Providence eyes cuts
Health group offers severance pay to some staff
A $61 million budget shortfall has prompted Providence Health Care to seek voluntary layoffs by offering severance pay and cash bonuses.
Letters have been mailed to the organization’s 8,500 employees, most of whom work at Sacred Heart Medical Center and Holy Family Hospital.
Elaine Couture, chief executive officer of the two hospitals, said Providence intends to find adequate savings through the voluntary reductions along with attrition, and savings on supplies and other expenses.
She said administrators are not looking at a specific number of employees. The hospital, for example, will continue to hire for some jobs at the same time it is eliminating others.
Providence is treating fewer patients this year, Couture said, partly because people are less apt to undergo elective surgeries amid the lingering economic problems.
It’s a phenomenon affecting hospitals across the country.
The hospital system – it also includes facilities in Colville and Chewelah – has a $1.1 billion budget for 2012 and is attempting to absorb lower reimbursements from Medicaid and higher costs of treating the uninsured.
Employees who choose to accept the buyout will have their jobs terminated by Dec. 16. They have until Nov. 28 to turn in their paperwork.
Couture said the search for savings will coincide with Providence’s ongoing restructuring efforts that include building a broad network of clinics.
Administrators are trying to prepare for health care reforms and changing demographics by trying to help patients avoid expensive hospitalization. They’re also getting ready for what is expected to be another round of deep cuts in state spending on health care for the poor.
“We need to plan now,” Couture said. “But in no way will we make cuts that affect patient care.”
Salaries and benefits account for about half of the hospital system’s budget.