With increasing demand for care, plans for a new medical campus in Post Falls, and continued investments into new programs, facilities, and staff, Kootenai County’s largest employer is getting even bigger.

“Kootenai Health has been growing along with the community for a long time,” says Jameson Smith, who took over as CEO of Kootenai Health in March 2024, following the retirement of Jon Ness.

Healthy population growth, as well as an aging population, have increased demand for health care in the North Idaho area over the years, Smith says.

As it has grown to meet the rising demand, Kootenai Health has become a tertiary referral center, meaning it has specialized programs and services that other health care providers in the region may not have, Smith explains.

“We are taking transfers and keeping people that we might not have 15, 20 years ago,” he says. “All of that growth has led to some good financial success, which then we’re reinvesting.”

Similar to other health care providers, including Providence and MultiCare Health System, Kootenai Health has dealt with financial challenges that stemmed from the pandemic, particularly in 2022.

Kootenai Health, however, was able to climb out of that hole quicker than some other health care systems.

“They reacted very quickly, put a plan together, executed the plan, drove out contract labor, cut expenses, continued to grow, and we only were in that hole for about 12 to 18 months,” Smith says of Kootenai Health’s leadership team at the time.

In this year's first quarter, Kootenai Health reported operating income of $14.9 million, with an operating margin of 5.2%. That’s up from a year earlier, when Kootenai Health posted Q1 operating income of $5.3 million, with an operating margin of 2.2%. A company's operating margin is the profit it makes on each dollar of sales after deducting variable costs involved but before accounting for interest and taxes.

Smith says that while the operating margin isn’t "anything outlandish," it’s enough for Kootenai Health to be sustainable, pay its employees fairly, and invest in new programs, equipment, and facilities.

“It’s a very capital-intensive business,” he says. “You have to have a predictable and sustainable margin. I think we’re very much on that track again.”

Post Falls plans

One major investment Kootenai Health is making, in partnership with MultiCare, is a planned 30-acre medical campus in Post Falls, at the southeast corner of Highway 41 and Prairie Avenue.

Kootenai Health will be the managing partner of the joint venture and will operate the Prairie Medical Campus, as it will be called.

Smith says an architect and contractor will be selected soon, and he estimates an opening date of early 2028.

As reported by the Journal, the first phase of the project will include construction of a micro-hospital with a 12-room emergency department, imaging services, and patient rooms for overnight stays. An advanced imaging center will be located in the hospital.

The initial phase also will include the development of a multistory medical office building that will be home to a new ambulatory surgery center, clinic offices, lab services, and more.

“A lot of health care services are moving outside the hospital,” Smith says. “It’s really more about the ambulatory and the outpatient arena, and that’s where people access physician visits, infusions, imaging, same-day surgery. We’re really trying to invest more in that arena.”

The new campus will likely increase Kootenai Health’s employee count by a couple hundred people, if not more, Smith says.

“I can certainly see us cresting 5,000 employees in the next two or three years,” he says.

Kootenai Health currently has over 4,500 employees.

Kootenai Health has also upgraded its imaging capabilities, Smith says. For example, the organization announced in May the opening of two new women’s imaging centers—one in Coeur d’Alene and one in Post Falls.

The health care organization has experienced growth in almost all its areas, Smith says.

“What we’re really focused on at Kootenai Health is providing advanced medicine right here; providing sophisticated, comprehensive programs that keep people in North Idaho and also draw people from without North Idaho,” Smith says.

Currently, about 30% of Kootenai Health’s patients come from outside Kootenai County, he says.

The health system’s cardiovascular and neurosurgery departments have both seen increased volume, but Kootenai Health’s trauma department has likely witnessed the most growth recently.

In early 2024, Kootenai Health became verified as a level-two trauma center by the American College of Surgeons Committee on Trauma. That verification has led to more transfers from the 10 counties that make up northern Idaho.

“We also get people from Eastern Washington and western Montana,” Smith adds.

Another area that has seen significant growth is women’s and children’s care, especially labor and delivery.

Kootenai Health handled 235 baby deliveries in May—a new record for the organization.

“We’re on track to have a record year in deliveries,” Smith says. 

Amid its continued growth and successes, Kootenai Health is not without challenges.

The single biggest problem facing the health care provider is poor payer behavior, Smith says, echoing the frustrations of other health care leaders in the area, including Justin Voelker, Providence's CFO for its Inland Northwest region.

“The insurance companies denying claims, paying us less than we expect to be paid, trying to delay payment,” Smith says. “It is absolutely a major issue for all providers.”

Like many organizations in the industry, Kootenai Health also faced labor challenges in recent years because of the pandemic.

“We all felt the pinch with contract labor when there was kind of an arms race for talent, and it got really out of control, frankly,” Smith says. “You can’t blame the employees who went off to do travel assignments and left, because the money was so compelling.”

He says Kootenai Health’s workforce has since stabilized, however, as the organization focused on making its compensation and benefits more competitive.

Kootenai Health has also focused on improving workplace culture and ensuring employees have ample career growth opportunities, Smith adds.

“Our workforce challenges are much less than most of the rest of the market,” he contends.

Smith says Kootenai Health will continue to look for ways to improve and grow. He describes the organization as small but mighty, autonomous, independent, and nimble.

“We can really make things happen in maybe a more rapid way than a larger system would take,” he says.