Houghton: NRMC coping with fund cuts

Published 12:00 am Sunday, July 2, 2000

When Jack Houghton took over the reins at Natchez Regional Medical Center two months ago, he found himself facing the same management woes just about every hospital in America is facing: federal budget cuts.

But those problems weren’t new to the native Texan, who has more than 25 years of experience in hospital management dating back to managing an Army hospital during the Vietnam War. He came to Natchez from Bossier Medical Center in Bossier City, La. Houghton was hired by the private Quorum Health Resources to manage the Adams County-owned Natchez Regional.

One of the biggest problems hospitals still face, Houghton said, is the 1997 Balanced Budget Act, which changed the way hospitals are reimbursed for Medicare patients, giving them less federal money to cover the cost of treating those patients. Medicare is government-subsidized health insurance for some elderly and disabled people.

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&uot;Every hospital in the country is faced with tightening reimbursements from the federal government,&uot; Houghton said. &uot;It has affected the performance of every hospital.&uot;

One of the problems with the BBA is the cuts the federal government intended to make in Medicare ended up being deeper than hospitals planned.

And those hospitals with a &uot;reasonable percentage of Medicare patients&uot; have been affected more than others – and Natchez Regional just happens to be one of them, Houghton said.

&uot;That causes all hospitals to sit down and assess where there’s some room for belt tightening,&uot; Houghton said.

At Natchez Regional, that belt tightening has meant renegotiating contracts, such as a Waste Management renegotiation that saved the hospital between $2,000 and $3,000.

&uot;We’re going through systematically to see if there have been changes&uot; in contracts that will allow similar money-saving measures, Houghton said.

Saving money also means managing staff hours better — especially overtime hours, Houghton said. That’s an important task for a hospital which twice in the past two years had to lay off employees as government cuts got deeper.

But Houghton does not expect the hospital to make any more layoffs.

&uot;The serious staff reduction has been in the past year and a half to two years,&uot; he said. &uot;We’re at a point now where we’re managing staff hours.&uot;

Managing staff hours means tailoring the schedules to the times when patient census is higher, such as during the week. &uot;It simply involves greater flexibility on the part of our staff,&uot;&160;Houghton said.

What Houghton brings to Natchez Regional is experience managing both private and public hospitals — a perspective he said lends itself to managing NRMC with good business sense.

&uot;I use sound business principles and apply those to a public hospital,&uot; he said. &uot;But my approach to management is that I run a community-wide hospital that has a community-wide obligation to provide service and care.&uot;

Houghton doesn’t expect any reversals of the federal funding cuts anytime soon, so he will likely be putting that business sense to good work as the hospital works to serve the community

&uot;The government is looking at some type of a limited relief legislation, but it’s nominal,&uot; Houghton said. &uot;They did not know how deep they were going to cut and they cut much deeper than they intended. Now they have the savings, and they want to appear to help us recover some of our funds, but it’s not going to return to us the difference in what they said they would cut (and what they did cut). They’ve squeezed it out of the system.&uot;