Loudoun Healthcare Inc. laid off 50 employees last week, part of what interim chief executive Joseph A. Ruffolo described Thursday as a new operations plan developed to cut costs, create better run departments and enhance revenue.
The 50 layoffs came from all areas of Loudoun Hospital Center and included several nurses in supervisory positions. Ruffolo said no nurses who work directly with patients were affected. An additional 19 people will lose their jobs Oct. 1 with the closing of the outpatient counseling center.
Ruffolo said the hospital also has cut the hours of some part-time and full-time staff and has not replaced some of the staff members who have left over the last couple of months. The hospital expects to save $7 million in labor-related costs for fiscal year 2000, which began in July.
The plan, approved by the board of directors Wednesday night, is an attempt to infuse the hospital with $17 million--through cost cutting and added revenue--to stabilize the organization, which had about $20 million in losses over the last two years.
Hospital officials said the layoffs came after several staff task forces made recommendations of services and tasks that could be consolidated. Among the laid-off employees were administrative and support staff members in several departments. For example, Loudoun Healthcare's physical therapy center in Purcellville will be moved into its urgent care center there, resulting in the loss of clerical and other positions.
Other cost-cutting measures include reducing consulting costs by $4.7 million, reducing supply costs by $1.6 million and consolidating some services and departments. However, "we are not closing any major services," Ruffolo told reporters Thursday.
Ruffolo also outlined how he hopes to increase hospital revenue.
He said the hospital will continue to maintain its Cornwall Street campus in Leesburg, calling it a "natural place" for expanded long-term and transitional care. He noted that an earlier proposal to turn the center into a facility for seniors is still on the table. The campus has cost $1 million a year to operate--with long-term care, transitional care and the counseling center--and has lost $3.3 million since fiscal 1996.
He also said efforts would be made to discharge patients more quickly when possible. "Our house is always full," he said, adding that many patients do not need to be there and are merely "tying up a bed" that could be used for those in need of urgent care.
Once the hospital's financial situation improves, Ruffolo said, he will examine ways to expand the organization's capacity to keep up with Loudoun County's growing population. In the last two years, inpatient volume has increased 25 percent, outpatient 20 percent to 25 percent.
Ruffolo said hospital management will review accounting and collection procedures, areas that have been weak in the past, according to past audits. A 1998 audit showed that Loudoun Healthcare lost $9 million that year, some of which was a result of a backlog in unbilled patient accounts in the long-term care center. Since then, hospital officials have said some of the problems have been solved through automation.
Other efforts to increase revenue will come from renegotiating managed care contracts--the hospital is currently negotiating with seven or eight companies--and increasing long-term care rates.
"The plan is not without some pain," Ruffolo said. The plan affects the entire Loudoun Healthcare system, he said, including hospital-owned physician practices who are, "sharing the pain equally."
Staff writer Dana Hedgpeth contributed to this report.