By Jeanne Sager
HARRIS November 10, 2006 Administration at Catskill Regional Medical Center finally broke its silence Wednesday afternoon with only bad news to impart.
Since the departure of CEO Arthur Brien in mid-September and the hiring of Chicago, Ill. turnaround firm Navigant, the hospital has been quiet about plans to recover from financial distress.
But Thursday afternoon, the senior member of the hospital’s administration, Vice President and Chief Financial Officer Nick Lanza, spoke with the Democrat.
After weeks of calls to members of both the hospital administration and the board went unanswered, Lanza confirmed rumors that Brien’s successor, former chief operating officer Larry Cafasso, was given his walking papers Nov. 3.
He was followed yesterday by 72 employees, axed from the hospital’s staff in a process the administration has dubbed “rightsizing.”
Lanza said Navigant compared the hospital’s staff to other “efficient healthcare organizations” around the country to determine where CRMC was overstaffed.
Each employee on the 833-member staff was reviewed individually, he said.
Positions were then eliminated entirely, and with it the jobs of 72 non-union staffers.
Lanza said the board of trustees had the ultimate decision based on recommendations by Navigant.
“But the board does not know the names of the people let go,” he cautioned.
The board’s decision came as the hospital learned hundreds of thousands of dollars were being lost each month that the hospital continues to operate.
“What we needed to do was stem the tide of our cash bleed,” Lanza said. “We needed to match our outgoing expenses with our incoming cash flow.”
He estimated that if the cuts were not made, the hospital would not have been able to operate beyond the end of the first quarter of 2007.
Lanza said the next move is up to the board although no further layoffs are anticipated at this time.
“We needed to rightsize the organization to continue providing service to Sullivan County,” he said. “Right now, based on the business we’re seeing, this is it.”
Pressed again to confirm whether layoffs have stopped, Lanza said “it’s a probably.”
“Take any business what do we know what our business cycle is going to be like a year from now?
“For the foreseeable future, we don’t have any cuts.”
They won’t be making any new hires, either, he said.
Navigant will put an interim chief operating officer in place while the search goes on for a new chief operating officer.
Remaining unchanged is the make-up of the hospital’s board of trustees which oversaw the hospital prior to and during the financial crisis.
Former board of trustees president Richard Baum, who took a leave of absence in late September to serve as a liaison between the hospital and Navigant at a $5,500 weekly salary will remain on task through the end of the year.
“But there’s specific time allocations tied to that,” he added. “He can’t just not show up and get paid.
“He needs to work for it.”
Lanza’s decision to speak with the Democrat was the first break in the silence from the hospital since early October.
When the Democrat called Cafasso last week, secretaries said he was on vacation.
Rumors began swirling that he’d returned from vacation only to be let go, but again calls to the hospital went unanswered.
Lanza finally confirmed that Thursday afternoon, saying he will be taking care of business for a short time.
Lanza, chief financial officer for the hospital, left shortly before Brien, only to be rehired by the hospital board when Brien was ousted.
Sources had also named Patty Armstrong, director of the hospital’s nursing staff, among those laid off Wednesday but Lanza said she’s still a member of the staff, albeit with a new title.
A hospital press release said, “Despite rumors to the contrary, it is important to note that no nurses or other direct patient caregivers at the hospital have been impacted.”
That seems to be true sort of.
The hospital layoffs extended beyond the walls of its facilities in Harris and Callicoon into its clinics.
“They did fire nurses, that’s a big fat lie,” said one nurse, who asked not to be identified because the two weeks’ severance pay provided by the hospital was contingent on people not “defaming” the hospital.
The licensed practical nurse said that among the papers handed out by the hospital in its severance package was a list of employees let go from the physician’s offices.
That list included five licensed practical nurses, two registered nurses and one certified nurse midwife a total of eight members of the nursing staff let go.
Lanza confirmed the axing of the midwife, but said the number eight seemed “awfully high.”
He declined to comment on the licensed practical nurses and registered nurses fired, saying he wasn’t sure of the exact numbers.
He also hastened to add that patient care has not been affected in any way.
“The proviso right from the beginning was not hampering patient care,” Lanza said.
The nurse who spoke with the Democrat took issue with that statement as well.
The nurses in the physicians’ offices do injections, change dressings, draw blood, coordinate with patient’s specialists, take care of referral services, call in prescriptions to the pharmacies and more, she said.
“Our patients are used to us, they have confidence in us,” she said. “I’m going to miss our patients; I love our patients.”
The nurse pointed the finger of blame back to the top of the pyramid.
“Us who had no control over the money are being punished over lack of money,” the nurse said. “It’s like a teenager with a credit card ‘Oh no, I spent too much, what am I gonna do?’”
The nurse in question, who has one child in college and another currently completing her applications, said the hospital picked a “lousy” time to fire people just six weeks before Christmas.
That list of those fired included receptionists, file clerks, medical assistants and managers.
There were people who’d worked for the hospital for less than a year and people who’d been working in the doctors’ offices for 14 years.
“It’s just absurd that they could be so cruel and so heartless,” the nurse said.
“They’re trying to build community pride by laying off half the community?” she said. “We’re being punished for their poor management, and we had no control.”
Lanza said the decision were about business.
Each employee was given a severance package and the chance to speak with representatives of Sullivan County Workforce Development.
A job fair has already been scheduled for Dec. 1 with representatives from neighboring healthcare facilities including Crystal Run expected to be on hand.
Wednesday’s cuts came on the heels of the departure of Crystal Run Healthcare’s medical staff in June, costing the hospital thousands in patient admissions, and a Department of Health investigation into healthcare concerns prompted by Crystal Run that revealed the hospital failed to comply with the state hospital code on four separate occasions.
They also follow the layoffs of Chief Compliance Officer Mark Mendelsohn, Director of Physician Recruitment Linda Kaempf as well as the resignation of board member Dr. Martin Handler (which happened in September, shortly before Brien’s ouster).
Now it’s time to look to the future, Lanza said.
“There were two aspects of this review,” he said. “The first is to survive… now we need to go into the planning stage of thriving.
“That’s going to be a longer process, but if we didn’t do what we did yesterday, we wouldn’t be able to plan for the future.”