One factor, over others, kills hospital
Published 1:30 am Thursday, April 3, 2008
Ernest Hemingway once wrote, “Retirement is the ugliest word in the language.”
His comment is right on the money and hits close to home for a troubled Natchez hospital.
One of the deepest, darkest financial wounds Natchez Regional has involves something that sounds so innocuous — the retirement plan.
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Many years ago, Natchez Regional’s board chose to participate in the Public Employee’s Retirement System of Mississippi. Yes, this is the same one in which almost all non-federal government workers participate.
And, quite frankly, it kills Natchez Regional.
The amount of cash hemorrhaging from Natchez Regional and straight into the PERS system is staggering.
Hospital board members estimate an average payroll — prior to recent 5-percent across-the-board pay cuts — is $600,000. Since Regional pays every two weeks, that means each year, the hospital’s payroll is approximately $15.6 million.
Regional’s participation into PERS means that currently the hospital must pony up just fewer than 12 percent of that number to fund the flush retirement system. That’s approximately $1.8 million a year.
We may be way off base here, but we believe few, if any, other local businesses would pay close to that amount.
PERS is a powerful group in the state of Mississippi. If you had $21.9 billion in the bank — that’s the amount its 2007 audit shows — you’d be powerful, too.
We hope the hospital board will push hard to get out from under the PERS blanket and that PERS will find it in their hearts to let the hospital loose.
As much as it may anger employees to be weaned off the system, it’s one of several factors that is killing the hospital. Something has to give soon and we hope it’s the lucrative, cash devouring sacred cow known as PERS.