Memorial Hospital cutting $3.6 million in operating expenses

Jasper – Memorial Hospital is taking steps to eliminate $3.6 million in operating expenses to overcome losses created by sequestration and the ongoing implementation of the Affordable Care Act.

In April, Medicare reduced its payment to hospitals by 2 percent as part of sequestration. “This reduction impacts Memorial Hospital approximately $1 million dollars annually” said Ray Snowden, President and CEO of Memorial Hospital and Health Care Center. “We’re uncertain how the Affordable Care Act will specifically affect Memorial Hospital; however, we know the government and other payers will continue to reduce payments to providers in the future. We must find ways to reduce our costs while continuing to improve the quality of care provided to our patients.”

Hospitals across the nation are facing similar challenges which were created by the federal government’s sequestration budget cuts and the ongoing implementation of the Affordable Care Act.

[quote]In August, the Indiana Hospital Association published information showing that out of 87 hospitals in the state of Indiana, Memorial Hospital has the lowest charges for inpatient services based on adjusted average charges per case.[/quote]

In August, the Indiana Hospital Association published information showing that out of 87 hospitals in the state of Indiana, Memorial Hospital has the lowest charges for inpatient services based on adjusted average charges per case. In outpatient services, Memorial Hospital has the second lowest adjusted average charges in the state. Ray Snowden indicated that “we are pleased with these results as it demonstrates our commitment to provide value to our community and yet we recognize that our efforts to improve quality and be as efficient as possible are an ongoing process.”

As a part of efforts to reduce costs, Memorial Hospital will realign the Observation Unit and rename it the Outpatient Center at Memorial Hospital. Beginning on October 1, the Outpatient Center will be open Monday through Saturday from 7am to 7pm. Presently, the Observation Unit provides care to outpatients receiving treatments such as blood transfusions and other infusions. The Unit also cares for observation patients needing additional diagnostic testing to determine whether admission to the hospital as an inpatient is necessary.

In the future, the Outpatient Center will focus on the former, while observation patients will receive care in the hospital’s patient tower. “This change allows us to focus care on our outpatients while eliminating this Unit’s expense of around the clock services,” said Kyle Bennett, Chief Operating Officer for Memorial Hospital and Health Care Center.

Memorial Hospital currently employs 1,525 people. Another aspect of the cost saving plan is to not fill certain positions that are currently open and to postpone filling new positions planned for the fiscal year. This accounts for approximately thirty positions that will not be filled. In addition, six positions will be eliminated. These affected positions will be transitioned into similar job duties throughout the organization where possible.

The hospital’s Chief Financial Officer Randy Russell indicated that “Memorial has been reaffirmed with an A- rating and a stable outlook by Standard and Poor’s. This rating demonstrates a strong financial position and is rare for an organization of our size to achieve.”

President and CEO Ray Snowden said, “Memorial Hospital’s dedicated staff, strong financial position, cost saving initiatives and growth strategies provide the hospital with a solid foundation to ensure the hospital and staff are able to carry out the mission to “Be For Others” each and every day in the communities we serve for many years to come.”