Sault Area Hospital hires more staff. To reduce its deficit

One of the key challenges facing Sault Area Hospital's plan to balance its budget is overtime costs, says Ron Gagnon, the hospital's chief executive officer and president.

That plan calls for more staff, and more efficient scheduling of staff, Gagnon was explaining to reporters after a hospital board meeting last night.

"Our goal is to have the right staff in the right places at the right times," he said.

Rick Cooper, SAH vice president and chief financial officer, told board members that a shortfall of at least $12 million is expected for the 2007/2008 fiscal year and there has to be a plan in place to balance the budget.

"An outside consultant will be hired to oversee an analysis of where the hospital can become more efficient," Cooper said. "The goal is to balance the budget in two years."

Cooper says this goal can be accomplished with better staff scheduling, maximization of preferred accommodations and uninsured revenues, reduction of energy costs and better in-patient bed management.

"The hospital doesn't expect any employees to be out of a job or any impact on service or programs," he said.

Gagnon added that hiring part-time staff to reduce overtime is good for employees as well as the budget.

"Asking our staff to work that many hours really takes its toll on them," he said. "With more part-time staff everyone wins."

The full text of a media release from SAH on its fiscal recovery plan follows:

************************* May 14, 2008 - Sault Area Hospital's (SAH) board of directors has approved an improvement plan to help improve the hospital's financial picture.

SAH has identified $6.9 million annually in improvements once the plan is fully implemented.

The plan is a collaborative effort and identifies a series of revenue generation opportunities and operating efficiencies.

"Our improvement plan was developed with input from physicians, staff and managers, and by using benchmard data from peer hospitals and financial targets," says Ron Gagnon, president and chief executive officer. "We're pleased at the significant progress that has been made to date. although we recognize that much work remains ahead of us."

SAH does not expect employees to be out of a job or major impacts on programs or services.

"In fact we predict the need for more part-time nurses in the future as a result of staffing schedule changes," says Gagnon.

The hospital also anticipates that some staff may move positions through out the hospial and that any downsizing of staff will be managed through attrition.

In addition to the improvement plan, the board approved a process that will further analyze hospital operations.

"SAH and the North East Local Health Integration Network (NE LHIN) have agreed to work collaboratively to undertake an in-depth analysis of hospital operations," says Gagnon. "SAH will strike a steering committee by this summer which will consist of representation from SAH, the LHIN and a consultant."

A final report with recommendations is expected by late summer/ early fall 2008.

SAH ended the 2007/2008 fiscal year with a financial shortfall in excess of $12 million.

Even with the progress made through the improvement plan, the hospital continues to project a deficit from operations in excess of $10 million for each 2008/2009 and 2009/2010.

The hospital is required to either submit a balanced budget to the LHIN, or a plan to achieve a financially balanced position within two years.

"Given the current and projected financial results, it is clear that a thorough review, as well as new and innovative ways of delivering hospital services is required," says Gagnon. "By getting SAH back on stable financial footing, we help to ensure that quality care continues to be available for our patients."

"I would like to extend my thanks to all staff and physicians who have been actively involved in this process since last fall and I look forward to working together on the next phase of our plan." *************************