TIFTON, Ga. -- As many as 40 people working at Tift Regional Medical Center -- in clinical and non-clinical positions -- were informed Monday that their jobs were being eliminated as part of a cost-saving initiative.
Tift Regional announced it will carve out $14 million in annual expenses through a cost-reduction initiative designed to meet challenges in future health care delivery, which includes streamlining its operating budget by 5 percent to include a work force reduction of 40 positions.
The hospital launched the initiative from a position of strength, said Tift Regional President/CEO William T. Richardson, who said the move is an investment in the future of the hospital and the community it serves.
"Our goal is to eliminate redundancies and reallocate resources to focus on areas that offer the highest growth opportunities for TRMC," Richardson said in a news release. "Employees impacted by the staff reduction will be offered a severance package, and we will try our best to help them find another job within the organization."
Richardson said the hospital is very sound financially but must prepare for pending changes in federal health care reform. Like most industries throughout the country, hospitals are also facing an uncertain national economy.
The single-largest expenditure made by the U.S. government is payments for Medicare and Medicaid, officials say.
"More than 60 percent of our revenues at TRMC come from services provided to Medicare and Medicaid patients, and we are certain that the federal government will be making substantial cuts to these reimbursements," Richardson said. "We have to be prepared for this new business model."
On Nov. 1, Tift Regional engaged in a strategic performance and cost-reduction initiative which examined opportunities for reducing expenses and maximizing efficiency within the organization. It gathered input from medical staff physicians and organized special task forces with a cross-section of hospital managers over a three-month evaluation process.
The hospital examined supply costs, purchased services, process improvement and labor costs.
"By carefully listening to the ideas of our employees, managers and physicians, we evaluated every aspect of our organization to ensure we are delivering the best possible value," said Richardson. "It is imperative to examine costs and improve efficiencies now in order for TRMC to remain fiscally solid in later years.
"Many hospitals are not as financially secure as TRMC. It is best to address these issues now and not allow a state of financial deterioration to occur before acting. In such a scenario, the impact would be more significant."
Richardson added that other successful hospitals from around the state have proactively engaged in strategic performance- and cost-improvement initiatives, including Piedmont Hospital in Atlanta and Hamilton Medical Center in Dalton.
"The results have been empowering for each organization," he said. "In this era of health care reform, hospitals like TRMC must operate leaner and demonstrate cost-value to patients as well as the federal government and other third-party payers.
"We must increase the efficiency with which we deliver care; we must improve patient safety and patient outcomes; and we must do everything we can to reduce and restrain the cost of operations."
The hospital is Tift County's single-largest employer with 1,700 employees. Services provided by TRMC include surgical specialties, oncology, cardiovascular care, women's health, neurodiagnostics and medical imaging. In fiscal year 2011, Tift Regional provided $83.2 million in charitable/indigent care and uncollectible services.
"We are doing this initiative to help define and secure the future of Tift Regional Medical Center so we can continue to be an economic engine for the community and provide the quality services that our region has come to expect from us," said Richardson.