News

January 15, 2009

WVHCS makes layoffs, curbs internal building

Seven management and eight non-management positions cut; 20 temporarily laid off.

By Jerry Lynott jlynott@timesleader.com
Business Writer
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WILKES-BARRE – Holding out as long as it could, Wyoming Valley Health Care System Wednesday announced a limited number of layoffs and curtailed internal construction projects until the economy improves.

The health care system, which operates Wilkes-Barre General Hospital, cut seven management and eight-non-management positions.

In addition it temporarily laid off 20 employees in the plant/facilities construction staff and froze hiring for 55 vacant positions.

Dr. William Host, president and chief executive officer of the health system, said a large proportion of the layoffs is in the hospital, its largest facility. WVHCS also operates a wide range of health care services, including First Hospital, the Thomas P. Saxton Medical Pavilion and Visiting Nurse Association of Wyoming Valley.

The affected employees will receive benefits to which they are entitled, including the opportunity to bid on existing job vacancies.

Overall, the permanent cuts amount to one-half of 1 percent of the system’s 3,200 employees

“My expectation is that this is it,” Host said of possible future job cuts.

The health system has been careful to avoid any adverse impact on patient care, he said.

Still on track is the planned purchase of non-profit WVHCS by a subsidiary of the for-profit, publicly traded Community Health Systems Inc., set for sometime in the first quarter of this year.

The layoffs have “no effect whatsoever” on the sale, Host said.

He attributed the layoffs to the prolonged economic downturn gripping the country and industries across the board and cited a December report by the Hospital & Healthsystem Association of Pennsylvania.

The report said association members are hurting and their patients are feeling the effects of investment losses by hospitals and delays of capital projects.

Among the members surveyed 83 percent report “significant declines in investment income,” and 75 percent forecast “a moderate to significant effect on the financial stability of their facilities through December 2009.”

WVHCS’s investment portfolio lost money and its annual income suffers as a result, Host noted. He declined to put a dollar amount on the loss, adding, “it’s just large.”

The impact of the tough economy would have been greater if WVHCS had not been conducting ongoing evaluations of how work is performed throughout the system. For example, the hospital has lowered the length-of-stay for patients to national standards.

But in response to the “prolonged economic downturn,” WVHCS was compelled to make the cuts, having put them off as long as practicable, Host said in a prepared statement. “We simply cannot wait to act any longer and must institute limited staff reductions.”

Economic prognosis poor for hospitals

A December survey conducted by The Hospital & Healthsystem Association of Pennsylvania showed its members are being hurt by the national recession. Among the findings are:

- 45 percent report increased expenses in accessing capital

- 64 percent are delaying or reconsidering the purchase or upgrading of clinical and health information technology and equipment

- 50 percent report a moderate to significant decrease in admissions, particularly elective procedures

- 51 percent report a moderate to significant increase in uncompensated care

Jerry Lynott, a Times Leader staff writer, can be contacted at 570 829-7237.

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