This past February, Suzanne Ward’s doctor removed a growth from her eardrum and sent it off to the lab for analysis. (That’s not her real name; we’re using a pseudonym to protect her privacy.) 

Ward was anxiously awaiting results when, on March 4, she received a letter from Traci Ober, area risk manager for Providence St. Joseph and Providence Redwood Memorial Hospital. A courier driving patient pathology samples through severe winter weather had been in an accident eight days earlier, the letter said. The injured driver had been taken to the nearest hospital. Their vehicle wound up in a ravine, along with all the patient samples they’d been hauling.

“We believe your pathology specimen may be located in the courier vehicle at the bottom of the ravine,” the letter to Ward read. “If your specimen was preserved in formalin and the container is intact, it is possible, once the vehicle is rescued, the Hospital can perform the ordered testing.”

That never happened.

Ward didn’t hear anything more from Providence for nearly three weeks. When finally she did, via another letter from Ober on March 27, the news wasn’t good. A third-party retrieval company had gone to the site of the crash, accompanied by a member of the hospital’s “Laboratory Leadership Team,” and together they “spent the day attempting to locate the pathology specimens from the vehicle” without success.

To this day, neither Ward nor her doctor know what type of growth he removed from her eardrum, and because he excised the entire thing, there’s nothing left to be biopsied and analyzed.

“All I have are pictures of what he removed,” she told the Outpost in a recent phone conversation. She said her doctor was beside himself when he learned, after the fact, that her biopsied tissue had been sent south, along with other patient samples, to a lab in Santa Rosa, where they would have been processed and placed onto microscope slides before being sent back to Eureka for diagnosis. 

With Hwy. 101 closed due to winter weather conditions on Feb. 24, the day of the crash, the courier, who was contracted through a national medical logistics company called MedSpeed, had taken the narrow and remote State Route 36.

Chuck Petty, the former pathology manager at Providence’s Eureka lab, said numerous other patients must have been seriously impacted by this incident.

“I can’t imagine that there were just pathology specimens in this load, because they were taking blood specimens and culture specimens every day in the same courier runs,” he said in a recent phone interview. 

Those types of specimens can be collected again fairly easily — by redrawing a patient’s blood or re-swabbing a wound. But other types of samples require invasive procedures, “like a lung biopsy or something deep in the body,” making it “a major deal for the patient to go through to be re-biopsied,” Petty said. And in cases like Ward’s, where there’s nothing left to re-biopsy, the only thing to do is watch and wait, which can be risky.

“Consider this: It could be a malignant melanoma, which could go into the bloodstream and then go throughout the body,” he said. “So if they missed a malignant melanoma, it could be disastrous for the patient to just watch and wait.” 

Ward still doesn’t understand how this could have happened. 

“None of it jives,” she said. “How can [my sample] be lost? How does this happen?” 

Until recently, all of the hospital’s pathology lab work, including microbiology and histology, was performed locally, at a laboratory located across the street on Harrison Avenue. But over the past two years, under the leadership of executives at Providence’s headquarters in Renton, Wash., laboratory services for St. Joseph and Redwood Memorial hospitals have systematically gotten outsourced to Providence-managed facilities in Napa and Sonoma counties. 

Former St. Joseph Hospital employees interviewed by the Outpost say the February car accident that caused so many patient samples to be lost was a predictable risk under these new procedures, and they say this centralizing of services with distant health care facilities has led to increased turnaround times and lower quality lab work, which can have major implications for patient outcomes.


Providence, which merged with St. Joseph Health System in the summer of 2016, has grown into one of the largest not-for-profit health care systems in the country. It now operates 51 hospitals and more than 800 clinics across the western U.S. In each of the last two years Providence’s operating revenues exceeded $27 billion, and according to the New York Times, the organization runs its own venture capital fund with $10 billion in investments while avoiding more than $1 billion a year in taxes through its nonprofit status.

Rod Hochman, the president and CEO of Providence Health & Services, told an industry publication in 2021 that “‘nonprofit health care’ is a misnomer.”

“It’s tax-exempt healthcare. It still makes profits,” he said, adding that he considers shareholders his community.

Unfortunately for that community, the organization’s financial outlook has taken a bad turn recently. Providence posted a net loss of $6.1 billion last year, making for an operating margin of negative 8.8 percent. Last month the organization’s credit rating was downgraded for the third time in three weeks.

