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Four senior administrators lose jobs. Hospital considers more layoffs as it lowers costs
By Cheryl Powell
Beacon Journal medical writer
Published on Tuesday, Jan 13, 2009
Akron General Health System recently cut four senior management positions as part of an ongoing effort to restructure the hospital's administration and reduce costs.
''It's been a really tough year, so it was determined that we needed to take some tough steps,'' hospital spokeswoman Rita Kelly Madick said Monday.
Akron General lost money in 2008 after five consecutive years in which revenues exceeded expenses, President and Chief Executive Alan Bleyer said. (The exact amount of the loss wasn't provided because final audited financial information for last year isn't available yet.)
Surgical volume, in particular, dropped in the last part of 2008 as area workers lost their jobs or were required by their employees to pay more of their health-care bills, Bleyer said.
''We've been evaluating the entire organization from top to bottom as it relates to our modest decline in market share last year, and that had an impact on our financials,'' Bleyer said. ''But the bigger issue that occurred during the latter part of the year is the economic crisis that has affected every other employer in the country as well.''
Akron General leaders also are planning for the potential that the new Obama
administration will begin ''ratcheting down'' reimbursement increases for federal health insurance programs, Bleyer said.
''Akron General wants to anticipate and respond to those changes in a proactive way,'' he said.
Among those losing their jobs during the administrative shakeup was Cathy Ceccio, Akron General Medical Center's chief operating officer.
Her position was cut late last month and will not be filled at this time, Madick said.
The three other top administrators whose positions were axed include: Phyllis Marino, senior vice president for marketing and public relations; John Agler, vice president of managed care, and Thomas Lubotsky, president of Akron General Partners, which includes employed physicians, the Akron General Health & Wellness Centers, Lodi Community Hospital and community health centers.
Their last day was Friday.
''Patient care is our No. 1 priority,'' Bleyer said. ''If you were to think through the executives who were affected by this restructuring, all four are administrative positions. None of the executives were supervising direct patient providers.''
Bleyer said hospital leaders are continuing to evaluate the best way to reorganize the staff.
Layoffs are possible, Madick said.
''This is going to be an ongoing process to reach stability,'' she said. ''Is there a list now? No. Is there a layoff possibility? Yes, but nothing would be communicated to the public before it was communicated to the staff.''
Madick said Akron General hasn't determined how much money will be saved by the administrative cuts because the restructuring process is ongoing.
Akron General is among Summit County's largest employers, with more than 5,400 employees in the county.
Hospitals throughout the nation are struggling to cure financial problems caused by the nation's ailing economy.
A recent report from the American Hospital Association found hospitals collectively posted a negative operating margin of -1.6 percent in the third quarter of 2008, compared to a positive margin of 6.1 percent during the same period in 2007.
As a result, 60 percent of hospitals said they might cut administrative costs, according to the survey. More than half (53 percent) indicated they were considering staffing cuts as well.
Akron Children's Hospital is continuing quality and performance improvement initiatives it started last year, Chief Operating Officer Mark Watson said.
Children's also is among the county's largest employers, with 3,463 workers in Summit County.
No layoffs are planned, Watson said, but hospital leaders ''are looking very carefully at the positions that are approved to make sure they are absolutely necessary.''
Summa Health System does not plan to cut positions or reorganize its staff at this time, President and Chief Executive Thomas J. Strauss said.
But as more people lose their jobs, Strauss said, the health system expects to be treating more uninsured patients.
Every 1 percent increase in the number of uninsured Americans translates into an estimated 1 million additional people without health insurance, he said.
Summa is Summit County's largest employer, with 8,207 employees.
''Obviously, we're working on contingency plans in light of the economy,'' Strauss said. ''But right now, we're not looking at any staff reductions or freezes.
''What we're doing is preparing ourselves for a tough year.''
Cheryl Powell can be reached at 330-996-3902 or chpowell@thebeaconjournal.com.
Akron General Health System recently cut four senior management positions as part of an ongoing effort to restructure the hospital's administration and reduce costs.
Get the full article here.
Comments
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Akron, Oh
Posted 06:46 AM, 01/13/2009
I don't understand how they could be losing money.... My husband's hopital bills for his stay there was over $700,000.00. And, he's just one of how many patients treated there last year ?????
Posted 10:45 AM, 01/13/2009
Malpractice Insurance.
Posted 11:42 AM, 01/13/2009
I wonder if the dismissed persons expected this. Peculiarly enough, I was leaving AGMC very early in the morning last month. I encountered Ms Ceccio in the lobby on my way out. She was the only person there besides myself. We had a pleasant conversation. She told me of her many years of service. I did not realize that when we said goodbye to one another that it was probably forever. Best wishes to Ms Ceccio.
rmk, akron
Posted 11:55 AM, 01/13/2009
and the uninsured.
Akron, OH
Posted 05:50 PM, 01/13/2009
Hey there: The total bill was over 700,000, but how much is AGMC actually going to collect. They can charge what they want, but beyond collecting from the insurance, most people are not going to be able to pay the full bill without going bankrupt. Especially uninsured. The bills are so staggeringly huge that the hospital is glad to get half, if that. So now the bill is that much higher for the next person.
akron, oh
Posted 10:21 PM, 01/13/2009
Less jobs, less insured people=more free care. You can see a Doctor at his/her office without paying so they all go to the ER for the only care they can get---Free Care.
Posted 07:18 AM, 01/14/2009
Hey Beacom Journal.. How about a story outlining the pay and perks of Childrens' CEO and others?
Posted 08:21 AM, 01/14/2009
The CEO's of all the companies is what is hurting them. They all make to much money and you don't see them taking pay cuts.
Posted 09:36 AM, 01/19/2009
yeah fat cat managment who does NOTHING... we all have those friends of the CEO who slack.
Im sure those 4 spent lots of times in meetings and at the country club :)
