Prompting some employee concerns about benefits and job security, Duke University Health System plans to eliminate 300 positions in response to budgetary pressures caused by cuts to government reimbursements and higher health care costs, officials announced last week.
Bill Donelan, DUHS executive vice president, said the cuts would not adversely affect patient care and predominately would be taken from Duke Hospital and the Patient Revenue Management Organization, which are in relatively better budget positions.
However, the cuts, which represent about 3 percent of DUHS's 10,000 positions, likely will not translate to 300 people losing their jobs, Donelan said. Many of the positions eliminated are already vacant, and the Health System will try to transfer employees whose jobs are eliminated to other positions within DUHS or the University.
In addition to the 300 eliminated positions, 100 more will be cut through attrition.
The announcement drew mixed reaction from employees. Some said they were not concerned about losing their position or the quality of care.
Cathy Williams, staff specialist in the Division of Urology, worried patient care would diminish if jobs are overly consolidated.
"If they are taking away some of the PRMO, how long will it take patients to register?" Williams said. "If they combine too many jobs into one, they might have too many patients to take care of and that wouldn't be good patient care."
DUHS has lost a net $200 million in the last five years, and Donelan attributed the loss to the federal Balanced Budget Act of 1997, which he said has led the state to make reductions in Medicaid and Medicare reimbursements. The problem is amplified by cuts from the federal government, which matches state reimbursements two to one.
Anticipating that North Carolina's current budget crisis will likely lead to more cuts, Donelan said the system preemptively reacted by proposing position elimination--which should save $15 million in the next fiscal year--as well as other cost-saving measures, like procurement efforts that have saved over $16 million. "It's an opportunity to do more with less, but at the same time there are limits," Donelan said.
In 1994, faced with budgetary pressures and inefficiency, the Hospital announced it would eliminate 1,000 to 1,500 positions, and experts predicted that 600 to 800 people would be left unemployed. In reality, less than 30 people were left unemployed.
However, Donelan said that he expects over 100 people will end up jobless in this cut. "It will be more difficult this time," he said. "The state of employment and the economy is not as good."
Donelan said that if the economy continues to worsen or the state cuts reimbursements further, more job cuts may be necessary.
Robert Warren, who works in the Department of Community and Family Medicine, described the mood of the Hospital staff as cautious.
Williams agreed. "People are wondering if their jobs are getting cut next," she said.
Williams also expressed concern about DUHS's plan to change eligibility requirements for supplemental health insurance primarily for employees hired after July 1, 2002. Officials said the reduction will save $11 million next year.
In addition to the national trend in health care cuts, DUHS also has faced more charity cases because of new immigrants and more people qualifying for Medicaid in the weakening economy.
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