Ascension, the current owner of Evanston’s Saint Francis Hospital, will outsource more than 110 employees at all of its Illinois hospitals, a change effective June 1.
Crain’s Chicago Business broke the news, reporting that staffing changes will affect the health system’s “hospitalist” employees – medical directors, doctors, physician assistants, nurse practitioners and other employees who care for patients during a hospital stay. These employees are essentially being fired and asked to re-apply for the same jobs at Atlanta-based SCP Health staffing firm. Crain’s reported that hospitalists were concerned that SCP Health’s practices, such as requiring doctors to see more patients per day, would hurt the quality of care.
In a statement to the RoundTable, Ascension spokesperson Tim Nelson confirmed that employees would be outsourced but didn’t directly address reported concerns about the impact of the decision.
“We spent many months evaluating potential organizations and feel that our culture and goals are well aligned with SCP Health,” he said. “The goal of this agreement is to continue to deliver safe, high-quality care and an exceptional patient experience with no gaps in service. We continue to work with our hospitalists to make this a smooth transition.”
Nelson didn’t respond to questions about how the change is expected to affect Saint Francis specifically.
Ascension has been struggling financially, ending its last 2022-2023 fiscal year with a $2.7 billion net loss. The system did make a profit during the most recent quarter by cutting expenses, and it benefited from increased admissions.
Hospital staffing agencies have long been used to help staff hospitals during emergencies, but since the late 2010s, hospitals have been increasingly using them for day-to-day staffing. The trend increased during the COVID pandemic. According to its 2022 annual review, Atlanta-based SCP Health provides staffing in more than 400 hospitals and health systems across more than 30 states, employing more than 7,500 clinicians to treat more than 8 million patients.
Warning of risk
The November 2021 High Stakes of Outsourcing in Healthcare study, published by the Mayo Clinic, found that outsourcing staff such as hospitalists can save health systems money and make operations more efficient, but it also warned of significant risks. Those include losing control of quality of care, which would hurt patient satisfaction, hurting employee confidence and losing some flexibility, since the health system has to take staffing contracts into account. Patient records may become more vulnerable to leaks, since they would need to be sent to staffing firms.
The study also warned that savings may not end up as significant as the hospitals initially believe, pointing to “hidden, sometimes ballooning costs” such as the costs of ensuring the staffing firm follows the agreement and even the cost of writing a contract.
“Although a primary goal of outsourcing is cost efficiency, the resulting financials often do not meet expectations, especially if the indirect costs of lower quality are accurately calculated as contributing to poor outcomes such as medical errors, loss of employees’ trust, and increased hospital readmissions,” the study states.
Generally, the study found that outsourcing works best for functions that don’t involve direct interactions with patients.
Since 2015, Toronto-based Onex Corporation investment firm had an undisclosed majority stake in SCP Health. Crain’s reported that the involvement of a private equity firm, which focuses on getting a return on investment, is a major concern. According to Crain’s, SCP Health is reportedly looking to increase hospitalists’ case load from around 18 patients a day to around 30 a day, while asking them to take a pay cut of “anywhere from $15,000 to $25,000.”
Saint Francis Hospital, 355 Ridge Ave., was founded in 1900. It has gone through several owners over the last few decades. Most recently, it was owned by Presence Health, which Ascension acquired in 2018. At the time, Ascension operated its Chicago-area hospitals as a joint venture with AdventHealth under the AMITA Health brand, so Saint Francis was rebranded to “Amita Health Saint Francis Hospital.” When the joint venture was dissolved effective April 1, 2022, it was rebranded again, this time with the Ascension name.
Saint Francis Hospital to outsource some employees is from Evanston RoundTable, Evanston's most trusted source for unbiased, in-depth journalism.