HARRIS, NY — Hospitals struggled alongside their patients during the COVID-19 pandemic. 

The Garnet Health hospital system, with campuses in Callicoon, Harris and Middletown, had its own experience with pandemic-era struggles. Facing a nearly $33 million deficit in the first months of 2022, it had to focus on its finances. 

Its struggles aren’t lessening its commitment to Sullivan County, it said; with new executive leadership, the system is working on its financial situation, and considering whether to renovate or replace its Harris campus. 

Finances

“We’re suffering a little bit financially from some of the things that happened over the last three years to every business,” Garnet Health CEO Jonathan Schiller told the River Reporter. 

Three factors affected Garnet Health the most, according to Schiller. A lot of people left the workforce—35,000 health care workers in NY, Schiller said—and Garnet Health has had to rely on traveling staff, which adds to the hospital’s costs. Inflation has made the prices of hospital equipment rise, while the hospital can’t raise the price of its services with a free hand, as it is bound in around 50 percent of cases by agreements with Medicare and Medicaid. And Garnet Health itself has seen “a downward fluctuation on utilization,” said Schiller, specifically of the hospital’s in-patient services: “If a patient comes in with chest pain and we observe them for a day, maybe five years ago that would be an admission to the hospital. Now, most payers will consider that an observation stay, that’s paid at a lower rate.”

These factors have affected health care providers nationwide. Garnet Health is working to manage them, but, said Schiller, “it’s probably another year before I’m 100 percent confident in our financial hurdles being cleared.”

Executive leadership

The hospital has experienced hands at the helm as it’s trying to navigate its financial straits. 

Schiller, now CEO of the hospital system, first joined Garnet Health in 2004. Jerry Dunlavey, now CEO of the system’s Catskill branch, first joined in 2001. 

The pair took a circuitous path to their current roles. At the start of 2022, Garnet Health brought in Al Pilong, who had most recently served as CEO of the Virginia-based Novant health system, to replace retiring CEO Scott Batulis. Around the same time, Schiller left his position as CEO of Garnet Health - Catskills to take up a role with the Rochester-area Oneida Health. 

“There came a time in early 2022 where it was an opportunity for me to grow—I thought I would have that opportunity here but it didn’t work out,” said Schiller. A professional contact recommended him for the CEO position with Oneida Health, in an area of the state where Schiller grew up and had family connections, and he agreed. 

Other family ties kept Schiller connected to the Sullivan County area, and after a year of splitting time a family situation helped him realize he was in the wrong place, he said. That’s when he got the call from Garnet Health. “[They said], ‘We’ve had some changes; would you be interested in coming back?’”

In the meantime, Dunlavey had been promoted, first in June 2022 to vice president of operations for Garnet Health and COO of Garnet Health - Catskills, then in December to interim president and CEO of Garnet Health as a whole, as Pilong left. 

“A lot of the focus when I arrived was on our financial performance, which is important because without financial performance, you can’t reinvest in your organization,” Dunlavey said. 

In a statement announcing the leadership changes, chair of the Garnet Health board Phillip Massengill said, “As COO of Garnet Health - Catskills, Jerry has begun to build strong relationships, and with his knowledge of the health issues affecting Sullivan County, I am confident he will be a strong advocate for the community and a great CEO for the hospital.”

Dunlavey pointed to his partnership with Schiller, and the meetings and the community outreach the two did with government and civic stakeholders within the county, as well as the system’s culture and community commitment. 

Hospital news

The Garnet Health system remains committed to Sullivan County, said Schiller and Dunlavey—though in different ways between its two campuses. 

The Callicoon campus in the western end of the county, also known as Grover Hermann Hospital, has the system’s full support, according to Schiller. The Callicoon campus has seen a steady level of patients served over the past 15 years, with upticks in the summer months. 

“I don’t think that hospital will ever go away,” Schiller said. “There’s so much community support for it, and there’s so much need for it, and it’s really the right size, it’s the right location, it’s the right mix of services and it works.”

The outlook is different for the hospital’s Harris campus, in the eastern end of the county. 

The current Garnet Health building in Harris was built in the 1970s, when the region had a booming tourist population. The population is different now—and with advances in medicine over the past 50 years, patients are under-utilizing the hospital’s current space. 

“There’s a tremendous amount of capacity that doesn’t get used, and yet, at the same time, we’re heating, we’re cooling, we’re cleaning a very large infrastructure, when… the core of the clinical service we’re providing is using much less of it than we used to,” said Schiller. 

Garnet Health has begun discussions about the right size, shape and location for the Harris campus, with options that may include building a new building or refurbishing the existing one. It’s going to take another year or two of study for concrete alternatives to emerge, said Schiller. 

The uncertainty doesn’t lessen Garnet Health’s commitment to Sullivan County. 

“We have invested in the past 10 to 12 years about $30 million in the infrastructure of both this building and our building in Monticello,” said Dunlavey. “An organization that is planning to close the hospital isn’t going to invest $30 million over the course of 10 years.”

Outcomes

The hospital’s investment is aimed ultimately at helping its patients and its community. 

Garnet Health measures itself with two benchmarks, said Schiller; it measures itself against itself, and it measures itself against hospitals across the industry. It aims to be in the top five percent of hospitals for the external benchmarks. “We think that’s what the community deserves, to be in the top five percent. Some programs are there, and others we’re always striving to get better and better and better.”

Among its recent achievements, Garnet Health - Catskills has achieved certification as a primary stroke center, ensuring that it is fully prepared to treat stroke patients.

“In stroke care, there’s a saying, ‘Time is brain,’” said Dunlavey; the longer it takes for someone to receive treatment, the more brain damage they sustain. Garnet Health’s certification means Sullivan County patients have local access to a hospital which can perform that treatment, cutting down on transport time, as well as ensuring that care gets delivered quickly once a patient enters the hospital.The system is also working to bring expanded primary care services to Sullivan County, said Dunlavey—encouraging patient health from a young age cuts down on the need for intervention and surgery in a patient’s later years. 

“I’m proud of what we’ve done with Garnet Health Doctors… and more to come,” he said.