FARMINGTON — Franklin Community Health Network will eliminate 40 full-time positions and reduce some operations in an effort to end a string of losses.

Since July 1, 2011, FCHN has lost more than $15 million. If it had not been for some one-time federal money, the losses would have topped $20 million during that time, according to Timothy Churchill, interim CEO of Franklin Community Health Network.

A number of factors have conspired to create a structural deficit in Franklin’s budget, Churchill said. Significant among them are reimbursements from the federal government for Medicare and Medicaid services that do not cover the full cost of providing that care in a rural setting. Also, the failure of the state of Maine to expand Medicaid under the federal Affordable Care Act has hurt the hospital’s finances.

The board of directors of FCHN approved a plan that eliminates the equivalent of about 40 full-time positions by not filling vacant positions, reducing hours for some employees and through layoffs, affecting approximately 22 individuals. Prior to the announcement, FCHN employed 557.

The initiative also aligns some facilities to patient need. These include reducing the number of active operating rooms from three to two and reducing the number of beds in the intensive care unit from five to two.

There will be no reduction in services offered to patients at the organization’s Farmington campus, and FCHN will continue to invest in its Livermore Falls practices.

However, Churchill said FCHN needed to take advantage of some internal efficiencies in order to stem the losses. For example, the three operating rooms at FMH have run at about 60 percent capacity. Two rooms will accommodate that volume. 

Other steps planned to achieve savings across the FCHN system include:

• Administrative functions at FCHN’s NorthStar Ambulance operation will be reduced, but no reduction in coverage or service is expected.

• Emergency Department use is down slightly at Franklin Memorial — about 5 percent over four years — and staffing will be adjusted accordingly.

•  The FCHN radiology office in Rangeley will be consolidated with the radiology service on the FCHN campus in Farmington. A separate radiology service in Rangeley has become impractical, with fewer than four X-ray procedures each week on average in recent years.

• While FCHN expects to continue investing in its Livermore Falls location, some physician practices on the Farmington campus will be consolidated into more efficient locations. 

• The FCHN board approved a wage and salary freeze for FCHN employees for this year. They also authorized temporary reductions in paid time off and retirement benefits across the board. These measures saved the equivalent of 25 full-time jobs within the organization.

FCHN’s board is working with MaineHealth leadership to create a strategic vision for the organization. 

A robust primary care system — one that treats the whole patient in what the industry calls “patient-centered medical homes” — will be at the heart of any vision for FCHN. Churchill believes other strong opportunities exist for the organization in orthopedics, cardiology, women’s and maternity care and general surgery services.

“Our goal in this process has been to keep patients first while putting FCHN on a sustainable path for the future,” Churchill said. “FCHN has a bright future, but to realize that future, we’ve got to put these structural financial challenges behind us and build on our solid foundation.”

Like many health care organizations in Maine and nationwide, FCHN partnered with a larger organization in 2014. FCHN is a member of MaineHealth, the state’s largest health care system.

MaineHealth will continue to leverage its system resources on FCHN’s behalf, Churchill said, noting that MaineHealth’s NorDx labs will soon partner with FCHN to bring the same level of lab services to patients at lower costs.

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