FORT KENT, Maine — A major health care facility in the St. John Valley has cut a number of administrative positions, reduced remaining administrators’ pay by 2 percent and restructured its operations in order to stabilize its finances.
Northern Maine Medical Center has eliminated four administrators and shifted job responsibilities at the 49-bed hospital, Martin Bernstein, NMMC’s chief executive officer, confirmed Thursday. The affected employees were notified last Friday.
Bernstein said the cutbacks were necessary because of a decline in inpatient activity at the facility, a factor that has necessitated restructuring and budget tightening at other hospitals in Aroostook County and across the state.
The CEO said that adjustments are expected to save the hospital and its affiliates $428,000 over the next seven months of the fiscal year, and $733,000 over a 12-month period. The health care umbrella organization also encompasses Forest Hill Rehab & Skilled Nursing Center, a 45-bed nursing and rehab facility, and seven health centers located throughout the St. John Valley.
“We had to make the cutbacks and consolidate several departments under one manager-administrator to counter the declining revenue that we’ve seen because of the decline we’ve seen in inpatients,” Bernstein said Thursday. “Department heads and administrators also have taken a 2 percent salary reduction to help the situation.”
As part of the reductions, the hospital eliminated its public relations-community development position. Bernstein will take over those responsibilities. The hospital’s respiratory therapy director position also was cut. Department personnel now will report to the director of X-ray services.
“The director has had previous experience overseeing X-ray services at another hospital,” Bernstein said.
The hospital also has done away with its director of education. Clinical education services now will come under nursing services, and nonclinical education services will be under the umbrella of the human resources department.
Finally, the hospital has eliminated the administrator at the Forest Hills Center. Peter Sirois, the chief operating officer at NMMC, has a nursing home license and will assume that position, according to Bernstein.
“So we will have the same amount of work being done by fewer people,” said the CEO. “We are not giving up any services. We will be monitoring the inpatient situation over the coming months to see where we stand and then go from there.”
Bernstein said that several factors contributed to the decline in inpatient activity, but it was mainly due to the downturn in the economy.
“People have lost jobs and they’ve lost health insurance,” he said. “People have put off elective surgery, cut back on their doctor visits and cut back on their medications.”
That downturn also has led to an increase in bad debts at the hospital and a higher percentage of patients who are covered by MaineCare and Medicare.
“Those programs do not pay as well as private insurance on the inpatient side,” Bernstein said.
He said that the latest cuts were not related to the debt that the state owes the facility for the care it has extended to patients covered by the MaineCare program, although the hospital is at odds with the state over the actual debt.
Bernstein said that the hospital believes the state owes the facility close to $2 million for care extended to MaineCare patients over the past several years, but the state believes their tab is closer to $800,000.
“We are both going over our books so that we can come to a resolution,” he said.
The reduction in patient volume is not just affecting NMMC. Tom Moakler, the CEO of Houlton Regional Hospital, said late last year that the Houlton hospital also had seen a decline in the number of patients it usually sees, mainly because of the economy. In some areas, the volume of patients was down 4 or 5 percent. The hospital also experienced a decline in emergency room visits and inpatient stays. Because inpatient stays were down, so were the number of tests, such as X-rays and blood work.
The same scenario took place at The Aroostook Medical Center in Presque Isle last fall. Financial issues led the hospital to offer close to 30 employees early retirement packages and related incentives.
Jeff Austin, vice president of government affairs and communications at the Maine Hospital Association, said Thursday that hospitals across the state also are encountering similar problems. He said that the MHA didn’t have specific figures, but that he had heard a number of facilities talk about a decline in patient volume.
“People who lose their jobs take a double hit,” he said. “They lose their health coverage and they lose their income. It is hard to deal with. Medical care is often the first thing they put on the back burner.”