Hospital laundry consolidation falls short of $1.7M savings target
Centralization plagued by high turnover and high learning curve, according to new documents
Taxpayers aren’t saving nearly as much money as expected from the consolidation of hospital laundry services, CBC News has learned.
The planned shift of four hospital laundries in Moncton, Tracadie-Sheila and Bathurst to two centralized locations in Saint John and Campbellton was plagued with problems that meant cost savings fell short of projections, obtained documents reveal.
"Although savings are being realized, they will be significantly less than predicted," says the September 2014 briefing note.
The document was prepared by FacilicorpNB, the provincial agency set up to centralize and deliver non-medical services in the health care system at a lower cost.
The previous Alward government made a virtue of reducing unnecessary spending in the health care system, which included reducing some non-clinical positions.
"It’s pretty easy when you have more people than you need," then-health minister Ted Flemming said in 2013.
But the centralization required FacilicorpNB to hire additional employees to cope with the addition of 17 nursing homes to the system.
That meant a net reduction of 13 positions so far, according to FacilicorpNB.
The plan was to shift laundries at The Moncton Hospital and the Dr. Georges-L.-Dumont University Hospital Centre to a central facility in Saint John and to move services in Bathurst and Tracadie-Sheila to the Campbellton hospital.
“Our goal remains to complete the closure of both these laundries,” says FacilicorpNB’s director of communications, Chantal Poulin.
“We are confident that the project once completed, will create savings.”
Poulin says the agency wants to provide both health authorities “with safe, quality laundry services in the most effective way possible.” But the Dumont and Bathurst closures have been delayed “so that we may effectively apply lessons learned to the next phase.”
The projected savings of $1.7 million over three years won’t happen, the document says, though there’s no revised estimate.
Among the problems with the Campbellton centralization:
- When the Tracadie-Sheila laundry was moved to Campbellton, productivity in Campbellton dropped because of the extra volume of work.
- There were "complexities" around the delivery of laundry to nursing homes in the Acadian Peninsula.
- The adding of a second partial shift was also complicated, and while extra supervision, training and hiring more employees helped, productivity in Campbellton was "still below target."
Rino Volpé, the former chief executive officer of the Vitalité Health Network, who was fired by the new Liberal government in November, alluded to the problems in a CBC interview not longer after he was fired.
"We didn’t feel that Facilicorp was ready, that that project was planned properly. Even the management in place at the time were not used to that type of operation," he said.
Details of problems in moving The Moncton Hospital’s laundry to Saint John have been deleted from the version of the document released to CBC News.
The shift to Saint John was premised on some surgeries in that hospital using disposable linens, freeing up people and capacity in the laundry operations there.
But it notes several overall problems with the entire initiative, including high employee turnover from laundry closures, staff adjustment to new shift schedules, management’s learning curve, and an underestimate of the hirings needed to add 17 nursing home laundries to the system.
"This experience is being used in revising pre-consolidation assumptions that have created a structural deficit that will need to be addressed," it states.
The delays at the Dumont and in Bathurst affected "the timing of achievements of savings" in Facilicorp’s original plan, the document indicates.
Health Minister Victor Boudreau, who has talked about finding further savings in health care since taking office last October, was not available for comment.
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