How the lack of affordable housing is a crisis for North Bay health care
In a market where the average home price is north of $800,000 and rent at nearly $4,000 a month for a two-bedroom apartment, that people leave jobs or don’t accept offers may not be news to North Bay employers.
But when housing is an issue in the health care industry, it brings the crisis to another level.
“It’s really made it difficult for us to recruit, and I'm not just talking about entry-level wage earners, it's across the spectrum,” said John Hennelly, president and CEO of Sonoma Valley Hospital. “We've lost physician recruits because of the current environment.”
The housing environment, of course, is exacerbated by inflationary pressures and, for some, it’s become too much, he said.
“I lost a (mid-level) leader in the last 90 days who decided that it just wasn't financially viable to stay in a market that they had lived in for 15 years,” Hennelly said. “They had been very transparent, and we sort of talked through options and whatnot, but it came to the point where it just wasn't viable.”
Lynn McKissock, Sonoma Valley Hospital’s chief human resources officer, said the city of Sonoma has traditionally been more expensive compared to other Sonoma County communities which, from time to time, has proven a deterrent for job candidates.
“However, over the past year in particular, I believe we are seeing an uptick in that regard,” McKissock said in an email statement. “We have not only experienced employees leaving to relocate to less expensive areas, we have also experienced candidates declining our job offers after conducting research on housing costs (and) availability.”
The prohibitive cost of living in Sonoma will remain a barrier in the hospital’s ability to recruit and retain workers unless more affordable housing options are developed, she added.
“Five years ago, the average home in Sonoma was under $700,000, and it's now well over $1 million,” Hennelly said, citing data from Redfin, a Seattle-based residential real estate brokerage. “Where is it going to go from there? Wages aren't following that trend. I’m not seeing a 30% to 50% increase in wages over the last five years, so the math is not adding up right now.”
As costs go up, especially for people who are renting, Hennelly said, not only does it become increasingly difficult to stay, it also is challenging for the hospital to try to help when its costs are also rising.
“So, it doesn't afford us the luxury of saying, ‘Well, let's just pay everybody a little bit more, or let’s pay transit subsidies to alleviate those stresses,’” he said.
Hennelly said he sees a couple of different pathways for long-term solutions. One is to pursue partnerships with a couple of foundations to promote affordable housing, something big institutions like Stanford Health and UCSF Health have done, he said. But that route would have to be measured so as not to harm the character of the community, “whether it’s Sonoma, Petaluma, Napa or somewhere else,” he said.
Hennelly said he’s also looking at ways to provide some transitional housing, perhaps a one-year rental that the hospital would host or partner with another entity to host.
Some roles are conducive to being carried out remotely, such as case management, billers and coders, among others, and Hennelly has made those accommodations to retain staff.
The hospital has several workers scattered throughout the state, one in Oregon and another on the other side of the country, in South Carolina, he said.
Retention is also somewhat easier to manage for the physicians who do join the hospital because doctors tend to stay in the community where they establish their patient base, Hennelly noted.
But it still doesn’t mean they’re able to live nearby, or within a reasonable commute, which Hennelly describes as about 20 minutes.
“When you’re getting up to that round trip of an hour a day, it starts to weigh,” he said. “And honestly, we have people that are commuting from close to Sacramento. That's a crazy commute. That's 80 miles. You're doing that twice a day? That’s not optimal.”
A big investment
It’s also not optimal when your health care system is situated in a geographic region not conducive to commuting.
For Napa-based OLE Health, it’s a double whammy because affordable housing in the county comes at a premium.
“If someone is not already based in Napa, we find it incredibly difficult to get people to relocate to the Napa area,” said Alicia Hardy, CEO of OLE Health. She noted that OLE pays “competitive salaries,” but that’s often not compelling enough to recruit health care workers when they have many options of places to live in an industry suffering a severe workforce shortage. OLE Health is a federally qualified health center (FQHC) that cares for a vulnerable segment of the community, including the uninsured, Medi-Cal families and seniors.