BURLINGTON — Salaries will be reduced for approximately 300 of the highest paid employees of the University of Vermont Health Network, the network announced on Friday.
The reductions are part of an overall plan to address a projected fiscal year loss projected at $152 million.
Directors will received a 5 percent cut in base pay. Vice presidents and above will receive a 10 percent cut.
The network is also instituting a hiring freeze, a freeze on capital spending, and eliminating employer retirement benefit contributions for leaders (roughly 300 employees). In March, the network eliminated performance bonuses for physicians and leaders in the current fiscal year.
“COVID-19 forced us to completely change how we deliver care in a matter of days. I am immensely proud of our people and their response to this pandemic to provide the best care for our patients,” said John Brumsted, MD, President and CEO of the UVM Health Network. “Now we must confront the harsh financial realities that this situation has had on our organization, which means terribly difficult decisions that have a direct impact on our co-workers and their families. The UVM Health Network is prepared to do whatever it takes to preserve access to the care our communities need and depend on. We will get through this by taking action now to mitigate the long-term impacts of our financial challenges.”
The network entered the current crisis with revenue down $14.6 million from projections. As the COVID-19 pandemic made its way into Vermont and Northern New York, the Network instituted a number of initiatives to reduce the spread of the virus, protect and support our patients and staff, and safeguard our supplies and protective equipment, including:
· Temporary cancellation of non-time-sensitive procedures and appointments since March 17;
· Creation of stand-up COVID-19 units and temporary testing facilities;
· Significant work to increase telehealth services;
· Suspension of collections-related activities on patients’ past-due accounts;
· Issuance of an extra week’s pay for employees earning under $99,000 per year.
The total of these expenses through the end of April 2020 is estimated to be upwards of $20 million, with new costs being added each day. A compounding issue is the steep drop in non-COVID-19 patient care, resulting in less patient service revenue, estimated to be as high as 50 percent. March 2020 saw a $44 million loss.
This loss is lessened by $37.9 million in federal government funding that has come to the UVM Health Network.
The actions mentioned above are expected to save the network $25 million. In a statement issued Friday, the network said additional steps will be taken as needed.
Once it is again able to perform non-time-sensitive procedures and appointments,the network said it may be able to make up some ground. The network is working now to put all necessary measures in place to ensure the safety of patients, providers and staff, as services resume.
Additionally, financial support from state and federal governments is essential to offset the financial toll, the network said.
“We are fortunate that our public leaders at every level are making bold, tough decisions. Their support and partnership with our Network have been invaluable throughout the pandemic. I am confident that as we begin to open up services and address the financial damage, they will continue to provide the support we and other health care providers need right now and in the months ahead,” Brumsted said.
The network’s announcement came the day after Notthwestern Medical Center (NMC) in St. Albans announced it would be asking staff to accept voluntary layoffs and making other reductions in spending.
Ohter steps taken by NMC included staff reductions at RiseVT and a $400,000 cut to the program’s budget, elimnination of a project to relocate the lifestyle medicine program to downtown St. Albans, and a request to the Green Mountain Care Board for 14,9 percent rate increase.
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May 04, 2020 at 04:33AM
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