Layoffs continue at hospitals across the country

Work-force reductions continue trend of cutting staff to maintain financial viability.

By Victoria Stagg Elliott — Posted May 21, 2009

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Health care systems -- both large and small, dependent on large endowments or relying on primarily on insurance payments -- cut staff in April in order to weather the current financial storm.

"These challenges are facing everyone in health care," said Jarrod Cady, public relations manager for Nemours Florida in Orlando. "We had to take thoughtful and decisive action to increase efficiencies across the organization."

For instance, Nemours, one of the largest health systems dedicated to the care of children with facilities in four states, laid off 240 of its 4,400 employees. That was primarily because the Alfred I. duPont Testamentary Trust, which provides much of its operating budget, declined in value from $4.5 billion to $3 billion. This, combined with shortfalls in insurance reimbursement, meant that system officials had to find a way to fill a $60 million funding gap. Salary increases also were less than in prior years, and open positions went unfilled.

Most layoffs focused on support staff. However, Loyola University Medical Center in Maywood, Ill., on May 12 said nurses and clinical staff would be among 440 employees cut.

According to the most recent data from the U.S. Dept. of Labor's Bureau of Labor Statistics, 3,068 people were laid off at ambulatory health care centers or hospitals in January. Another 1,125 lost their jobs in February. Data released by the American Hospital Assn. April 27 revealed that 48% of hospital chief executive officers had cut staff since September 2008.

Ministry Health Care, a network of hospitals and clinics in Wisconsin and Minnesota, also shed 90 out of 12,000 employees primarily in response to growth in bad debt and increased demand for charity care. The organization froze wages, worked to control supply costs and set up feedback systems to collect money-saving ideas from employees.

"We held out as long as we could," said Geoffrey Huys, director of public relations and communications for Ministry. "The little things all added up, but they didn't get us to where we needed to be."

Elsewhere in the country, Reading Hospital and Medical Center in West Reading, Pa., also announced that 250 out of 6,400 positions would be lost through attrition, voluntary separations and permanent layoffs. Summit Medical Center in Van Buren, Ark., lost about 10 positions out of its work force of 274. Spokespeople were unwilling to reveal the exact number.

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