Citing Economic Challenges, SPHS Lays Off 135

SPRINGFIELD — Citing severe economic challenges in the first several months of 2010, the Sisters of Providence Health System (SPHS) has eliminated 135 full-time-equivalent positions across the system.

“Like most health systems and hospitals in the region, state, and nation, SPHS is experiencing a decline in patient volume and continuing challenges with reimbursement levels that, for some services, do not adequately cover the cost of providing care,” according to an SPHS statement.

“Factors such as increased health insurance deductibles and co-pays, coupled with general concern regarding the economy, appear to be causing a delay of non-urgent medical care and health services that is influencing this downward trend in volume,” the statement continues. “Without proactive changes in operations, SPHS would incur a projected budget shortfall of $14 million for 2010. Specific to Mercy Medical Center, year-to-date volume reflects that discharges are 8{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} below budget, and outpatient volume is 7{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} below budget.”

The most significant impact of the layoffs will be on inpatient support staffing responsibilities at Mercy, due to the elimination of 63 patient care technician positions. This change will allow the retention of bedside, licensed nursing staff and allow nurse-patient ratios to remain at current, planned levels, “but will not impact care quality or patient safety,” the health system asserts.

In addition to the elimination of positions at Mercy and across SPHS, including administrative positions, several other cost-saving measures are being taken to help improve the health system’s financial performance. For example, the overall salary increase program for 2010 is being suspended, and the internal employee referral bonus program is being discontinued.

Other initiatives to help improve the system’s fiscal outlook include the renegotiation of service and vendor contracts at lower rates, the sublease of unused space in off-campus locations, and revenue-enhancement opportunities such as an increase in grant funding.

“We deeply regret that the reduction of jobs is necessary,” said Dr. William Bithoney, interim president and CEO of SPHS. “The decision to make these changes has been difficult and the subject of a lengthy discernment process.

“Several potential alternatives were evaluated,” he continued. “However, we believe the course of action selected is the best for patients, residents, and clients, and for continuity of the SPHS mission. These changes reflect good stewardship and prudent management that will focus resources on the most important aspects of high-quality patient care. Providing high-quality care remains our focus and primary concern. Our clinical and nursing standards remain unchanged, and we continue to provide those we serve with the highest-quality care.”