May 26, 2012

Cost reductions at MaineGeneral mean 47 fewer jobs

Fifteen positions to be eliminated; 32 openings to remain unfilled

By Betty Adams badams@centralmaine.com
Staff Writer

AUGUSTA -- MaineGeneral Medical Center is trimming 47 positions from its staff as a cost-cutting measure to meet its almost $400 million operating budget for the next fiscal year.

The move means 15 jobs will be eliminated and 32 vacant positions will not be filled, hospital officials said.

Those losing jobs have 45 days to apply for another job within the hospital, said Chuck Hays, president and chief executive officer for MaineGeneral Medical Center.

Staff reductions affect both MaineGeneral Medical Center and the parent organization, MaineGeneral Health, and are spread throughout the organization, Hays said.

"Three of the open positions were clinical," Hays said Friday. "The rest were support and administrative."

The hospital is building a $312 million regional hospital in north Augusta that will incorporate inpatient services from the Thayer campus in Waterville and replace the hospital on East Chestnut Street in Augusta.

Hays said that the job cuts will not affect the massive project.

MaineGeneral has more than 2,900 employees, according to its website. Almost 1,000 more people are employed at the other facilities operated by MaineGeneral Health.

MaineGeneral Health sees employee turnover of about 300 people a year, Hays said.

The hospital cut an unspecified number of jobs in February 2009, and a year earlier cut 11 jobs, again to reduce costs.

In January, administrators at the MaineGeneral Medical Center announced other cost reductions totaling $5 million to compensate for a downturn in revenue.

At the time, it appeared fewer people than anticipated were using the hospital services. Action by the Legislature this year to cut state reimbursement funding for hospitals also had a negative impact on the hospital's revenue stream.

Steven Michaud, president of the Maine Hospital Association, said MaineGeneral is not alone in its latest round of cuts, citing Mount Desert Island Hospital in particular. That hospital reportedly was eliminating nine jobs.

"Some have already eliminated positions," he said. "A lot of other hospitals are looking at the budgets very carefully."

Michaud said some hospitals that start their fiscal year Oct. 1 have already made mid-year adjustments.

Hays said Friday the latest reductions in staff at MaineGeneral are directly tied to that legislative funding cut, which takes effect July 1. The reduction in staff result in a $3.5 million savings in the budget, which is roughly equivalent to the state cutbacks, he said.

"This is for our budget that starts July 1 and is due to decreases in both MaineCare and Medicare," Hays said. "This basically allowed us to address those reductions in reimbursement." MaineCare is the state's version of Medicaid.

Michaud pointed to a couple of reasons for the cuts.

"There is an overall reduction in the use of hospital services, and that's affecting this, and on the Medicaid side there is a reduction in payment," Michaud said.

He pointed to a heavy Medicaid debt of $460 million that's owed to the hospitals; it's been accumulating at the rate of $120 million a year.

"We do anticipate that going down dramatically because this administration has changed the payment system. It should now stop accumulating debt as rapidly and it will be nowhere near that number," he said.

Betty Adams -- 621-5631

badams@centralmaine.com

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