Hospital board cuts raises and raises fees in effort to balance budget
In an effort to balance next year’s budget, the Petersburg Medical Center Board voted Tuesday to increase patient fees and reduce employee raise
Inpatient and long-term care patients will see a 3 percent cost increase and outpatients will pay 5 percent more.
Most PMC employees are typically given yearly 2 percent wage increases, similar to a cost of living increase, and an annual ‘step’ raise of 2.7 percent.
The board-approved budget reduces the wage increase to 1 percent and eliminates raises.
Employee salaries, wages and benefits account for 67 percent of PMC’s operating expenses.
PMC CEO Liz Woodyard cited increased healthcare costs and regulations coupled with decreasing reimbursements as reasons for the tight financial times.
“We don’t want to do this forever because it’s a huge burden for each individual taking that cut, but for now we’re in it together and we really want to balance the budget,” Woodyard said. “We’re being very conservative. The board will look at it every quarter and will make adjustments as we need. A budget should be fluid and flexible. It’s a guideline.”
The board struggled Tuesday night over nine separate budget proposals. Board member Darlene Whitethorn made a motion to add a 1 percent step increase, which would increase overall compensation by 2 percent, but the motion wasn’t seconded because it only left roughly $48,000 to work with as opposed to $167,000 without the one percent step increase. Two looming financial mysteries the board has to consider are potential increases to the Public Employee Retirement System (PERS) that public employers pay and the rising cost of health insurance. The majority of the board wasn’t comfortable with leaving that amount of money in anticipation of those increases.
“It’s not because we don’t want to, it’s because the numbers are not there,” board member Rocio Tejera said. “The step’s a great thing. And I know the price of milk has increased by more than 1 percent, it’s probably increased by more than 2.7 percent, absolutely. But can we really afford to do that?”
Board member Kris Kissinger asked PMC department heads about a different bottom line regarding how lower paid PMC staff would be affected.
“If they don’t get a step, what would that mean?” Kissinger asked. “Would they quit? Would they just be upset? What does it mean in terms of their living. Is it a matter of buying groceries?”
“Some of our staff deal with that every two weeks,” said Jennifer Bryner, Director of Nursing. “That’s the nature of that level of work. We’ve got lots of people that have second and third jobs to make ends meet. I don’t think anybody’s going to up and quit but I think the loyalty kind of goes. There’s no easy answer.”
PMC Lab and Imaging Manager Liz Bacom ultimately jumped in and encouraged the board to make the tough decision and said it’s wiser to be conservative now as they wait to see which costs will rise.
“… put that in your motion that it (the budget) will be evaluated after you find out about the status of the PERS and the insurance and maybe you can be a little more generous or maybe not,” Bacom said. “I’m thinking as a board member that if you try to be more generous now and find out you’re going to be resenting that in two months then you’re going to be asking staff to do something even more drastic.”
The board will reevaluate employee compensation mechanisms when the State budget is approved by the legislature and on a quarterly basis.
PMC employs 87 full-time staff and 11 part-time.
“We’re committed to providing excellent patient care,” Woodyard said. “That’s our number one goal.”
*A story on PMC’s full budget will appear in a future edition of the Petersburg Pilot.