I recently wrote about the economy and its affects on our organization. Over the past week I have hosted several town-hall meetings with our team members and plan on hosting several more this week. I have been overwhelmed (in a good way) with the amount of suggestions, support, and engagement of our team in stepping up to the plate to help us find new and innovative ways to deal with the economic pressures and realities that all businesses are facing today. To date, I have received dozens of emails, notes, and suggestions on how we can pro-actively deal with improving our operating performance. Together, we will be making a plan based on these suggestions about how to change the way we operate going forward.
I feel fortunate to have such a wonderful team of people to work with as I know our success will be tied to our level of commitment and support of each other. Below is the update letter that I sent out to our team this morning, I welcome your thoughts and feedback!Dear Jewish Hospital and Frazier Rehab Team Members,
I recently wrote to you about the status of the economy and its resulting effects on our system. I am very pleased and encouraged with the responses I have been getting from each of you with ideas on how we can weather this storm as a team. For all of you that have submitted your ideas, they have not been forgotten! I am working on compiling all of your suggestions into a document that I can share and utilize as we put our final touches on the final plan that we will implement.
As I work to compile the results of your feedback, I want to take a moment to share more detail about some of the actions that have already been taken to proactively deal with our situation. As we have discussed, the majority of dollars we spend are related to staff and supplies. Together, these two areas account for approximately 70% of our spending. As we budgeted and planned for 2009, we assumed that we would experience higher patient volumes the first quarter of the year as we have seen in previous years. This was not the case and therefore we find ourselves overstaffed for the number of patients we have to care for. We have no choice but to flex our staffing in order to stabilize the hospital around our operating volumes.
Over the past eight weeks, we have already begun to make changes to help lessen the overall impact to our team. Below are some examples of how we are trying to proactively manage this situation.
· Replacement positions: Each month we lose about 1.2% of our team members to attrition (retirement, relocation, or moves to another job or position). In an organization of our size, this means that we lose 35 - 45 people each month from the hospital. To help with overstaffing, we have greatly slowed down the re-hiring process in areas where our volumes are tracking below budget. Every position that is vacated is closely questioned and asked whether or not that position is vital to patient care and whether the position should be posted and re-hired. The less people we hire means the less people affected by potential downsizing, DTO, etc.
· New positions: Newly created positions that were budgeted for, but have not already been filled, were removed from the open positions report. New positions will only be filled as needed to justify patient care, increases in volume, or other special needs to the organization.
· Daily staffing: Daily productivity meetings are being held with the executive and management team to ensure each unit or department is staffing to volume and to ensure we have the appropriate number of team members in the right place, at the right time. Departments that are already over their daily targets will not have positions approved to be refilled until there is a clear plan in place to address the variance.
· Overtime: Overtime hours are being closely monitored. Overtime will be reduced as much as possible for areas whose volumes or work loads are declining and may be increased in areas where we are delaying the refilling of positions.
· Supplies: While we cannot cut back on the level of care or the supplies we use to take care of our patients, we all know that there are pockets of opportunity that lie throughout our hospitals to improve efficiency and thereby reduce our costs. Great improvements have been achieved in terms of reducing overall patient length-of-stay, but we know that there are additional opportunities to improve the amount of resources we consume. Our supply chain team is working to identify opportunities to improve our pricing, vendor selection and quantity of supplies used to reduce our overall spend in this category. If you know of an area where you believe we are wasting supplies, please bring this to the attention to both myself and your manager.
· Other expenses: I have asked the management team to eliminate discretionary spending wherever possible to help add to our cause (travel, meals, memberships, donations, etc). I know we do not spend a great deal in these areas to begin with, but every little bit helps.
Even with these actions, we are still not projecting to be where we need to be related to our budget and further measures will need to be taken in order to keep us on track. As I mentioned last week, I have begun a series of town-hall meetings and the feedback from the early sessions has been positive. I appreciate everyone’s willingness to help the organization think of new ways to weather the economic storm we find ourselves in while realizing that, in order to do so, we all must be willing to make some personal concessions. If you have not had the opportunity to attend a session, I have added a few new sessions this week. I would encourage you to attend or give me your feedback via email, voicemail, or through my online blog. I will send out an update when the meetings are finished to summarize and highlight some of the key themes that have been suggested.
I know this is difficult news to deal with, but I am very confident that we will be successful based upon the feedback I have been getting thus far. During this time, I am asking each of you to recommit yourselves to the difficult tasks ahead of us while realizing that none of our current obligations change. We must continue to uphold the highest standards around quality and safety. We also cannot lose focus on providing excellent service to our patients and physicians. If we can enhance the level of quality and service we provide, I am convinced we can grow our patient volumes and organization even in these difficult times. Thank you for your continued support.
Sincerely,
Martin J. Bonick
President & CEO
Jewish Hospital & Frazier Rehab Institute

Update on our economic discussions