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St. Joseph's Hospital Announces Rightsizing Plan

In response to the current economic climate and other market forces facing the healthcare industry, officials at St. Joseph's Hospital announced this morning a rightsizing plan that includes revenue enhancements and cost reductions. The plan, which includes an organizational reassessment utilizing internal and external resources, is a direct result from the current economic climate, Governor David Patterson's proposed New York State budget, and other dynamics impacting the healthcare industry.

As part of its rightsizing plan St. Joseph's will take the following steps:

Collaborating with Guthrie Healthcare System in recruiting physicians to practice at St. Joseph's such as anesthesiology, physical rehabilitation medicine and thoracic surgery. Additional physicians from other specialties should join St. Joseph's Medical staff within the next 60 - 90 days.

Recruiting additional clinical staff members.
Improving methods to increase the hospital's overall efficiency.

Instituting a new physical rehabilitation assessment process resulting in higher patient volumes in St. Joseph's Physical Rehabilitation Department.

Re-evaluating current vendor contracts.

At the same time St. Joseph's will also implement labor and non-labor cost reductions in areas where patient volume has decreased. The elimination of 19 positions at the hospital is expected to enhance the hospital's efficiency without impacting patient care. At this time it is unknown how many employees will be affected by the rightsizing plan until the hospital's seniority based "bumping process" has been completed. Some of the affected employees may accept positions that are currently vacant.

Sister Marie Castagnaro, SSJ, St. Joseph's President/CEO cited several reasons behind today's announcement:
Governor Patterson's proposed 2009-2010 State budget could result in a nearly $2.6 million cut to St. Joseph's 2009 budget.

The number of uninsured or underinsured individuals has increased resulting in higher bad debt/charity care costs. At the end of 2007 St. Joseph's bad debt/charity care stood at $3.7 million. At the end of November of 2008 that number increased by 16% to $4.3 million.

Within the last 9 months health care providers experienced two reimbursement cutbacks from New York State. Sister Castagnaro expects even more bad news. "If the State's deficit continues to grow there's always the chance of additional cuts from the State in 2009," said Sister Castagnaro. "The rightsizing plan we've announced today will allow St. Joseph's to continue its mission of providing quality healthcare at an affordable price. Our high quality programs and services we offer will carry on during these very turbulent times."

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