(Editor’s note: Leslie Carroll addressed this letter to four key members of the organization Save Jennie Stuart — Theresa Nichol, Darrell Gustafson, Dan Kemp and Craig Richardson — regarding their assertions about Jennie Stuart’s financial situation as reported by news media outlets. Along with this letter, Jennie Stuart Health provided a Fact Sheet that includes what is described as “key commitments” from Deaconess.)
As we’ve shared previously, Jennie Stuart operates in a challenging financial environment and these financial pressures have only accelerated in recent years. Jennie Stuart has generated negative operating margins in eight of the last thirteen fiscal years and a more sustainable run rate for our organization could require a reduction in services or other difficult decisions in the future if we were to remain independent.
It’s important to note that non-profit health systems have different capital and debt requirements than typical corporations. Like most of the healthcare industry, Jennie Stuart generates very limited operating profit and is therefore reliant upon investment returns from its cash to service debt and meet debt covenant requirements. This limits our ability to fund additional expenditures with cash or debt and therefore we’ve explored alternative strategic paths that would ensure a strong financial future and the long-term success of our health system.