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Cheshire Medical Center Cuts 34

Keene, N.H. — Cheshire Medical Center/Dartmouth-Hitchcock Keene has eliminated 34 jobs in an effort to save about $1 million.

Twenty-two vacant jobs won’t be filled, and 13 people will be laid off. Five of those employees will be offered other jobs, officials said yesterday. The positions were scattered throughout the hospital and clinic, and some were longtime employees, said Chief Financial Officer Jill I. Batty.

Hospital officials declined to give more details on what jobs were cut.

Officials say significant cutbacks in reimbursements for Medicaid and Medicare services by state and federal governments have hit the hospital hard.

“I am extremely sorry this action is needed. This reduction in force is necessary for us to strengthen our organization to ensure a sustainable health system for our community,” CEO Arthur W. Nichols said in a news release earlier this week.

“The state of New Hampshire suddenly stopped reimbursing our Medicaid Enhancement Tax in 2011 and that has cost us over $11 million in the last 18 months. These are times of great change in health care. Change can be challenging and comes with tough decisions. Today is certainly one of those times.”

The job cuts come as hospital officials work to cut $7 million from an operating budget of $180 million. The cuts are expected to save about $1 million through the end of fiscal year 2013 and $2.2 million in 2014, officials said.

Hospital officials previously said there could be cuts to some programs as well, although they said Vision 2020, the long-term program that aims to make Keene the healthiest community in the nation by the year 2020, would remain on course.

Officials are still evaluating which programs will be cut, they said yesterday morning.

Hospital officials said in December recent trends toward high-deductible health insurance plans have apparently led to increases in outstanding bad debt, which includes unpaid patient bills, and also to reductions in the public’s use of some medical services. The number of patients, which at the hospital averages more than 30 filled beds at any one time, is down, and demand for outpatient services is also off.

Operating margins have steadily declined from 3.6 percent of revenues in 2008, when the nation’s economic recession took hold, to a projected loss of 2.6 percent in 2013, hospital officials have said.

This morning, hospital officials said there will be no pay cuts for employees, as they are looking at long-term strategies and consider pay decreases a short-term fix, Batty said.

The 13 people who were laid off can apply for other vacant jobs, officials said.

The hospital employs more than 1,000 people full-time, making it one of the largest employers in Cheshire County.

CLARIFICATION

This article has been amended to correct an earlier error. The following clarification appeared in the Friday, Feb. 1 edition of the Valley News:

Cheshire Medical Center/Dartmouth Hitchcock Keene eliminated 34 jobs in a move to reduce costs. The headline on Thursday's story was unclear on the location.