My blog post on Monday was misleading on one key point. I regret that. Now I’m going to try to fix it.
After listening to a video of Community Health Network CEO Bryan Mills talking to a group of his leaders, I wrote this: “Mills said he and his managers briefly considered laying off 1,000 people last summer.”
My phrase “briefly considered” was interpreted in a stronger way than I intended. It apparently caused some folks inside Community to assume that the hospital system’s executives had a list of 1,000 names of people to be let go.
Mills told me on Tuesday that was absolutely not true. And, based on what he actually said in the video, there is no evidence that Community got anywhere close to actually laying off people in large numbers.
Here is, in full, what Mills said on this subject:
“They [bond rating agencies] came in last year. We told them what we were doing. Told them that we would have a 5 percent margin, and here’s all the ways we’re going to do it.
“Bingo. By June we realized that is not going to happen, is not going to happen.
“So we tell them. They come back and do their evaluations on us. And we say, ‘Here’s the deal. We can’t get there. And we’re going to continue to work on getting better. We’ve got some good things happening, and we’ve got some things to work on.' We talked to them about charity care and all these other things we had problems with. 'But we will hit 3 percent. We will hit 3 percent.’ OK?
“They said, ‘You better. Because if you don’t hit 3 percent, we’re going to cut you off on access to capital. We’re going to downgrade your bonds.' So all of a sudden will anybody buy your bonds? Is there a market for them? Real serious stuff.
“So in November and early December, we’re running around saying, ‘OK, what are all the levers we have?’ You know, one of the levers could be, we could have gone and said, back in August, 'We’re going to have a network-wide layoff. We’re going to take 1,000 jobs out of this organization.' We could’ve done that.
“But I said, ‘How the heck do you do that when you’re doing more care? It doesn’t make sense.’
“And yes, we’ve got people who aren’t here that were here, we’ve got departments that aren’t here that were here. I call that management. I call that going through and trying to systematically make sure we don’t lose sight of our focus, and we make changes. And we’ll continue to make changes.
“But to me that would have been a decision just to satisfy a bondholder. It would not be a decision to make sure we’re in accordance with our mission. So I didn’t do it. I guarantee you they wished I had.”
Others who I respect watched the video and told me my use of the word “considered” implied more than what Mills actually said.
In that way, my post was misleading. I didn’t intend for it to be. But it was. Hopefully this post sets the record straight.