
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, August 21, 1993                   TAG: 9308210061
SECTION: VIRGINIA                    PAGE: C-3   EDITION: METRO  
SOURCE: CAROLYN CLICK STAFF WRITER
DATELINE: LOW MOOR                                LENGTH: Medium

ALLEGHANY HOSPITAL CUTTING JOBS

Stung by soaring Medicare costs, Alleghany Regional Hospital will eliminate 38 jobs and close its inpatient psychiatric unit next month, administrator William James said Friday.

James said 24 employees will be laid off and 14 positions will be eliminated through attrition, consolidation and reduced work schedules.

The layoffs will include 14 employees associated with the psychiatric unit who will lose their jobs when the Pavilion shuts down Sept. 30. The remaining 10 layoffs are in positions scattered throughout the hospital.

"We've given everybody six weeks' notice and made arrangements for them to have continuation of some of their benefits through December to help cushion the blow," James said.

After the cutbacks, the hospital will have 45 full-time positions.

As part of the reorganization, the hospital's Graduate Medical Education Program for interns and residents from the West Virginia School of Osteopathic Medicine will close in June 1994.

James said the broad cutbacks were precipitated primarily by reductions in Medicare reimbursement, although he said the shift to outpatient care also contributed to the decision.

There are only two hospitals in Virginia that have a higher percentage of elderly patients, James said. But he said that in July, reimbursements for the government-backed medical program for the elderly "represented only 57 cents on the dollar.

"We had to look long and hard at all the services we provide."

In addition to growing older, the population of the Alleghany Highlands is also dwindling, and that will have an impact on the kind of services the hospital can provide.

James said the board is also concerned about how the rural hospital will compete in a new era of federal health-care reform, with its emphasis on managed competition. Such competition relies on large groups of people and competing physician networks to reduce the cost of health care.

"We're concerned about what is happening in the next three to five [years]," he said.

Memo: ***CORRECTION***

by CNB