flight nurse for SEARHC, the Southeast Alaska Regional Health Consortium. It was her job to travel with, and care for, patients as they were medevaced to Anchorage or Seattle, either 600 miles northwest, or 800 miles southeast.

But at the end of September, she lost that job.

“They brought us into a meeting in our office and told us that we cost too much,” she says.

SEARHC changed the way it provides medivac services, and its flight nurses were given a choice: Look for a new assignment within the regional healthcare provider, or find a job elsewhere.

“And what I want to do, if I can’t fly, would be emergency medicine. I’ve done critical care, I’ve done medical/surgical nursing, I’ve done supervising and I’ve done day surgery stuff,” she says. “I don’t really want to go back to those things. I would want to work in emergency medicine. There are no current emergency medicine jobs available at SEARHC.”

SEARHC is arguably Southeast Alaska’s largest private employer, with 836 people regionwide. More than half of those work in Sitka.

But a huge portion of SEARHC’s funding comes from the federal government. Or it did, before automatic budget cuts known as sequestration took effect. SEARHC blames federal cutbacks for a series of changes it has made in the last several months.

It closed its residential substance abuse treatment program. It put an indefinite hold on its community health aide training. Its Front Street Clinic in Juneau was targeted for closure and has only stayed open through independent fundraising.

“You make the hard choices now so the future choices will be more clear-cut,” says CEO Charles Clement.

“When we’re forced to look within to decide what it is that is most in alignment with our core mission and vision, that’s really the struggle. It doesn’t come down to one person making a decision, it doesn’t come down to two people making a decision, it doesn’t come down to people making decisions in haste. It comes down to lots of conversations, and lots of very difficult conversations,” he says.

Clement says the conversations at SEARHC are changing, though … “from what it’s going to take for us to survive, which is the conversation we’ve been having for the last X many months, years, to what it’s going to take for us to thrive. ”

Just a couple miles from SEARHC’s Sitka campus, the picture is a little rosier.

“Our employment has grown 15 percent since 2009.”

Hugh Hallgren is the administrator of Sitka Community Hospital, a 12-bed facility owned by the city. Back then, it had about 150 full-time equivalent employees. Now, that number is closer to 175.

The hospital has emphasized growing its outpatient business and added other services, too.

“Neurology, urology, cardiology. Plastic surgery is a big crowd-pleaser here,” he says.

That’s reconstructive surgery, as well as cosmetic, Hallgren adds.

Comparing SEARHC and Sitka Community Hospital is comparing apples to oranges. They’re funded differently, they serve somewhat different populations, and one is much larger than the other. But still, two hospitals in the same town, with different economic pictures, at least illustrates how hard it is to track the health care industry.

Here’s what we do know: Last year, more than 3,200 people worked in the health care industry in Southeast Alaska. That’s up 4 percent since 2010. And the industry pays out more than $162 million in wages to its employees in the region. That’s also up from 2010, by about 9 percent.

To understand economic impact, analysts look at something called a multiplier. It’s a measurement of where the money goes after it’s been spent in the region. You take ten bucks you made and spend it at the grocery store, which then pays it to one of its employees who then spends it (at) at the drugstore, which… you get the picture.

Jim Calvin is with the Juneau-based McDowell Group.

“We have relatively low multipliers in most sectors of the Alaska economy, because we manufacture very little. All of the food and clothes and furniture and cars we consume are manufactured outside of our state,” he says.

So money leaves pretty quickly. And painting a picture of the exact economic impact of health care on the Southeast economy is very difficult. Still, Calvin says one thing is clear:

“It’s been one of the fastest growing sectors in the Alaska economy for the last 10 years. Will it continue to grow at that pace? Probably not. But we do expect as the overall population increases, and as the senior population in particular grows, that we’ll see increasing healthcare related activity in the economy,” he says.

Now that we know all that, what does it mean for Gale Kehres, the flight nurse we met at the beginning of the story?

“If I can’t get a job here in Sitka, I have a couple options. I can become a travel nurse, or I can move away from Sitka,” she says. “I would rather not move away from Sitka. I really like living here. But if that’s what the future holds, then that’s what I’ll have to do.”


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