News > Health-Care (/News/Health-Care/)

Dartmouth-Hitchcock
May Lay O As Many
As 460 Employees
By Rick Jurgens
Valley News Sta Writer
Friday, September 09, 2016

Lebanon RELATED STORIES

Dartmouth-
D-H Downgraded By Credit Rater
Hitchcock will
(/Dartmouth-Hitchcock-Credit-Rating-
lay o at least Lowered-4395406)
270 employees,
and as many as 460, before the end of 2016 and will
review its clinical programs with an eye toward saving
money, ocials with the Lebanon-based health system
said Friday.

Details of the layo plans will be spelled out by mid-

October, but D-Hs workforce is expected to be reduced
by 3 percent to 5 percent, according to an email sent out
Friday afternoon by Chief Executive Ocer James
Weinstein.

D-Hs system-wide workforce was 9,239 in June,

according to spokesman Rick Adams.

The review of some of D-Hs hundreds of clinical

programs would entail some extremely dicult
decisions, Weinstein wrote. We cannot be all things to
all people.
Services will be evaluated, not just through the lens of
whether they are nancially benecial, but also in terms
of how they contribute to our patient care, research,
and education missions, he added.

Service line leaders and managers across the

organization would be involved in the process of
identifying where reductions would occur, Weinstein
wrote. The Dartmouth-Hitchcock
(http://www.vnews.com/Keyword?keyword=dartmouth-
hitchcock) system includes Mary Hitchcock Memorial
Hospital in Lebanon, clinics in Lebanon, Manchester,
Nashua, Keene and Bennington, Vt. and four aliated
hospitals: Mt. Ascutney Hospital and Health Center in
Windsor, New London Hospital, Cheshire Medical
Center in Keene and Alice Peck Day Memorial Hospital,
also in Lebanon.

Adams declined to speculate on whether any programs

would be shut down, restructured or otherwise altered.
All options are on the table, he said.

A merit raise program for the current scal year would

not be delayed, Weinstein wrote. The program, which
previously carried an $11 million price tag, now has an
estimated cost of $15 million, according to Adams.

D-Hs current quest for cost cuts began after the health
system discovered a decit that was tallied at $12
million at the end of the scal year that ended June 30.

Disclosure of the decit was preceded by

the announcement in July that D-Hs chief nancial
ocer was leaving to go back to school and would be
replaced by the chief operating ocer. Word of the
decit led to a downgrade in D-Hs credit rating by one
agency and the shift to a negative outlook by another.
And with Fridays announcement of layos, the direct
impact of the shortfall was on course to directly
aect hundreds of employees.

Reductions at all levels of the organization will be

considered, Weinstein wrote.

Late Friday afternoon, New Hampshire Gov. Maggie

Hassan issued a release characterizing the layo
announcement as disappointing and troubling news
and promising to deploy the states rapid response team
to help connect the workers who will be laid o to what
she said are the roughly 4,000 health care job vacancies
in the state. That team is a unit of the states Oce of
Workforce Opportunity that meets with dislocated
workers to inform them about unemployment
insurance, job retraining, health and human service
programs and vocational rehabilitation assistance and
counseling.

D-Hs planned cuts werent crafted overnight.

Weinsteins email said D-H ocials from across the
organization had been working for several weeks on a
performance improvement program that focuses on
optimizing revenues and cutting expenses.

We now know that to achieve nancial stability, we

need to identify $100 million in improvements, and we
need to do this rapidly, he wrote.

The decit surfaced in the wake of a year-over-year

$115 million jump in expenses that resulted from the
changeover to new billing system and the outsourcing
deal that transferred D-Hs revenue management
operations to Conifer Health Solutions, a unit of Dallas-
based Tenet Healthcare Corp., according to Weinstein.

Other drivers of what Weinstein termed unsustainable

increases in expenses were expenditures on supplies,
drugs and so-called travelers who are brought to the
Upper Valley to ll vacancies in the nursing sta, he
said.

Problems with the new billing and revenue

management systems also led to a $40 million
overestimate of revenue. That was equal to about 1
percent of gross revenue or about 3 percent of net
patient revenue, which measures receipts after
discounts included in contracts with insurers.

Weinsteins email included links to four articles from the

past 10 months in Beckers Hospital Review, a trade
publication, reporting on other hospital systems that
posted declines in operating income.

Other great organizations are experiencing similar

downturns with the implementation of new systems
and rising expenses, Weinstein wrote.

Rick Jurgens can be reached at rjurgens@vnews.com

or 603-727-3229.

Clarication

Pending layos announced by Dartmouth-Hitchcock on

Friday that will aect at least 270 employees, and as
many as 460, will not include workers at the aliated
organizations of New London Hospital, Mt. Ascutney
Hospital and Health Center, Alice Peck Day Memorial
Hospital, Cheshire Medical Center, and Visiting Nurse
and Hospice for Vermont and New Hampshire, a D-H
spokesman said Saturday.