Twenty-nine employees of St. Vincent Health System were laid off Thursday and Friday, CEO and President Peter Banko confirmed today. Another 21 left in November, though Banko attributed that to "normal attrition."
St. Vincent made the move as part of a plan to cut $12 million from its budget. Patient volume is higher so far in the fiscal year, Banko said, but not as high as anticipated. The layoffs saved the hospital $2.5 million; Banko said he hopes the remainder will come in savings from changes in clinical care, length of stay and from employee physicians, who are being evaluated for productivity and efficiency in their practices. Banko called the cuts precautionary. The hospital is half-way to its goal, and expects to complete the cuts by the end of the year.
None of the employees who were fired were involved in direct patient care, Banko said. St. Vincent has some 3,000 employees, who work the equivalent of 2,300 full-time jobs.
Banko also said it's essential for the health of hospitals that the Arkansas legislature agree to the Affordable Care Act's expansion of Medicaid. The hospital's Medicare reimbursements are declining, and nationally hospitals expect — in fact, believe they had a deal with the Obama administration — to have an expanded Medicaid patient base to offset Medicare cuts. Banko also said expanding Medicaid coverage would be good "from a fellow human standpoint. ... I don't think it should be political. It would be the right thing."
Banko acknowledged Republican opposition to the extension, "but at the end of the day it's putting your neighbors and folks that need access to care in jeopardy."
Can St. Vincent survive without entering into a joint operating agreement with the University of Arkansas for Medical Sciences, as the two institutions are considering? "I think both organizations can cut expenses to be able to weather some of the storm," Banko said.
However, he added, if a collaboration would cut costs "I think it will help both organizations. I don’t think it’s necessary to have a partnership but having said that, I think it makes sense to the community." He noted a deal worked out in Kentucky to overcome the state's resistance to the merger of the University of Louisville with Catholic Health Initiative’s Kentucky operations: Women's health services will be run by the university unchanged, with no say from the church.
In the Kentucky deal, CHI would invest $543.5 million of investment in university medical operations during the first five years of the JOA, according to Insider Louisville. No such investment has been talked about publicly in Arkansas.