Hospital workers feel pain of cutbacks

July 11, 1995|By John Fairhall | John Fairhall,Sun Staff Writer

Once bastions of stability and growth, Maryland hospitals have plunged headlong into a turbulent new era of cutbacks and change that threatens not only workers but their communities.

Forty percent of the Baltimore area's 34,000 hospital employees may be out of jobs in the next five years, warns Local 1199E-DC of the Service Employees International Union, which represents many area hospital employees.

Last month, Liberty Health System laid off 125 of its 1,025 hospital workers and Maryland General Hospital dismissed 70 of its nearly 1,400 employees. Many other hospitals are reducing their work forces by not filling vacancies.

This is a devastating trend for many employees and a blow to communities, especially poor neighborhoods for whom hospitals have been a reliable source of jobs.

"It's kind of hard," said Betty Smith, a mother of two who lost her $6.10-an-hour housekeeping job last month at Maryland General.

longer are hospitals the unchallenged center of the health system. No longer are they immune to the economic pressures that have humbled giants in other industries, like IBM and General Motors.

Advances in medicine and cost-cutting pressures from insurers and employers are cutting into hospital admissions and reducing the amount of time patients spend in hospitals.

Hospitals of the future will be smaller, caring mainly for seriously ill people requiring intensive treatment, industry officials say.

"The trend will continue for the foreseeable future," predicted Cal Pierson, president of the Maryland Hospital Association. "I think the hospitals have to make commensurate changes in staff with the declining volume. There's no other way around it."

The numbers back him up. Maryland is developing a glut of hospital beds and of staff to tend them. There's less need for food service employees, housekeepers, nursing aides. Even the numbers of nurses, who are the backbone and symbol of any hospital, are being cut in some institutions.

By the year 2000, Baltimore-area hospitals may have to trim up to 3,000 beds from the current total of 7,400 -- a 41 percent reduction. Of the 12,500 beds statewide, more than a third may not be needed in five years, according to state planners.

Hospitals also are striving to cut their budgets by increasing efficiency. Those that don't do so run the risk of being priced out of the market by health maintenance organizations and other "managed care" insurers.

The downsizing trend gripped Maryland in 1994. After steadily expanding employment in the early 1990s, the hospital industry reversed course, shrinking 0.6 percent, from 51,126 workers statewide in 1993 to 50,801 last year.

Today, the number is probably under 50,000, and dropping, according to interviews with hospital executives and staff officials.

Although there are some exceptions -- employment rose in the past year at Johns Hopkins Hospital and Johns Hopkins Bayview Medical Center, for example -- hospitals generally are planning for a less-is-more future.

Hopkins, the biggest hospital, has begun a "managed attrition" policy to prevent unnecessary hiring and has implemented a "re-engineering" program that promises to redefine many jobs.

Driving forces

University of Maryland Medical System has hired a consulting company to help it reduce spending this year by $15 million at its hospital, cancer center and shock trauma center.

"The driving forces behind the reduction are decreases in the length of patient stays and being more price competitive with the demands of managed care," said Joan S. Shnipper, University's director of public affairs. "We can't lower our price structure without lowering our cost structure."

University hopes to avoid layoffs during this belt-tightening period. It recently concluded its first "real work-force reduction since 1985," eliminating 79 jobs in the past 12 months, including 27 by attrition, she said.

Managerial positions and jobs in the patient accounting department were among those eliminated, the latter because of automation. Employment now is 4,048.

Sinai Hospital in North Baltimore eliminated the jobs of 59 people in the last 14 months, although 15 of the workers accepted new posts at Sinai, which is also "re-engineering" operations in response to the changing health system.

Counting job reductions from attrition, Sinai's work force has decreased by 200 in the past two years and is now 2,918.

Bon Secours Hospital in West Baltimore has slimmed down to 824 workers, 11 percent fewer than last year.

"You have to balance a lot of worthy needs," said Vic Ribaudo, Bon Secours' chief operating officer, acknowledging obligations to the economically depressed community nearby. "We need to be an effective provider of care as well as a responsible employer. To this point we haven't had to undertake a large-scale layoff as some of the other institutions have."

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