Providence is not an outlier in its management style. In recent years, the health care industry has undergone unprecedented consolidation, both in California and across the country. The California Health Care Foundation (CHCF) says this trend harms consumers by creating higher health insurance premiums and out-of-pocket costs. And it’s worse in places like Humboldt County. 

“When rural hospitals are absorbed by large health systems, neither their financial stability nor performance are improved,” CHCF market analyst Kristof Stremikis observed in 2020. 

In emailed replies to questions from the Outpost, Darian Harris, chief executive of Providence in Humboldt County, said the February car crash was the first time lab specimens have been lost in such a way, and he added that Providence “exhausted all feasible opportunities to retrieve these lab specimens on behalf of our patients.” 

“This included, but was not limited to, securing a specialized third-party retrieval company to support in our efforts. … [and the use of] specialized equipment to support an extended search,” Harris said.

“We are deeply sorry for any interruption of care the courier’s car accident may have caused our patients and their families,” he continued. “We immediately contacted patients informing them and provided guidance on engaging their providers to next steps for their care.” (This despite the fact that it was eight days after the incident before Ward received notice and nearly three more weeks before she was informed that the samples remained missing.)

Harris did not say how many patients’ samples were lost and, citing patient privacy, he said, “[W]e can’t share the specifics of the tailored way providers advised patients of the most appropriate next steps for their continued care.” 

As for the decision to consolidate lab work to facilities located several hours away, Harris described it as a centralization within the “broader Providence family of organizations,” a move that “allows us to keep access local by partnering with our sister facilities in Northern California in lieu of patients having to leave our community for this service.” 

In other words, if the lab work didn’t get sent four hours south, patients would likely have to make that drive themselves. But why is that the case when lab work was performed locally for decades?

According to Harris, the decision was made “in response to the chronic workforce shortage of caregivers with the specialized expertise in this lab modality, specifically in rural and remote areas across the country like Humboldt.”

Petty says that’s simply not true. “The pathology department was completely staffed until January of 2022 when I retired,” he said.  And the reason he retired when he did, he said, is because it had become clear to him that Providence wanted to close St. Joe’s pathology unit. “I told my manager several times, ‘I will not stick around to watch you dismantle my department,’” he recalled

‘I will not stick around to watch you dismantle my department.’
-former pathology manager Chuck Petty

Petty, who began working at St. Joseph Hospital in 1981, said consolidation is a fundamental component of Providence’s corporate-style management, and the writing was on the wall from the beginning.

“When Providence bought St. Joseph in the summer of 2016, all the managers went to an online seminar, and [Providence executives] stated at the time that their model was to centralize all services that could be centralized — so, laboratory and other things like that, that don’t have to be done onsite,” Petty said. “So we knew at some point that was going to happen.”

The Outpost also spoke with a former employee of Coastal Pathology Medical Associates, which long operated out of the Humboldt Central Laboratory on Harrison Avenue, across the street from St. Joseph Hospital. That’s where pathology specimens were sent for nearly 40 years — until last summer. The employee asked to remain anonymous to avoid professional repercussions, so we’ll refer to her as Jane Wilson.

She remembers that the Providence-St. Joseph merger was sold as a “strategic alignment,” but in her view it was “100 percent a takeover” by Providence, and things at the hospital have since changed for the worse.

“I was there when it was [run by] the Sisters of St. Joseph,” Wilson said. “It wasn’t perfect but I look back on those days now as being idyllic. The sisters — we still had nuns up here — they actually cared about the community and the employees and the physicians. … We always had nuns on the board. They weren’t here full time … but they absolutely were here every month for board meetings and you felt their presence. They’d say, ‘We can’t just dump homeless people. Can we come up with a solution to not dump them on the street?’” Wilson said the nuns functioned as organization’s conscience, “like Jiminy Cricket.”

Wilson said there weren’t any alarming changes immediately after Providence took over, but after a couple of years things started to shift. First it was small stuff, procedures related to IT and purchasing, for example. Then the signs were changed, adding “Providence” to the front of the hospital, and staff was told that the hospital would no longer have a CEO but rather a president.

The last time Providence negotiated a new contract with the pathology group, Wilson said, compensation got tied to turnaround time, which was a change. But initially she wasn’t overly worried.

