September 25, 1998

As the hospital continues to tighten its financial belt, the MGH this week announced a fiscal year 1999 wage and salary program that includes a performance-based wage and salary increase. In a letter distributed to employees with their paychecks this week, James J. Mongan, MD, president of the MGH, cited the extraordinary efforts of employees to deliver the best care and services while facing the challenge of high patient volume and increased managed care pressure.

Employees are eligible for a pay increase on their raise-effective date. A completed performance appraisal is required before any increase or bonus is processed. The range of the increases is from 0 to 5 percent, and the General Hospital program is funded at 3 percent, similar to programs at other Partners-affiliated institutions.

According to Jeff Davis, senior vice president for Human Resources, the wage and salary program has not changed over the past two years. This year, however, all of the pay ranges – including the maximum and minimum range – will be raised by 3 percent, allowing employees at the top of their range to be eligible for the wage increase rather than a bonus. Those who are above the maximum for their pay range are eligible for a bonus of up to 3 percent on that date.

The wage and salary program follows a challenging budget process that involved expense cuts hospitalwide to close a sizable budget gap. At a leadership meeting Sept. 22, Mongan announced that managers had identified ways to reduce the projected $10.5 million gap in the FY '99 budget to a $3.6 million gap by reducing departmental expenses by half and stepping up management initiatives to control costs. The remaining gap will be closed by eliminating approximately 100 of the currently vacant full-time equivalent (FTE) positions. There currently are 400 FTE vacant positions throughout the hospital. Mongan emphasized that there will be no layoffs related to this year's budget-balancing efforts.