Hospital warns of staff, service cuts

Facing an uncertain financial future due to a $292,000 budget shortfall, Whidbey General Hospital officials are preparing staff and the public for the possibility of lay-offs and cutbacks in service.

Hospital administrators called for "voluntary staff reductions" last week, though it won't be until late December until they know what impact the move will have on finances. Employees will be sent severance plan packages Nov. 1 and will have 45 days to consider early retirement.

However, in discussing potential cost reductions at a board meeting on Oct. 21, hospital Chief Executive Officer Scott Rhine warned that completing the hospital's 2003 budget may involve more drastic measures, such as layoffs, non-labor-related cuts, as well as looking at whether the hospital can continue providing some services.

Rhine said the last week has been a tough one for hospital staff, with many employees feeling frustration and disappointment about the dour financial forecast. However, he said, recent employee forums concerning layoffs cleared up some doubt and fear.

"I would characterize the forums as informative," Rhine said.

Hospital board policy is to keep a regular budget "threshold amount" of $3 million, but current revenue projections fall $292,000 short of that goal. Rhine said federal Medicare and Medicaid reimbursements, which do not fully cover costs of treating patients, are primarily to blame for the shortfall.

As it stands, the last day of work for employees opting for voluntary retirement would be Dec. 28, which gets layoffs under the wire for fiscal year 2002. Considering the time crunch and the uncertainty over how many employees will choose voluntary retirement, hospital financial officer Doug Bishop said it will be difficult to complete next year's budget.

"The budget process will be a long one this time," Bishop said. "We want to make the budget eventually balance, which will be a chore."

Rhine said the board must present the 2003 budget to the hospital's board of directors no later than January. He said it is important the board consider various cost-cutting measures all of a piece rather than separately.

"We've got to do it concurrently," Rhine said. "I think it would be wrong to do it a piece at a time. We should do that in a package, for the high level view."

By considering reducing expenses, services and/or labor all at once, Rhine said board members can stay abreast of the budget situation as it develops and assess how certain decisions impact the entire situation.

"We can present those as we go along, with the understanding that's a piece of the plan," he said.

Board president Peter Borden said at the board's Oct. 21 meeting that it will be important at some point in the budget process for administrators to prioritize various hospital programs.

Administrators voted to add an extra board meeting in late December in order to prevent a four-week gap in talks.

"We need information as it goes," said hospital district commissioner Barbara Saugen. "It should all be shaking down in the next couple of months."

The board will meet both Dec. 9 and Dec. 30.

We encourage an open exchange of ideas on this story's topic, but we ask you to follow our guidelines for respecting community standards. Personal attacks, inappropriate language, and off-topic comments may be removed, and comment privileges revoked, per our Terms of Use. Please see our FAQ if you have questions or concerns about using Facebook to comment.
blog comments powered by Disqus

Read the Oct 22
Green Edition

Browse the print edition page by page, including stories and ads.

Browse the archives.

Friends to Follow

View All Updates