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Hospital Chiefs: Cut Costs with Care

John Commins, for HealthLeaders Media, February 8, 2013

Chris D. Van Gorder
President and CEO
Scripps Health
San Diego

On budget cuts in a changing landscape: It's hard to know how much needs to be pulled out of operating budgets yet, and it will be an issue dictated by federal, state, and local reimbursement cuts and competitive issues. I think many organizations will need to reduce their operating budgets between 10% and 20%—some maybe even more.

On the need for transparency:  It's important to be open and transparent with employees about these issues and to engage them in the process of reducing costs. It's also critical that physicians be engaged in the process with management. Everyone wants a successful organization and wants to continue the mission so it's critical to engage everyone in the process. We have to do everything we can to protect jobs right now. 

Why would any employee help to reduce costs or engage in the process if that means they will lose their own job?

On morale and displaced employees:  We place any employee impacted by a position elimination into a career resource center. While we can't always promise the same job or the same work location, we can help an impacted employee find another position in the organization. The key to maintaining employee morale is to do everything we can to retain jobs while we design new work processes that will be more efficient, eliminate waste in operations, and restrain hiring so we have positions in which to place loyal Scripps employees who have their jobs impacted by these changes.

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4 comments on "Hospital Chiefs: Cut Costs with Care"


Frank (2/23/2013 at 1:52 PM)
Isn't it better to push for higher taxes and premiums rather than cut spending in vital areas?

ERASTOTHENES DE ALEJANDRIA (2/22/2013 at 12:53 PM)
Any type of effective management requires the participation of all members of the Organization, making all them responsible for the success that management and results. The remuneration of employees should be adjusted to the work done and achieved savings. Only when the employee see that his effort is rewarded, it will continue in that effort.

ERB (2/13/2013 at 1:24 AM)
Start cutting the force flu vaccine! Between the cost and ALL the advertizing trying conveince us the are needed{LOL} and r for patient safey{LOL} they could use the $ on something that is really needed