Officials at Erlanger Health System are plainly serious when they talk about cutting costs to improve the hospital's troubled finances. Unfortunately, they don't have much choice but to cut.
In the first seven months of this fiscal year, Erlanger lost about $12.5 million. That was largely the result of a reduced number of surgeries. The public hospital is not expected to start making money again until April.
That has prompted Erlanger to take significant but regrettably necessary cost-cutting steps.
In January, Erlanger announced it was cutting two-fifths of its executives to save approximately $1.5 million.
Now Erlanger has said it anticipates cutting as many as 30 management jobs by the end of March. Those reductions come to nearly a quarter of mid-level management positions at the hospital, and it is anticipated that the cuts will save an additional $2.5 million per year.
The affected managers, directors and executives are getting severance packages ranging from four months to a year. That provides them some cushion against their job losses.
But in the currently weak economy, low- or high-level employees who are laid off -- whether from Erlanger or anywhere else -- almost certainly are feeling jittery about their prospects for finding that next position.
In addition to the cost-cutting measures above, Erlanger plans to offer voluntary buyouts at the staff level. Depending on how many takers the hospital gets for the voluntary buyouts, some uncertain number of Erlanger's remaining 4,500 workers could face unknown effects from cost-cutting efforts as well.
Erlanger says it will seek not to cut staff in a way that would harm patient care, and we have no doubt it will pursue that goal vigorously and will work to maintain a high standard of care.
But Erlanger, its many employees, its vast number of patients from around the region and all the rest of us would surely be more comfortable if the economy were stronger, revenue were high and there were no need to reduce staff.