Outsourcing could cut 6 AVH jobs | AspenTimes.com

Outsourcing could cut 6 AVH jobs

Eben Harrell

As many as six downvalley employees of Aspen Valley Hospital will likely lose their jobs this holiday season as the hospital prepares to hand over much of its troubled billing operations to an outsourcing company.Hospital officials said the agreement will be “groundbreaking” and all but guarantee improvement at the financially struggling institution. At a meeting of the hospital board of trustees on Monday, board members announced that the hospital is potentially days away from completing nearly seven months of negotiations with First Consulting Group (FCG), an outsourcing firm based in California.A team of high-level executives from First Consulting Group will visit Aspen this week and likely approve a five-year, $13.5 million contract to take over operations at AVH’s billing and collection department. The agreement is pending the approval of newly appointed Chief Financial Officer Terry Collins, who arrived at AVH this week.The billing department, which was based for years in Rifle but moved to Carbondale this fall, was the epicenter of a recent financial crisis resulting from millions of dollars of tardy or uncollected hospital bills. The billing office has about 36 employees. Around 30 will be hired by FCG at a comparable salary and benefit level to their employment agreements with AVH, according to hospital CEO David Ressler. Five or six of the employees will be laid off, possibly by Jan. 1, although nothing has been finalized.That number is much lower than many hospital employees feared after negotiations with FCG were announced in August. The announcement came as the hospital was still reeling from a surprise reduction of 10 percent of its work force – some 34 employees – three months earlier.”We are trying to speak honestly about this so no one is surprised. But the details are still being worked out. We don’t yet know for sure who will be impacted,” Ressler said.A hospital’s financial health, in essence, is only as good as its billing and collection practices – sending out and collecting bills timely and effectively is a key determiner of success.The contract with FCG will stipulate annual minimum performance levels that FCG must meet. Ressler said these indicators will set a level higher than what AVH could reach on its own.”The contractual objectives set a higher target than we can accomplish with our current resources. That’s the bottom line,” Ressler said.”We’ll see a significant improvement in technology, service, and accountability for a fraction of the cost of doing it correctly ourselves,” AVH treasurer John Jellinek said.At Monday’s board meeting, an unidentified hospital employee raised concerns about FCG’s pedigree, claiming that the firm has never undertaken a project of this scope.”I have a lot of respect for FCG, but I’m worried about a lack of experience in taking over a whole [billing] operation like this,” the employee, who left shortly thereafter, said. “They’ve never done something like this before.”Board members defended FCG’s reputation but admitted that this would be a new venture for the firm. The hospital needs to adopt novel solutions to its billing practices, according to board President John Sarpa.”Yes, we are breaking new ground,” Sarpa said. “But we need to break new ground. This agreement comes after seven months of intense negotiations. We’ve done our due diligence.”Eben Harrell’s e-mail address is eharrell@aspentimes.com


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