Tuesday, September 14, 2010

When the state reneges

Boston Medical Center issued this statement yesterday:

Boston Medical Center announced today that it has made a reduction in force of 119 people, including 44 nurses and 30 management staff. Another 40 employees will see their hours reduced. The hospital has a total work force of almost 6,000 people, more than 1,500 of whom are nurses.

“The hospital is projected to lose $175 million this year due to dramatic changes in Medicaid reimbursements,” said Tom Traylor, BMC’s vice president of federal, state and local programs. “We have been talking to the staff about this new reality for well over a year, and have been working to assess and increase efficiency in every corner of the hospital. We have been consulting with outside experts to study the efficiency of delivery of patient care, and they found very little excess capacity particularly in terms of hospital staffing levels. This layoff is one necessary element of addressing the hospital’s financial situation.”


This situation is a shame. When BMC was created and throughout its history, there has been a recognition of its special role, the largest "safety net" hospital in the region. It received promises during the debate on the state's universal access legislation that this role would be supported and preserved. When the state reneges on Medicaid reimbursements, all hospitals are hurt, but this one especially so.

If you do the math, a reduction in force of 119 people does not make up $175 million, so the hospital is surely making other difficult choices. They are lucky to have Kate Walsh, an excellent administrator, as CEO. But there are limits as to what any one person can accomplish when a major payer walks away from its obligations.

7 comments:

Elaine Schattner, M.D. said...

Really worrisome - I've never been in a hospital where there were sufficient nurses, aides, or clerks.

In my experience, when there aren't enough clerks, transport workers or phlebotomists, physicians take on those tasks themselves. But most docs are already at their limit; they'll get less sleep, besides have less time for examining patients and reading.

Russ said...

From Facebook:

When you only pay 70 cents on the dollar of cost and you rely on that payor for the bulk of your business, real people get hurt. Having worked at BMC in the past, it is a great institution with a storied legacy of caring for society's most vulnerable.

DonB said...

Staffing and other program cuts in conjunction with EMTALA is the prescription for a health care 'black hole'.

All those Cambridge brains must be embarrased that they failed in practice what they espouse academically.

Anonymous said...

BMC has been spending hand over fist on new buildings and trying to compete w/AMCs. There has to be more accountability and a way to prevent the technology arms race (which you have written about) in MA. We can't have every hospital doing every thing and getting paid top dollar.

Paul Levy said...

I certainly understand your point about the arms race, but are you also suggesting that they shouldn't be paid the same as other places?

Anonymous said...

Paul - BMC had been living for decades being paid something like 95% of charges for all care they delivered via the "free care pool" for the uninsured. This type of reimbursement is unheard of and it lasted for decades down there. As part of the state healthcare reform they phased this nonsense out over a couple of years and BMC knew they would be seeing people with state subsidized insurance (read negotiated rates and fees) as opposed to the old 95% of charges free care pool. They simply didn't make any of the difficult decisions they needed to and they are now running back to the state and federal government looking for more money (taxpayer money of course). Their CEOs have been making a million dollars a year and didn't implement changes to address issues that they knew were coming. Their staffing levels are far above a similar facility of their size so let them make the cuts they need to in order to be competitive.... we can't simply run back to the taxpayers to bail them out every time they need more money and want to maintain the status quo. Taxpayers are tightening their belts so let BMC do the same.

Keith said...

Indeed it would be better to have all the "non profit hospitals" who want to herd the patients who lack insurance, or are underinsured, into the wards of one institution which is usually a publicaly funded hospital. As commmunity hosptials in poorer neighborhoods have gone out of business, more of the burden gets heeped on these remaining public institutions. All the while the medical elite sit in their gleaming new hospitals bemoaning this develpoment while doing most everything they can to avoid or deflect their responsibility as a so called non profit institution. Boards that have approved expensive new bricks and mortar projects and lavished increasingly higher paychecks to their administrators are to blame. You should be ashamed to place blame solely on Medicaid for this impending disaster.