By MICHAEL KITCH, LACONIA DAILY SUN
LACONIA — LRGHealthcare announced yesterday that it is laying off 58 full-time employees, including clinical, technical and managerial personnel, as one of several measures to reduce operating costs and improve financial performance amid the changing regulatory environment and economic conditions of the health care marketplace.
Seth Warren, president and chief operating officer of LRGHealthcare who announced his resignation earlier this month, said that layoffs represent less than 4 percent of the total payroll of the organization, which will be reduced from 1,585 to 1,527. He said that approximately a quarter of the layoffs will be at Franklin Regional Hospital and the balance at Lakes Region General Hospital.
In addition, Warren said that during the past several months another 80 positions have been eliminated through attrition. "We took great efforts to reduce staff through attrition in order to decrease the numbers losing their jobs," he said. "That being said," he continued, "any reduction of employees is not taken lightly. We are altering people's lives and for that we are truly sorry."
Cass Walker, vice president of administrative and support services, said that staffing has undergone review since January and a "position review committee" meets weekly to consider whether to fill any vacancies that arise as well as any requests for new positions or additional personnel.
The layoff followed an intensive review of of all aspects of operations throughout LRGHealthcare by Prism Healthcare Partners LTD, a consulting firm, which identified between $15 million and $21 million in both lower costs and higher revenues. Warren said that payroll represents close to 60 percent of operating costs at LRGHealthcare and added "we would like to run below 56 percent."
Warren said that the Affordable Care Act has led outpatient care to displace hospital admissions and reimbursement payments to reward efficient operations. At the same, expanding eligibility for Medicaid has increased the volume of patients. In other words, while the number of patients has grown, the length of their stay has shrunk.
"LRGHealthcare is at or below its target for shortening length of stay," he said. "But, with increased patient volumes coupled with higher costs and generally lower reimbursement than we historically received," he continued, "our challenge is to staff our campuses in line with these changes."
Warren stressed that the reduction of personnel will not impair the care of patients
He explained when the organization was staffed to meet maximum demand "we were sending employees home for lack of work." By what he called "staffing to volume," he said, "we can flex up or down by calling in per diem personnel to staff more efficiently and run more efficiently."
Moreover, Warren said that the hospitals are working closely with visiting nurse associations, nursing homes and other agencies as patients are leave the hospital for more appropriate settings.
"We are continuing to care for our patients after they are discharged," he said.
Without discounting the hardship to those who are losing their jobs, Walker pointed out that there is strong demand for health care workers. Dartmouth-Hitchcock Medical Center is seeking to fill 471 positions and there are two dozen open positions at LRGHealthcare. She said that by laying off rather than reassigning employees, all could compete equally for positions for which they are qualified. She said that the human resources department will assist all employees affected by the layoff and work with the both the New Hampshire Department of Employment Security and the Department of Health and Human Services, which administers the Employee Assistance Program.
Warren said that with the restructuring underway LRGHealthcare will be "operating in the black and able to reinvest in the organization and be well prepared for whatever hits next."
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