By Jack Molitor
The Herald Bulletin
ANDERSON, Ind. — Last month, St. Vincent Health network announced a five percent reduction of labor expense across the 22-hospital system.
The layoffs are scheduled to take effect Sunday, including 23 employees who have already been eliminated at St. Vincent Anderson Regional Hospital, according to hospital marketing director Randy Titus.
Titus said the hospital's primary objective with the cuts was to not affect patient care, so the focus of the layoffs was in management and non-clinical areas.
In a press release from the hospital system, the Catholic-based network blamed changes brought on by the Affordable Care Act and cuts to Medicare reimbursement.
St. Vincent, the second largest hospital system in the state, is also the sixth largest employer in the state, with nearly 18,000 workers.
“We understand that other health systems are facing similar challenges and making difficult decisions as well,” said Vince Caponi, CEO of St. Vincent Health, in the release. “To sustain our health system’s service to patients and families across the state, we must re-imagine the way we provide holistic care — body, mind, and spirit.”
Titus said St. Vincent Anderson has seen a 3.3 percent reduction in labor costs through several initiatives. Aside from the 23 layoffs from the roughly 1,500-member workforce, other cost-cutting measures have been encouraging early retirement, voluntary reassignment and empty positions being eliminated.
Titus said the five-percent reduction is a network total, and the layoffs are not uniform across each hospital. According to Titus, Anderson won't see any more reduction than the 3.3 percent it has made. He also said a five-percent labor expense reduction doesn't necessarily mean five percent of the workforce.
"This is how we've been affected locally," Titus said. "We've restructured our labor expense to help from a budgeting standpoint."
In a prepared statement, St. Vincent Anderson President Tom VanOsdol said the hospital system was doing its best to adapt to the changes made by the Affordable Care Act, dubbed Obamacare, as well as the recent government sequestration.
"For those whom we will not be able to place, we are offering our support with outplacement services," VanOsdol said. "In years past when we have had to reduce our workforce, we have been able to rehire many of the individuals at a later date into other positions critical to our ministry."
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