“It was like, okay, we’ve always had 24- to 48-hour turnaround times, so, sure, we can do that. And I’m not kidding, like, a month later they [Providence] were like, ‘We’re going to be consolidating the laboratories.’” This meant that histology would no longer be performed by someone in the local lab; instead Wilson would have to wait for samples to be shipped to Santa Rosa, thinly sliced and placed on microscope slides before getting sent back to Eureka for diagnosis.

To her this made no sense. “I’m like, ‘How does that work? How do I meet turnaround time?’” she said. “There’s literally no way for me to maintain a 24- to 48-hour turnaround time if that [sample] is getting driven down to Santa Rosa once a day.’” 

‘Waiting 24 hours to get results is hard; waiting a whole week is not good. Waiting a week is kind of soul defying.’

She also sympathized with patients. “I’ve had a breast biopsy before,” Wilson said. “Waiting 24 hours to get the results is hard; waiting a whole week is not good. Waiting a week is kind of soul defying.” 

Harris, in his emailed statements, defended the new system. “Our turnaround times relative to these services are within industry standards,” he said. “All services we provide to our community have the patients’ best interest in mind and we are driven by providing the highest level of care to our patients.”

He added, “The care that is currently being offered by Providence in Humboldt is a product of creative partnerships and innovative thinking to advance care locally.”

Petty, on the other hand, argued that Providence’s consolidation model may work well in metropolitan areas like Seattle and the North Bay, places where Providence has several hospitals within a 50- to 100-mile radius. But it hasn’t worked out for Humboldt County, with its remote location and often unreliable roads.

“It just didn’t work the same as they expected based on their model of sending [specimens] to a centralized laboratory,” he said.

Like Wilson, he had a great relationship with the hospital’s previous owners, the Southern California-based Sisters of St. Joseph of Orange, which, like Providence, is a Catholic nonprofit health group. But Petty was concerned about the new management.

As with Wilson, Petty said nothing too alarming happened during the first few years after Providence took over, “but in the last two years they really started moving things. So, in June of 2021, the first part of the laboratory to move was microbiology. They moved it to Napa, Queen of the Valley Hospital.”

An outside courier service was hired to make two runs per day between Eureka and Napa, and according to Petty, the three Eureka-based clinical laboratory microbiologists, who until then had been under contract with Providence, were given a choice between moving into “a regular clinical laboratory scientist job in the hospital” or being laid off. It wasn’t much of a choice.

“They had been working strictly as microbiologists for so many years they felt uncomfortable going back into the general labs,” Petty said. One of the three chose to retire and the other two got laid off, all but obliterating the hospital’s microbiology unit. (A single employee remained, tasked with setting up cultures and streaking them onto plates, according to Petty.)

Next to go were the histology technicians, the lab workers tasked with preparing thin slices of tissue to be analyzed by pathologists.

Julia Minton is a labor organizer and member representative with the National Union of Healthcare Workers, which represents employees at St. Joseph Hospital in Eureka and Redwood Memorial Hospital in Fortuna as well as workers at Queen of the Valley Medical Center in Napa and Petaluma Valley Hospital in Sonoma County.

‘This is a pattern of consolidation. … It’s happening across the whole industry but especially with Providence. It’s part of their business plan.’

“The sense from the histology techs [in Eureka] since early in the pandemic was, ‘They’re winding this department down,’” Minton said, though she added that the employees were never told that directly. “The concern there was that this is a pattern of consolidation of services. It’s happening across the whole industry but especially with Providence. It’s part of their business plan.”

Early in the pandemic, the histology techs saw the writing on the wall, according to Minton. “They felt like their employer didn’t want to fill [vacant] positions. I’ve seen this time and time again, where Providence says, ‘It’s the labor market.’ And there are genuine issues across the industry, but they’re also not doing due diligence to fill these positions.”

Petty said that after he retired last January, both of his remaining histology techs went out on stress leave. “That’s when the short-staffing started,” he said.

One of those former histology techs, who we’ll call Iris, told the Outpost that hospital management repeatedly denied that they had any intention of closing the lab, right up to the day when the remaining techs were notified that they were being laid off.

“They kept claiming they had no intention to shut down the lab, but all of the decisions being made pointed in that direction,” said Iris, who worked at the hospital for seven years. “They wouldn’t replace equipment; they wouldn’t replace staff; they wouldn’t invest in the department. … Long before we ever went on medical leave they were clearly divesting in the department.” 

Petty said this trend is what convinced him to give his boss an ultimatum, saying he refused to stand by while his department was dismantled. Asked why he felt it was so important to take that stand, Petty replied, “Well, because I saw the quality declining.”

