University Hospital cuts to save $24 million in '96 46 beds and 255 jobs to be eliminated

November 09, 1996|By M. William Salganik | M. William Salganik,SUN STAFF

Under relentless pressure to trim costs, the University of Maryland Medical System said yesterday it will eliminate 46 beds at University Hospital and trim 255 jobs as part of an effort to

shave $24 million this year.

Officials of the University of Maryland Medical System said the cutbacks represent a response to a continued drop in the average length of stay in the hospital -- down 22 percent in five years -- leaving the hospital with more and more vacant beds even while the number of patients admitted remains steady.

"There's tremendous pressure on the revenue line with fewer jTC days of care," said Robert A. Chrencik, senior vice president for finance. Length of stay is dropping because insurers demand it and because technology permits it, said Dr. Stephen C. Schimpff, executive vice president.

Licensed for 747 beds, the hospital will now be staffed for about 550. Like virtually all other hospitals in Maryland, University has been operating fewer beds than its licensed capacity, as patient censuses have dropped.

The hospital will reduce its staffing in patient care -- nurses and "nurse-extenders" -- by 55, from 3,040, and supervisors and employees not involved in care by 200 from 2,460, according to Joel G. Lee, vice president for market development and communications.

Schimpff said all nurses and other staff involved in direct patient care, such as aides and technicians, will be transferred to other jobs.

Of those not directly involved in care, about one-third of the 200 eliminated jobs represent positions that are vacant. Some of the remaining 140, Schimpff said, may be offered other jobs in the medical system, but some -- the exact number won't be known for two weeks -- will be laid off.

The system is able to reassign much of the staff, he said, because it is growing in areas such as subacute care and primary care clinices.

The staffing changes, officials said, will not result in any change in the ratio of nurses to nurse-extenders, although the hospital has been gradually increasing the proportion of nurse-extenders over several years.

"We are always looking for the lowest-cost source of competent labor," Chrencik said.

The cutbacks come as the hospital has been increasing in profitability -- from $3.9 million in net income five years ago (1.3 percent of revenue) to $17.5 million in fiscal 1996 (4.1 percent of ,, revenue). The system needs to generate surpluses to meet its "huge" capital requirements for construction, renovation and technology, Chrencik said.

Also, he said, the system is under pressure to keep costs low from state regulators -- who recently listed University sixth and Kernan seventh on its list of most expensive hospitals, according to a complex system designed to adjust for how sick the patients are.

He said employers and the government are increasingly turning to managed-care insurers, who seek lower-cost care providers.

Pub Date: 11/09/96

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