Juan F. Louis Hospital details $686.6M FY2026 budget, cybersecurity recovery and reconstruction timeline

Juan F. Louis Hospital (JFL) presented to the Legislature’s Committee on Budget, Appropriation, and Finance on Aug. 15, 2025, asking lawmakers to sustain operating support as it completes recovery from a recent cyberattack and advances a multi-year demolition-and-rebuild program.

JFL Chief Executive Officer Darlene Baptiste told senators the hospital’s draft FY2026 operating budget totals $686,600,000, a roughly $85.2 million increase over FY2025, and said the governor’s recommended general‑fund appropriation of $30,250,000 remains a vital portion of the facility’s revenue mix (about one‑third of total public support). Baptiste said hospital leaders have also requested ongoing capital and mitigation support tied to reconstruction and to repair and sustain interim facilities.

The cyber incident in April 2025 remains a major operational and financial challenge, hospital officials said. IT director Roger Moore described a ransomware event that encrypted 166 virtual servers and triggered an incident command response across internal teams and partners including the Office of the Governor, Bureau of Information Technology, the territorial emergency management agency and external hospitals. JFL estimated an early revenue loss of about $675,791 in the first 10 days, and reported roughly $428,935 of manpower costs to run incident‑command through July (excluding overtime). CEO Baptiste told senators a “phased Operation Reboot” aims for full system restoration by September 2025, while temporary manual billing efforts have produced partial claim submissions and limited collections.

Finance staff provided senators details about revenue trends and cash flow: net patient revenue for Oct 2024–Mar 2025 was roughly $34.9 million, with actual cash collections of $16.0 million over that period (staff later clarified $16,000,938.56 for Oct–Mar 2025 vs. approximately $19M during the same period in FY2024). The hospital said self‑pay collections and Medicare/Medicaid billing continue to lag while a backlog of coded and manual claims waits for system recovery. Accounts payable remains elevated; management listed roughly $21.2 million in outstanding vendor payables as of July 31, some of which predate 2010 and involve active litigation.

Staffing, locum tenens and union contracts: Baptiste and Acting CMO Regina Flippin told the committee that workforce recruitment and retention remain the hospital’s top priorities. JFL currently lists 473 full‑time and 28 part‑time employees, including 256 clinical full‑time FTEs; hospital leaders said they have lost several physicians and face pending resignations that strain specialty coverage. Locum tenens costs were reported at roughly $2.7 million year‑to‑date, with monthly locum costs on the order of $200k to $250k in periods of high need. Hospital management said collective bargaining activity is ongoing across multiple unions, and that the newly passed territory minimum‑wage law could raise labor costs for dozens of employees beyond what’s included in the FY2026 projection.

Capital projects and reconstruction timeline: Daryl Smalls, executive director of the Territorial Hospital Redevelopment Team (THRT), provided a program update on the enabling projects that must be completed before full demolition and reconstruction of the existing JFL campus. THRT described work underway and projected delivery windows for: - JFL North (temporary clinical facility): operations relocated in April 2023; ongoing remediation and maintenance required to keep the interim facility safe. - Critical Administration building and Cassava Gardens administrative/workspace (off‑site consolidation): Cassava Gardens build‑out is planned to be move‑in ready by November 2025. - 5‑acre support site (parking, 10,000 sq ft materials/warehouse): site work and foundations in progress; contracted completion targeted by December 2025. - Interim dialysis facility (to relocate outpatient dialysis from trailers in the demolition zone): FEMA recently approved funding and THRT expects a notice to proceed no later than September 2025 for a ~280‑day contract; the dialysis trailers currently occupy demolition areas and must be relocated prior to full demolition. - Interim radiology and IV compounding suite: scopes in design and solicitation; IV compounding was deemed ineligible for some THS funds and needs an identified funding source.

Smalls said the reconstruction approach uses a construction manager at‑risk (CMAR) procurement model; bids for the bundled solicitation were received and are under review. He described the typical hospital rebuild schedule of 4–5 years but said THRT is exploring modular and other industry approaches to shorten timelines. He also listed market risks—long lead times for steel and equipment, global supply disruptions and workforce shortages—that require proactive procurement and standardization decisions.

Budget drivers and austerity measures: hospital finance highlighted key budget drivers: personnel services (about $348M, ~40% of operating budget), fringe/benefits (~$25.5M), supplies ($10.7M, a 20% increase attributed to medical inflation), utilities (~$4.9M) and other services and contracts (~$11.4M). Baptiste described a package of cost‑savings and austerity measures that produced roughly $6.6M in salary/benefit reductions through hiring freezes, position consolidations and reduced locum usage; supply‑chain initiatives and cooperative purchasing with the sister hospital Schneider Regional were projected to reduce supply costs by an additional $5.2M.

Uncompensated care and interagency receivables: JFL reported uncompensated care of about $38.7M for FY2025 to date, and called out an estimated increase driven by uninsured, underinsured patients and long “boarder” cases (patients clinically ready for discharge who remain in beds). JFL said it continues to work with the Department of Human Services and other agencies to place border patients and reduce bed days tied to nonmedical reasons.

What’s next: Senators pressed hospital leadership on collections, outstanding vendor payments, GVI appropriations and the pace of capital enabling projects. Management said they are pursuing revenue‑cycle improvements (contracted with a revenue‑cycle firm), expanding lab draw stations and telehealth, and working with the newly formed St. Croix Community Hospital Foundation to pursue philanthropy and grants. THRT said the demolition and reconstruction program is contingent on completing the enabling projects, and that selection of a CMAR contractor would allow mobilization and plan reviews to commence.

Ending: Hospital leaders urged continued partnership with the Legislature and the governor to sustain operations and support capital completion. They described the FY2026 ask as necessary to keep clinical services operating while THRT and JFL execute the multi‑year rebuild and recovery work.