Bartlett Regional Hospital Announces Cost Reduction Plan to Address Operational Expenses and Prepare for Long-Term Sustainability
Contact: Erin Hardin
Bartlett Regional Hospital (Bartlett) is undertaking a phased plan of action to proactively address financial pressures, strategically realign services with community needs, and prepare the organization for long-term sustainability. Bartlett expects these actions will result in annualized savings of approximately $12 million and will enable the organization to strengthen core services and protect future growth plans.
Hospitals and health systems across the country are facing significant financial pressures as they emerge from the COVID-19 pandemic. Much of this pressure can be attributed to inflation and labor shortages, which remain an issue. Over the last few years, Bartlett added many new positions and services to help grapple with the challenges the hospital and the community at-large faced during the pandemic. Temporary federal COVID funding is now gone, and competition is present and organizational expenditures remain high.
“To address our current financial realities and the pressures facing hospitals nationwide, we are enacting critical plans to protect Bartlett’s long-term sustainability and growth,” said David Keith, Chief Executive Officer. “Let me be clear – this is not about a mass layoff of nurses and critical clinical employees - this phased action plan is expected to support our operations and secure our days cash on hand for strategic investments to help grow revenue.”
Bartlett is expecting a $10 million loss this fiscal year and anticipates increased expenses of at least $2 million next fiscal year. The organization is implementing a three-phase action plan to begin the new fiscal year on July 1 without a deficit.
Bartlett’s phased plan of action includes the following highlights:
- Phase 1 (In Progress as of November 2022): Hiring restrictions and reductions in discretionary spending, overtime, purchasing, and travel
- Phase 2 (In Progress as of January 2023): Cancellation of employee incentive pay, implementation of retirement incentive, unit staffing levels and productivity changes, and reductions in temporary staffing
- Phase 3 (Subject to Board Approval in March 2023): Streamlining leadership, targeted reduction in workforce, program eliminations, and strategic initiative delays
“These streamlining and cost reduction actions, while difficult, are necessary to address the challenging operating landscape and better position Bartlett to provide leadership in care and strengthen our core community services,” said Sam Muse, Chief Financial Officer.
“This community has sustained the hospital’s health care services continuously since 1886 and I am proud of its longstanding history in Juneau and Southeast Alaska,” said Kenny Solomon-Gross, Board President. “We remain committed to our mission and our community to provide high quality, patient-centered care in a sustainable manner. The last thing I want to happen is to lay off anyone in our community – it’s so important to the board that we find a place in the organization for our community neighbors.”