Palomar delays nurse incentive payments citing ongoing financial difficulties

Some nurses at Palomar Health in North County are expressing their dissatisfaction with a recent executive decision to delay incentive payments that were due on July 4 due to ongoing financial difficulties at the public health care district with hospitals in Escondido and Poway.

The matter became public at the district’s monthly directors meeting, where union representative Susan Adams, a Palomar labor and delivery nurse, told board members that many who were counting on the latest installments promised to those who signed up for three-year retention incentives are not happy.

“We feel that you dangled a carrot in front of us, had us do the hard work, then took the carrot away after the job was completed,” Adams said.

Palomar Health confirmed in an email that the comments referred to the medical provider’s 2023 incentive program, which offered up to $100,000 to nurses who committed to staying through 2026, receiving incremental payments in installments each year.

“Palomar Health remains fully committed to paying the total amount originally promised,” Palomar’s statement said. “The updated timeline allows for more strategic distribution, and the organization may explore accelerating the program if and when financial conditions allow.”

Diane Hansen, Palomar’s chief executive officer, acknowledged the situation in her comments during the meeting on July 14.

“No one was more dismayed at, you know, our really just inability to pay that in one lump sum in July, and so we did not reduce the amount that’s being paid out,” Hansen said. “We simply stretched that July payment out, I believe, until October.”

The executive further said that she appreciated Adams’ comments and understands the frustration expressed.

“I understand that, and I get it,” Hansen said. “It doesn’t mean that we value them any less or the work that they do.

“They are the lifeblood of this organization, along with our physicians, and we’re here to support them in the work that they do.”

The longer-term plan, Palomar confirmed, is to add an additional two years onto the end of the three-year program, pushing its total run from three to five years, a move that the organization said is designed “to support long-term sustainability and continued investment in its nursing workforce.”

Adams said at Palomar’s public meeting that experienced nurses are leaving over the incentive payment delay and extension of the program. However, neither Palomar nor the union provided solid figures on how many have departed.

“Have we lost nurses because of this?” Hansen said during her July 14 comments. “Yes, I believe we have.

“I mean, whether or not they were going to leave anyway is a question, but the reality is, we were just not in a position, from a cash standpoint, to pay it out all in one lump sum.”

Though Palomar’s most recent financial report does indicate that an ongoing turnaround plan is making headway, consolidated balance sheets still show the district operating at a loss. Like many medical providers across the nation, Palomar has struggled to meet the increased costs of supplies and labor, even as it faces more intense competition for patients in inland North County with the recent opening of Kaiser Permanente’s new San Marcos hospital.

A potential source of new strength appeared last week with the announcement of an exclusive negotiating agreement with UC San Diego Health. The two public institutions are considering a joint powers authority that would operate Palomar and provide neutral ground for deep collaboration.

Rapid response nurse John McDonald, a member of the California Nurses Association with 39 years of experience, primarily in critical care, said that the payment due in July was about $15,000 for full-time nurses.

Indicating that an experienced nurse on his team recently left for “greener pastures,” McDonald said that many are concerned that there could be an erosion in personnel with deep experience.

Hiring, he said, continues, but seems to be bringing in those who are just starting their nursing careers.

“It seems to me that they’re kind of devaluing the benefit of having experienced people on staff in favor of having the cheapest possible nurses that they can get,” McDonald said. “As a rapid response nurse, I am called all of the time into situations where I identify that something has been missed or isn’t being handled appropriately, simply because the nurse doesn’t really know what to do.

“I think that can only get worse if those people who are experienced decide to offer their experience elsewhere.”

Palomar’s website lists 47 open registered nursing positions, offering bonuses of $20,000 to $45,000 based on job type and years of experience. Many listed positions state that one year of experience is required, but two years are preferred.