Hutchinson Regional Medical Center (HRMC) announced to employees Monday that it is immediately reducing its workforce. HRMC said it based its decision on a benchmarking tool called Action O-I, to help identify areas where department staffing levels are appropriate, under- and over-staffed.

“It’s very helpful to have a measurement tool like Action O-I to properly gauge staffing. In reviewing the data, it was clear that we have more employees than necessary,” said Kevin Miller, president and CEO of Hutchinson Regional.

“While it’s extremely difficult to lay off employees, the long-term financial sustainability of the hospital depends on our being fiscally prudent,” continued Miller. “With reduced reimbursement rates, growing expenses, and increased competition, we simply can’t continue to over-staff our departments.”

Hutchinson Regional patients should not expect any changes in the delivery or quality of hospital services. Providing quality healthcare is still the key mission of the organization and staffing has not been reduced to levels that would compromise the care received.
“Layoffs are never easy, but the hospital has been losing money. We have to make some changes that will allow us to improve the bottom line at a time of great uncertainty in health care,” said Bruce Buchanan, board chairman of Hutchinson Regional Medical Center.
The hospital ended its fiscal year on June 30, 2011, with a $5.54 million operating loss. Last March a similar number of employees were laid off and over the past several months the workforce has been reduced through attrition. In combination with other expense reductions, Hutchinson Regional is running a modest profit for its 2012 fiscal year.
“Like any business, we’re continually looking at how we can improve services, reduce our overhead, and invest in areas that will positively impact our revenue stream. As the community hospital serving a multi-county region, we must stay financially solvent,” Miller said.

The hospital’s strong balance sheet has allowed it to weather the losses, but Buchanan said that is not a long-term strategy.

“These reductions will make us more efficient and competitive,” Buchanan said. “We want to make sure we keep a locally owned hospital that thrives in a challenging environment.”

Employee reductions have occurred at all levels throughout the organization and will dislocate 44 full-time and 11 part-time employees.

HRMC said a severance package will be offered to displaced employees. They will also have access to assessment services, job counseling, job search workshops, and resume and interview preparation through the hospital’s partnership with Kansas Works.