HHC President Alan D. Aviles answers reporters' questions.

Following HHC’s news about the changes expected over the next four years, HHC President Alan Aviles answered questions from the press.  Here are some of the details they discussed.

Reporter: On the workforce reductions -- can you give us a breakdown in terms of attrition versus layoffs and how those layoff decisions are being made? What types of employees will be laid off? 

Aviles: Our plan includes a combination of layoffs and attrition. Because we were able to plan this over four years, we are hopeful that there will be more targeted attrition than we otherwise would have been able to accomplish.  But looking at the first fiscal year, we anticipate that of those 1,000 or so that we will reduce in our workforce, roughly half will be by targeted layoff, and that they will occur later this summer. A majority of those positions will include managers and construction and maintenance personnel.

Reporter: How does the new health care reform law factor into all this?

Aviles: Healthcare reform doesn’t have a significant impact on our system one way or the other for several years – it’s not until 2014 that most of the provisions really begin to become implemented. For HHC, it is something of a mixed bag. On the positive side, we anticipate that some significant number of our uninsured will become eligible for insurance; that’s a potential source of additional revenue. On the negative side, part of healthcare reform will involve reducing the amount of federal disproportionate share funding that supports public hospitals and other safety net systems. So, it remains to be seen how much of that take-down of disproportionate share funding actually impacts HHC.

Reporter: Have the affiliates agreed to the 6 percent reduction in their contact agreements or are you just cutting the number of physicians?

Aviles: There has been no agreement at this point with any of the affiliates, which include medical schools and large physician professional corporations. We have begun discussions and negotiations. And we hope there will be cooperation.  However, if that is unsuccessful, then we will look to take more unilateral action to achieve those reductions or those savings.

Reporter: So, you’re hoping to get the same amount of services for 6 percent less?

Alan Aviles: Yes. Part of the restructuring work included a detailed analysis of work load and patient volume across various specialties.  This analysis shows that there is an imbalance, meaning that there isn’t as much volume as one would expect in some of those specialty areas for the number of physicians covered under the affiliation contract services that we purchase. And so, we do believe that there is room for a reduction in physician resources without negatively-impacting capacity.

Reporter: Could you be a little more specific about those doctor numbers?

Alan Aviles: I can’t give you a precise number. There are a lot of variables here built into the affiliation contracts.  Those costs include physicians, as well as allied health professional services, and some administrative services. So, some of that reduction could be taken in other than physician workforce. And also, it would depend upon the mix of specialties; there can be a lot of variation between the compensation of two physicians depending upon specialty.

Reporter: Metropolitan Hospital is three or four blocks from Mount Sinai and in the past has been considered for closing. Why not close it down?

Alan Aviles: We did a very complex analysis to understand the impact of closing a small hospital like Metropolitan.  And the result was simple: it doesn’t pay off.  It doesn’t pay off financially.  And it certainly doesn’t pay off when you factor in the devastating impact it would have on our mission. The truth is that even our small hospitals fill a critically important healthcare gap in the communities they serve.  Take North Central Bronx -- despite the fact that they’re around the corner from the emergency department at Montefiore, they served 60,000 patients last year.  And although it’s a relatively small in-patient hospital, it provides, among other things, in-patient psychiatric services where there is no room at the inn anywhere across the city. So, the balance between mission and what you get from closing an acute care hospital in terms of cost-effectiveness is just not remotely there.

May 2010