The headline reads “Fiscal Challenges Spur Painful Cuts” ("Painful Cuts", 2008, p. 1) the effects of a worsening economy hits home. This was the headline of a recent internal communication bulletin posted at my work, Mercy San Juan Healthcare, one of Sacramento County’s major employers. Along with the state’s fiscal woes, Medi-Cal reimbursement rates (the rates paid to medical providers for services provided to Medi-Cal recipients) were cut 10 %. Working for a hospital that sees a disproportionate number of patients on Medicare and Medi-Cal programs, and a rising increase in the number of patients with no medical insurance, this a major financial blow to a community-based hospital...and to many people who work for Mercy San Juan Healthcare.
According to the California Hospital Association, “California’s community hospitals are increasingly operating in a code blue financial condition. Nearly 50 percent of all hospitals are operating in the red...” (California Hospital Association [CHA], n.d.) The long-term affects of these cuts could mean financial ruin to not only the hospital I work for, but to our state’s hospitals, if immediate action is not taken to preserve their future financial stability.
For me at Mercy San Juan, our management team were aware of the proposed statewide budget cuts since late last year. With the statewide attention and the newspaper headlines it made, staff was cautiously hoping for the best, but realistically preparing for the blow. After an analysis of the first quarter financial statement losses, urgent action was imminent. The management team formed tasks forces to create budget contingency plans reflecting a seven percent reduction. Obvious it ...