'We're going to use this to become streamlined,' Erlanger CEO Will Jackson says in board address after layoffs

Staff file photo by Robin Rudd / CEO of Erlanger Health System Dr. Will Jackson
Staff file photo by Robin Rudd / CEO of Erlanger Health System Dr. Will Jackson

Dr. Will Jackson, CEO of Erlanger Health System, addressed the hospital's board of trustees with a solemn tone Thursday evening after eliminating and restructuring 30 management positions on Monday.

Jackson spoke for roughly three minutes during the trustees' regularly scheduled monthly meeting, and he said the week has been tough for Erlanger and all involved. He thanked the human resources team and other associates for maintaining their professionalism and keeping their focus on Erlanger.

He did not provide any new details as to what departments and levels of management were impacted by the restructuring. Individuals close to several employees who were laid off told the Times Free Press that the layoffs include members of upper management. It's also unclear how many people were laid off and how many moved into new positions. Jackson said leadership has tried to be respectful to those affected. However, Erlanger spokeswoman Pat Charles said no clinical staff, including doctors and nurses, were affected by the layoffs.

"This week is not going to be in vain. We're going to use this to become streamlined and lean, and we're going to make the organization better over time," Jackson said, adding that he would withhold any further public comment on the restructuring.

Trustees directed Jackson to reorganize Erlanger's management structure when they finalized his CEO contract at their September meeting. Monday's announcement revealed Erlanger's need to control costs and improve efficiency after a nearly $9 million financial loss in six months.

Jackson went on to say Thursday that Erlanger achieved its certification in recognition of excellent patient care and outcomes for primary hip, knee and ankle replacement. He also commended Erlanger East Hospital for again being voted the region's best place to have a baby.

The board also passed a resolution approving a physician practice plan between the Erlanger Medical Group and the University of Tennessee College of Medicine, which has an affiliation with Erlanger to train medical students and residents. The move creates a new method of reimbursement where clinical services will be provided through Erlanger Medical Group - which employs about 425 to 450 physicians and advanced practice providers - and paid for by Erlanger. All academic services will be provided through the University of Tennessee and paid for by the university.

Dr. Bruce Shack, dean of the UT College of Medicine Chattanooga, said the plan has been years in the making, and it will be better for both Erlanger and the University of Tennessee College of Medicine.

"It gets everything in the 'right bucket,' as Chancellor [Steve] Schwab likes to say," Shack said. "I think it'll be a good move. It's budget neutral - doesn't cost Erlanger any more money, doesn't cost the University of Tennessee any more money."

The move also bars UT and Erlanger employees from developing or participating in another practice group within Erlanger's service area. The only exceptions are for preexisting relationships in surgery, plastic surgery and obstetrics and gynecology.

Trustee Steve Angle, chancellor of the University of Tennessee at Chattanooga, did not attend Thursday's meeting but asked to note that he abstained from voting due to a conflict of interest. Dr. Phil Burns, a trustee and chairman of the Department of Surgery at the University of Tennessee College of Medicine Chattanooga, also abstained from the vote.

This month, Burns will receive the American College of Surgeons' Distinguished Service Award - the group's highest honor. He will also be recognized by the University of Tennessee for his contributions to medical education.

Contact Elizabeth Fite at efite@timesfreepress.com or 423-757-6673.