Despite the relatively flat hospital employment rate between July 2008 and July 2012, hospitals in Illinois have been putting hundreds of jobs back on the chopping block. Facing budget cuts up of to 40 percent, hospitals are looking at their biggest budget item--labor expenses, the Chicago Tribune reported.
Much of the blame for the job cuts are directed at weak patient admissions and declining reimbursements. However, the industry's shift from fee for service to better quality and efficiency also is motivating hospitals to provide fewer services.
"We're all out there trying to drive inpatient volumes down," Northwest Community Hospital in Arlington Heights, Ill., CEO Bruce Crowther told the newspaper. "When you do that, you've got to reduce costs to match the amount of work you have," he explained.
As Northwest Community Hospital emphasized quality over volume, it also laid off 188 employees this year--and still has to cut another $40 million.
"This is happening all over the country, and the cuts you're seeing now are likely to be the first salvo in what's going to be a very significant reduction in force by hospitals nationwide," according to Chicago-based healthcare consultant Jamie Orlikoff.
While similar cuts take place at hospitals across the United States, the reasons behind them stay the same.
For instance, a drop in patient demand caused California's Community Memorial Health System to lay off 31 employees, while KentuckyOne Health eliminated 40 employees from two of its hospitals. In Arizona, lower Medicaid payments forced Yuma Regional Medical Center to cut 135 jobs, or 6 percent of its workforce.
However, there have been some bright spots in an otherwise bleak employment outlook. Hospitals added more than 8,000 jobs last month, according to new data from the U.S. Bureau of Labor Statistics. Overall, the healthcare sector added 43,500 jobs in September, accounting for more than a third of the 114,000 jobs the U.S. economy added last month, FierceHealthFinance previously reported.
For more:
- read the Tribune article (registration required)