SVHC excpecting job cuts, budget cuts of up to $5 million
By Patrick McArdle
STAFF WRITER | November 21,2012
BENNINGTON — The president and CEO of Southwestern Vermont Health Care, the parent company of the hospital in Bennington, said he has recently challenged his management team to reduce expenses by $4 million to $5 million, which he said will reduce the number of jobs.
In a letter sent to the Rutland Herald, Thomas A. Dee called that challenge a “first step.”
“To survive with payments at Medicare levels, we will need to reduce our expenses by 15 to 20 percent over the next five to six years,” he said.
While Dee said he wanted the health care system to “transform” to focus on keeping people healthy instead of responding to sickness or emergencies, he admitted the changes might be “unsettling or difficult.”
“This work will lead to changes in the jobs people do within health care. And yes, it will lead to fewer hospital jobs, even as we add jobs in other health care settings,” he said.
The health care system is the largest employer in Bennington County.
Kevin Robinson, communications director for the hospital, Southwestern Vermont Medical Center, said there had been no decisions made about how many jobs might be cut or from what areas of the health care system.
“I want to make it clear, we’re not expecting widespread reductions of (work) force. This is sort of, as we look at where our business is, where our business is going, we’re looking to reduce our work force, especially in the hospital, and then, over the long term, there may be job growth in some of our medical practices,” he said.
The Brattleboro Retreat announced last week that more than 30 positions were being cut. Robinson said the situation in Bennington would be different. However, he said that as the health care system reviews the way it delivers health care, there “may be positions within the organization that are no longer necessary and so those positions may be eliminated.”
Robinson pointed out the $4 million to $5 million challenge was from a $160 million expense budget which meant expenses only needed to be reduced about 3 percent.
According to Dee, the health care system must also become more efficient because health care officials expect payments from private insurance to drop to Medicare levels, which are below the cost of the care delivered.
“That makes reducing expenses an imperative,” he said.
Robinson said that SVHC finished its last fiscal year, which ended in September, slightly ahead of meeting its budget forecast, but the last few months of that year showed a downward trend in the number of people seeking health care services and therefore revenue.
“Because of that, when we look ahead into the remainder of (fiscal year) 2013, we realize that if these trends continue, we will not have a good year in fiscal (year) 2013 so we need to begin making changes now so that we can continue our financial success, continue to meet our budget for the fiscal unit we’re in right now,” he said.
Robinson said the concerns Dee expressed had been discussed among managers for about a month but on Friday, all of the managers met so it could be made “abundantly clear.” The staff of the health care system has also been informed of Dee’s challenge and the potential for positions to be cut.
Robinson said management hopes to have a financial improvement plan within 90 days.