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Springfield Hospital System Cutting 27 Jobs, Reducing Salaries



Valley News Staff Writer
Friday, February 01, 2019

SPRINGFIELD, Vt. — Springfield Medical Care Systems on Friday announced it would cut 27 jobs and reduce wages as part of its efforts to find $6.5 million in cost savings and keep the organization afloat amid serious financial challenges

The job cuts will come from across the organization and were chosen “with careful consideration of patient care needs and to minimize the impact on any one area,” according to a news release issued by the health system, which includes the 25-bed Springfield Hospital.

The wage reductions, which will go into effect on Feb. 24, will include 10 percent for salaried positions, 4 percent for hourly staff and a negotiated amount for contracted staff.

“These decisions are incredibly difficult, and we have worked hard to limit staffing reductions as we begin the turnaround necessary to stabilize this organization so that we can provide great care now and in the future,” George Lamb, chairman of SMCS’s board, said in the release.

“Though we know these changes are necessary, we deeply regret the personal impact of this reduction,” he said. “We are grateful to the state, our community and the staff for their ongoing support as we manage through this challenge.” 

Friday’s announcement came after the Vermont Agency of Human Services and Berkshire Bank each loaned SMCS $800,000 earlier this week so that it could make payroll. Otherwise, the system — which has an annual operating budget of about $60 million and employs about 770 people — would have run out of money on Wednesday.

Though Secretary of the Agency of Human Services Al Gobeille said he expects the near future will be a difficult period for the hospital and the community, it’s also an opportunity for positive change.

“Necessity is the mother of invention,” he said in a Thursday phone interview.

Vermont officials required SMCS to find at least $6.5 million in “specific savings” by April 1 as a condition of the state loan, which was an advance to Springfield Hospital of expected disproportionate share hospital payments — state and federal governments payments to help cover hospitals’ costs related to uncompensated care — and a percentage of Medicaid remittances.

The staff and wage reductions announced on Friday may be just the beginning. 

“To be clear, the situation is fluid, and it is possible further staffing adjustments will be necessary,” the release said. “The need to identify further cost savings remains.”

Other potential cost reduction efforts include renegotiating vendor contracts, assessing each service’s sustainability, exploring an affiliation with Dartmouth-Hitchcock and considering a Chapter 11 reorganization “to help stabilize the situation so services can continue into the future,” the release said.

In addition to “high-level discussions” that D-H spokesman Rick Adams acknowleged on Thursday, hospital officials in neighboring communities also have offered to assist SMCS if it has to cut back on services.

For example, Claremont-based Valley Regional Healthcare already had plans to begin offering urgent care, primary care and rehabilitation satellite services on Main Street in Charlestown this spring. By offering services there, Valley Regional could help SMCS, which opened its Charlestown Health Center in 2017.

But any collaboration on that front is tentative at this point, Valley Regional CEO Peter Wright said in an email.

“We have not solidified anything more than a brief conversation as of this date,” Wright wrote.

While Springfield community members say they are concerned about the hospital’s future, they are hopeful that it and the jobs and services it provides might be preserved, said Springfield Selectboard Chairman Kristi Morris.

In the worst-case scenario, a hospital closure would leave buildings vacant in Springfield and beyond, Morris said. In addition to Springfield Hospital, SMCS operates health centers in Charlestown and the Vermont communities of Ludlow, Londonderry, Rockingham and Springfield.

Springfield’s emergency responders are preparing in case the hospital’s emergency room is forced to close, said Morris, a member of Springfield’s fire department.

That would require longer ambulance trips, perhaps to Mt. Ascutney Hospital and Health Center in Windsor, which — including overtime — would add an estimated $100,000 to the town’s emergency services budget, he said. 

Despite preparing for the worst, Morris, a lifelong Springfield resident and semi-retired machinist, said he remains optimistic.

“I think they’ll sort through it,” he said.

In addition to shoring up the hospital’s finances, state officials also are awaiting the results of a forensic audit to understand what caused this situation. 

After the audit is complete, Gobeille said, officials could “begin to talk about accountability.”

Nora Doyle-Burr can be reached at ndoyleburr@vnews.com or 603-727-3213.