Stephens County Hospital announces cost-cutting measures that will affect the hospital’s employees.
Hospital Administrator Ed Gambrell announced this week that effective December 1, employees making over $10 per hour will see a 5 percent decrease in pay effective December 1.
In addition, Gambrell said the hospital will eliminate some positions throughout the hospital, affecting about seven people.
Regarding the pay decrease, Gambrell said employees making less than $10 per hour will not be affected and no employee making more than $10 per hour would see their pay drop below $10 per hour.
Gambrell said the decision comes as a result of continued financial challenges at the hospital coming from economic pressures.
“Although I think sometimes people blame the economy for even more than it should be blamed before, the economy poor,” said Gambrell. “That has meant that there have been more people out of work and therefore, they do not have health insurance or people work but they no longer have health insurance or they still work and have health insurance, but it has a high deductible and not as good a coverage as it once did.”
Gambrell said the hospital has taken other cost-cutting measures previously in an effort to avoid these steps.
However, he said he feels they are now necessary.
Gambrell said it is not an easy decision.
“It is just one of those things that is difficult and painful to do, but at the same time, it is the kind of decision that you have to look at where you are,” said Gambrell. “Sometimes good leadership demands tough decisions. This was one of those times. It would be easy to put our heads in the sand and just hope things get better. Maybe they would, but there is a better chance that they would not.”
Stephens County Hospital Authority Chairman Mark Wilkinson echoed that, saying that while it is not a decision the Authority wanted to make, it is one the Authority felt was in the best interest of the hospital at this time.
The pay decrease alone is expected to save the hospital $1.2 million this Fiscal Year.
Gambrell said he hopes the savings will stem the tide on the hospital’s bottom line and that more cuts would not be needed.
“I am confident that with these measures we will have a more successful year from a financial perspective in 2014 than we did in 2013,” said Gambrell.
Gambrell said that this decision is not tied in any way to the hospital’s ongoing dispute over Medicare regarding around $800,000 that Medicare has withheld from the hospital, adding that the decision to make these cuts was made separate of that issue.
Also, Gambrell said the hospital is confident that its wound care center currently under construction would not only provide a valuable service but contribute in a positive way to the hospital’s bottom line.
“We feel confident it will operate in the black very quickly, so it will not be a financial burden on the hospital,” said Gambrell.
Gambrell said the hospital hopes to open the wound care center in January.
Gambrell and Wilkinson also said that if the hospital’s economic picture improves, reinstating some or all of the cuts would be considered.