YKHC lays off workers, cuts programs

by Angela Denning-Barnes on September 27, 2013

Gene Peltola Sr. (right) stands with Karla Romero Erlanson and Dan Winkelman.

Gene Peltola Sr. (right) stands with Karla Romero Erlanson and Dan Winkelman.

Sequestration federal funding cuts are across the board unless an exemption is made by Congress. The Indian Health Service has not been exempted and non-profit corporations all over the state, like the Yukon Kuskokwim Health Corporation based in Bethel, are feeling the hit. YKHC will be seeing $7.7 million in federal funding cuts for fiscal years 2013-14. In response, the corporation is laying off some workers, eliminating other vacancies, and ending some programs.

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At 1,600 workers, the Yukon Kuskokwim Health Corporation is the largest employer in the region. Its annual payroll is about $80 million dollars.

The federal cuts that YKHC is experiencing through the sequester breaks down to $4.3 million dollars in FY 2013 and $3.4 million in FY 2014.

The homecare program will also be closed down.

Gene Peltola Sr. is the long-time President and CEO of YKHC.

“We’ll be eliminating the homecare program and waiver program in the villages and in Bethel,” Peltola says. “And one of the reasons why we targeted the homecare program, it was a program that we were losing a considerable amount of money on.”

The homecare program helps families who are caring for needy individuals at home. For example, it allows homecare attendance workers to help elders with cleaning and laundry and dishes.

Peltola says they knew there would be cuts but they didn’t know the exact details until late June. He says that the administration worked with the Finance Department and the board of directors to come up with the cuts.

They also include laying off nearly 50 employees. The layoffs will start October 1st. YKHC has a hiring preference for those workers and HR Director, Karla Romero-Erlanson says they will work with them to see if they can transfer into one of their 200 current vacancies.

“We’re working, based on qualifications, to see what positions qualified applicants can transfer into,” Romero-Erlanson says.

About half of the 50 layed off workers, at this point, look like they can be transferred.

YKHC is also eliminating 44 positions that were vacant and considered non-essential.

The corporation also eliminated its summer hire program which often employed college students wanting to make seasonal money.

But the health corporation will be spending MORE money in one area: Doctor’s pay. To help fix the increasing problem of keeping physicians, the Board of Directors decided to increase physician salaries by $1.2 million dollars.

Peltola says the scariest part of it all is that it’s a long-term problem. He says unless IHS became exempt by Congress YKHC will lose almost $30 million over the next 10 years.

“So, this is an annual process that we’re going to have to go through to be able to live within our means,” Peltola says.

YKHC has a savings account of approximately $40 million dollars. It’s from the winnings of a lawsuit against the federal government for funding shortfalls over several years. It’s called the YKHC Permanent Fund but Peltola says they won’t be using any of it to get through these tough times.

“Because they’re non-recurring funds to cover recurring expenses within an organization. I mean, you’re just prolonging the problem, if you do,” Peltola says.

Spokesperson for YKHC, Donna Bach, says that patients can help.

“It’s really beneficial to make, schedule, or cancel your appointments on time or in advance because helping with those efficiencies can improve opportunities for people who may need those appointments,” Bach says.

She says people need to understand that there will be challenges in the work force during the sequester environment.

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