Free and Reduced-cost Care Soars Amid Pandemic; CareNet Regions Deploy Strategies to Meet Challenge

When Barbara Saulpaugh, director of CareNet’s Piedmont Triad region, last year learned of a grant program in Winston-Salem to aid low- and moderate-income residents economically hurtby the COVID-19 pandemic, she was all over it.

“I knew that we weren’t going to be able to hold our usual fundraisers, such as an annual golf tournament,” Saulpaugh says. “We had to be able to find other sources of income for our client assistance fund, especially with it becoming clear early in the pandemic that many people were going to lose their jobs and their insurance.”

The Piedmont Triad region eventually won a $50,000 grant from the city of Winston-Salem,money that went a long way toward meeting the needs of clients overwhelmed by anxiety,depression and grief as they navigated the pandemic.

As has become clear nearly two years later, the pandemic has fundamentally changed life for organizations such as CareNet. In the 2020-21 fiscal year, CareNet increased its free care services alone by 50%, from $800,000 annually to $1.2 million. The figures so far for the current fiscal year show the amount of free care to again be high.

CareNet President Bryan Hatcher says the pandemic has created a sort of havoc with the organization’s finances, largely because typical funding sources have themselves faces crises. For example, CareNet’s primary denominational supporter decreased its annual contribution significantly based on local church donations being down; it is likely that the donor will not return to the level of support it once provided.

“We’re at a moment in time where fulfilling our mission is as crucial as ever, but the resources to do so present a challenge,” Hatcher says.

CareNet’s regional directors and boards continue to develop unique strategies to meet the need for funds to aid clients requiring free or reduced-cost care.

In the Western region, the cost of free care was five times as high in 2020, at more than$105,000, than it was in 2019, when it was less than $20,000. The numbers in 2021, which are not yet fully compiled, show another 20% or more increase, says Kevin Parker, the region’s director.

One of the ways his region has managed is via grants. The Western region won a $20,000 grant from the Community Foundation of Western North Carolina to be used exclusively to defray the costs of treatment for patients who are uninsured or under-insured. “CareNet Counseling remains committed to our value of providing care regardless of ability to pay,” Parker says.

Terry Tackett, director of CareNet’s Coastal region, reports that since the onset of the pandemic, his region has averaged giving back $50,000 for 2020 and 2021.

“We are blessed to receive foundation grants of $45,000 each year to help cover those costs,” Tackett says. The remaining funds were drawn from the region’s operating account.

For the Piedmont Triad region, the combination of free care write-offs and client assistance rose 25% from the year before the pandemic.

“We have been able to keep up with it through a series of grants from the City of Winston-Salem, the Cardinal-Forsyth County Mental Health Committee, and through enhanced fundraising, such as an extra Giving Tuesday in May 2020,” Saulpaugh says. “The needs for financial assistance continues to be steady, and funds that were specially targeted for this purpose are dwindling. Helping our clients through assistance with their bills is the part of our mission that resonates the most with our counselors, board members, grateful clients who have completed counseling, and our staff.”

On a broader front, CareNet is moving as an organization to create new sources of revenue.

Hatcher says CareNet is in the process of hiring a development officer who would have two key goals: creating an annual campaign for the organization and working with the regional offices to help guide them in improving local fundraising. CareNet also has been working for several months with a consultant from Atrium Health who oversees outpatient clinical practice managers.

The development officer is part of ongoing efforts by CareNet to improve operational capacities, Hatcher says, which last year included hiring Rebecca Brummel as project manager for finance and Alex Taylor as project manager for billing.“

Our goals must be to adjust to changing times, and our merger with Atrium Health allows us to take advantage of resources and expertise to do so,” Hatcher says.

CareNet ran a substantial deficit in 2020-21 and will likely be in the red again in 2021-22, but Hatcher says the organization is moving in a new direction with the regions and central office making changes to be on better financial footing while maintaining—and, in fact, increasing—the number of clients seen.“

CareNet’s Board of Trustees and I developed guiding principles in light of the pandemic, and what the regions are doing perfectly fits the bill,” Hatcher says. “We need to be financially stable over the course of 2022 and we want to maintain our mission while minimizing the impact to our staff and boards.”