He’s been to the labs in Napa and Sonoma counties. Napa’s is state-of-the-art, he said, and Sonoma County’s is decent, “but it’s very small, and their ability to absorb our workload and still maintain good turnaround time seemed questionable.”

According to Petty, Providence didn’t provide any new staff members at the Santa Rosa lab when Humboldt County began sending its pathology samples down there. Once the work shifted to that lab, Petty said, “turnaround time went from 24 to 48 hours to five to seven days. And the quality went down.”

How does lower-quality lab work impact patients?

“Well,” Petty said, “potentially it could have an effect on the pathologist’s ability to diagnose a cancer because the quality of the specimen preparation was not good. The stains were not as clear as they used to be because they were putting a lot more tissue through without changing the stains as frequently, so they would get depleted after time. It was just not good pathology. [But] it was good economically for the parent organization because they were saving money on the staff.”

Wilson said she finds the whole situation sad. She ran down a list of St. Joe specialists lost to attrition over the nearly 20 years since she moved to Humboldt County. “We had three nephrologists; they have none now. We had two rheumatologists; now, none. I think we had three or four more general surgeons. They’re down to one neurologist. They had four or five OB/GYNs; now they basically have [Dr. Deepak] Stokes.” 

The number of pathologists and oncologists has also declined, and many of the hospital’s specialist positions are now filled with locums, a situation Wilson characterized as “this revolving door of semi-incompetents,” adding that these temporary workers rarely stay in the area for longer than six months.

“I don’t think they care that we’re losing specialists,” Wilson said of Providence. “I think it’s revenue optimization. … I think they want us to be a feeder hospital to Santa Rosa. I don’t think they want specialty care up here at all. … They can just basically let us go to the dark ages.”

Bob Just, chief executive of Providence Medical Group Northern California, strenuously denied these charges. He noted that Humboldt Medical Specialists, founded in 2009, is now part of Providence.

“Through our combined efforts over the past 14 years, we have either recruited or retained over 150 physicians and advanced practice clinicians in the community,” he said in an emailed statement. “Without PMGNC support, there would be very few physicians left in the community and the hospital would be struggling to keep its doors open. The reality is that we have and continue to improve access to care and coverage of the hospital in recent years despite the nationwide physician shortage.”

Harris concurred. Asked if there are any plans to further consolidate services offered at St. Joseph Hospital he replied:

Health care is rapidly changing. Any service decisions we make as an organization will always have our Mission and patients’ best interests in mind. However, we are not immune from the economic and global workforce challenges that are impacting health care across the country, especially in remote and rural locations like Humboldt County. 

As an organization we are constantly evolving so that we can adapt to the needs of our community, now and in the future. At present, Providence has no plans to limit services. In fact, we have been successful in adding physicians and other providers in service lines like orthopedics, cancer, and neurology.  

Additionally, the St. Joseph Hospital Family Medicine Residency Program is graduating another cohort of Family Medicine physicians this June, adding to the provider base here on the North Coast.  

Our goal is to continue to remain a vibrant and forward-thinking health care organization that provides our community with best-in-class care that is in alignment with the community’s needs and our ability to furnish that care.

But from Petty’s perspective, things are moving in the wrong direction.

“A lot of good people have been leaving,” he said. Rattling off a few, he said the head of chemo-oncology left, as did “a bunch of managers.” The head of the emergency department stepped down into a nursing role. The head of surgery has changed several times.

Petty observed that it has been a difficult time to work in health care in Humboldt County. The COVID-19 pandemic took a huge toll on frontline workers, who were forced to manage isolation wards along with patients, friends and family who could be hostile.  Health care workers were also impacted by the Public Safety Power Shutdowns initiated by PG&E in recent years. Hospital workers went on strike in 2019 to protest chronic understaffing.

“It’s just a very traumatic time,” Petty said. 

Wilson said there’s a silver lining to the problems at St. Joseph and Redwood Memorial: a “burgeoning” of improved services at Mad River Hospital in Arcata and Sutter Coast Hospital in Crescent City. “They are growing and doing well because people don’t want to deal with the bullshit of turnaround times,” she said.

Petty believes that things didn’t need to happen this way, that Providence executives could have chosen a different path but instead sacrificed the quality of care for local patients in an effort to maximize profits. 

“It’s just my opinion that this was planned all along,” he said.