Hospital makes staff cuts

Published 4:04 pm Tuesday, January 18, 2011

Billy Walker, interim Co-CEO and chief financial officer of Memorial Hospital and Manor, announced Tuesday that a restructuring of staff is underway to reduce overall expenses by 10 percent to overcome this year’s operating deficit of more than $2 million.

Department managers were asked to analyze both salary-related and non-salary related expenses to reach this goal.

In the last week, 12 full-time employees have been terminated as a result of this restructuring. Some departments have opted for scheduling employees to work less than 40 hours each week, while also eliminating overtime. Also, employee work schedules may be adjusted on a daily basis according to the patient census each day.

Memorial Hospital and Manor is not alone in its effort to cut expenses through lay-offs or permanent reduction in staffing. After the 2008 economic downturn, many hospitals throughout Georgia and the nation faced a reduction in revenue and an increase in expenses due to high unemployment rates, reimbursement cuts in Medicare, and looming cuts in Medicaid. As a result, hospitals have been forced to reduce expenses, the news release said.

In addition, a new hospital bed tax passed by the Georgia General Assembly last year was intended to increase Medicaid funding to hospitals. Hospitals have already begun paying the bed tax; however, increased Medicaid funding to overcome the amount of tax paid has yet to reach hospitals.

With Decatur County’s unemployment rate remaining high, more patients are entering the hospital without insurance coverage. Last fiscal year, Memorial Hospital and Manor’s uncompensated care exceeded $6.7 million, Walker said.

The economy has also hurt insured patients’ ability to pay for services. Some patients have high deductibles and must pay out-of-pocket for medical services. As a result, many people cannot pay their hospital bills for services.

Memorial Hospital and Manor has seen an increase in the patient liability portion of accounts receivable due after insurance has paid. In addition, patients have postponed elective procedures such as diagnostic tests and surgeries due to financial difficulties, which have caused a decline in the hospital’s revenue.

“It is very unfortunate that we are at the point where Memorial Hospital and Manor employees must be terminated; however, it’s necessary to make cuts in order for the hospital to operate,” said Walker. “We have to do everything we can to eliminate our operating deficit so that we can make it through this economic downturn.”