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Chattanooga: Erlanger cuts 200 jobs, plans raises for some

By: Emily Bregel
(Contact)

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Jim Brexler

Erlanger hospital officials are trimming burgeoning expenses by eliminating more than 200 jobs in the upcoming fiscal year.

But the hospital’s new budget also sets aside about $2 million for employee raises, primarily for workers who care for patients directly, the hospital’s chief executive officer said Thursday night.

The “market-based” salary adjustments are intended for clinical staff members, such as pharmacists, nurses and respiratory technicians, said Jim Brexler, Erlanger CEO.

“We gotta be competitive,” he said after the hospital’s monthly board meeting Thursday. “You can’t go a whole year (without salary adjustments) and be competitive in the marketplace. ... I can tell you that (salary increases) are not going to happen for management before we can deal with that for employees.”

Although Erlanger will not give across-the board raises at this time, in six months hospital officials will re-evaluate the hospital’s financial situation and consider hospitalwide raises, Mr. Brexler said.

He could not offer any details about how many employees might be able to receive a raise from the $2 million set aside in the hospital’s new fiscal year 2009 budget, which was unanimously approved by the hospital’s board of trustees Thursday night.

In discussing the job cuts, which will save the hospital $10 million in annual payroll expenses, Mr. Brexler acknowledged to board trustees widespread rumors of job cuts that had circulated among employees this week.

“The fear factor and concerns (among) all our employees is out there, and that’s a natural thing,” he said during the meeting. “I felt like the best way to do it was to address that issue very straightforwardly.”

Erlanger officials said that a minimal number of employees — perhaps 20 — will lose their job. Many of the 200 employees whose positions are being eliminated will be reassigned to other areas in the hospital, officials said.

“We are truly attempting to mitigate any impact to individuals,” said Gregg Gentry, senior vice president, after the board meeting. “We have very talented, good employees, and we are attempting to reallocate them to where the needs of our operations would warrant their talents.”

The hospital has made efforts to reduce overtime expenses and has held off on new hires whenever possible so that experienced workers at Erlanger might be able to move into those positions if their job is cut, hospital officials said.

During the meeting, board trustee Ron Loving said, “I appreciate the fact ... that we’re looking at every possible alternative, like overtime reduction and contract labor (reductions), before we get down to any impact on employees.”

Mr. Brexler emphasized that the job cuts will not affect quality of care and will affect mostly management-level jobs, not positions critical to patient care.

“One way or another we’ve got to adjust our expense pattern to match the revenue streams, and that frankly is the situation we’re in,” he said.

Erlanger has had a tough fiscal year, with uncompensated care losses increasing to almost $82 million this year, from about $75 million in the year prior. Uncompensated care includes losses from patients with TennCare — the state’s managed Medicaid program — and free care given to uninsured patients, as well as bad debt.

The hospital’s board supports the administration’s difficult decision to cut jobs, trustee Jim Worthington said after the meeting.

“I hope our employees understand,” he said. “The administration and the board of trustees are in agreement. We want to do everything we can to help (the employees), but we have to be reasonable.”

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