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Thursday, May 23, 2024

Web Exclusive: Cutting Programs Becomes a Way of Life at Local Hospitals

The following story is available only on the Business Journal website Over the past four months, three Valley hospitals announced that they were cutting staffers and departments, alike. It began in September when Glendale Memorial Hospital decided to drop its Behavioral Health Services department and outpatient women’s clinic. As many as 100 employees were affected by the closures. Then, in October, Valley Presbyterian Hospital in Van Nuys parted ways with 35 staffers. Most recently, Providence Saint Joseph Medical Center in Burbank announced Jan. 20 that it was cutting 94 staffers and closing five programs. Each hospital downplayed the significance of cuts made. In particular, representatives of Glendale Memorial Hospital and Saint Joseph Medical Center stressed that Valley residents could access such services elsewhere. Considered collectively, though, are the cuts indicative of an ominous future for health care in the Valley? Yes and no, said Jim Lott, executive vice president of the Hospital Association of Southern California. “This is the time of year where hospitals look to make budget corrections. That’s not unusual at all,” Lott said. At Saint Joseph, cuts include the cardiac rehabilitation program and transitional care unit. Also on the chopping block are the off-site urgent care, occupational health and diabetic foot centers. “We will help those people find other facilities in the area, including at one of our own facilities, Saint Elizabeth Care Center in North Hollywood,” spokeswoman Patricia Aidem said. “There is some crossover between transition care and convalescent care.” Saint Elizabeth and other area medical centers may find it challenging to absorb the cuts made by nearby hospitals. Saint Elizabeth, for one, only has 52 beds. The ability of Valley health care centers to compensate for the cuts others have made isn’t the only concern. Lott said that he is worried about the economic pressures that have forced hospitals to make cuts. Specifically, he fears that the economic downturn may result in hospitals dealing with a flood of uninsured patients. He estimates that between 17 and 25 percent of patients in the Valley are currently uninsured, a figure that could rise if the recession worsens. If that happens, hospitals’ financial woes would worsen because those with emergency rooms must treat all patients, regardless of ability to pay. Glendale Memorial and Valley Presbyterian cited insurance matters as a primary reason they made cuts last year. Insurance reimbursements not meeting operating costs was the reason The Motion Picture and Television Fund will close its hospital and long-term care facility later this year, citing a $10 million deficit. The closure results in the loss of 250 jobs and sending patients to other facilities. On the other hand, Lott is also concerned because area hospitals are seeing a 30 percent decrease in patients seeking care for conditions that don’t constitute medical emergencies. Even patients with insurance are forgoing such care because they don’t want to pay for the out-of-pocket expenses. “Since the economy went south in November, we’ve already seen hospitals’ profitable services decline,” Lott said. In fact, Saint Joseph officials said that a decline in patient admissions and surgical volume were mainly responsible for the cuts it recently made. If patient volume continues to decrease, hospitals will be forced to make more cuts. And, contrary to popular opinion, hospitals aren’t recession-proof, Lott stressed. “The demand (for health care) is recession proof but not the hospitals,” he said. Fortunately, those laid off by hospitals are likely to survive the recession without becoming destitute, especially if they belong to the clinical side of the workforce. “Nurses, occupational therapists, physical therapists,they’re in great demand because they’re in short supply,” Lott said. “Healthcare workers usually can find work elsewhere pretty easily. Most of the hospitals have a 12 percent vacancy factor. They’ll easily find a job.” At Saint Joseph, the number of employees cut represents less than 4 percent of the organization’s 2,517 workers, according to Aidem. Another positive about the cuts is that Saint Joseph’s “core services” in emergency care, the ICU, surgery centers, and critical patient-care components will remain unaffected. One reason the layoffs occurred was to ensure the continuity of services, which treat the critically ill, she explained. While Aidem declined to say how much savings the job cuts will generate, she assured that the cuts were necessary and would help the organization stay in the black. “A lot of programs that are not part of our core services for critical care are revenue-eating programs,” Aidem said. “Then, there are revenue-generating programs that subsidize critical care.” The recent acquisition of other facilities in the Valley, the problems on the financial side of the healthcare industry, as well as the downturn in the economy made streamlining operations at all of Providence Health & Services locations in the region more logical, and more necessary, than ever before, Aidem said. One example of why relates to the closure of Saint Joseph’s now-defunct diabetic unit. “We have a very good diabetic unit at Tarzana; that’s one of the ways our three hospitals are working together to make sure the Valley is served with the full spectrum of services,” Aidem said. But some Providence programs are so revered that their permanence is all but assured, according to Aidem. “If you’re going to have a stroke you want to go to Providence Saint Joseph,” she said. “Furthermore, both Holy Cross and Saint Joseph are designated centers for the worst kinds of heart attacks; ambulances will pass by other hospitals to bring patients here.” In order to have premier critical-care services, however, others will have to go by the wayside, Aidem said. “The point is, sometimes you have to cut some of the lesser-used services to stay sure the key programs are solid,” she said.

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