Financial fallout from COVID-19: 38 hospitals laying off workers

The financial challenges caused by the COVID-19 pandemic have forced hundreds of hospitals across the nation to furlough, lay off or reduce pay for workers, and others have had to scale back services or close. 

U.S. hospitals are estimated to lose more than $323 billion this year, according to a report from the American Hospital Association. The total includes $120.5 billion in financial losses the AHA predicts hospitals will see from July to December. 

Lower patient volumes, canceled elective procedures and higher expenses tied to the pandemic have created a cash crunch for hospitals. Though Congress has allocated $175 billion in relief aid for hospitals and other healthcare providers, it isn't enough to cover the lost revenue and higher expenses some are experiencing due to the pandemic.  

Hospitals are taking a number of steps to offset financial damage. Executives, clinicians and other staff are taking pay cuts, capital projects are being put on hold, and some employees are losing their jobs. More than 260 hospitals and health systems have furloughed workers in recent months and dozens others have implemented layoffs. 

Below are 38 hospitals and health systems that have announced layoffs since May 1. 

1. Citing patient volume changes caused by the COVID-19 pandemic, MemorialCare's Long Beach (Calif.) Memorial Medical Center laid off 40 staff members. The layoffs, which occurred in August, mainly affected administrative and management positions.

2. The University of Texas Medical Branch in Galveston is laying off 200 workers as it faces a budget shortfall of $174 million. Interim President Ben Raimer, MD, said the budget shortfall is due to financial damage linked to the COVID-19 pandemic. The layoffs will affect approximately 1.5 percent of UTMB Health's workforce. 

3. Indianapolis-based Community Health Network saw revenues decline in the first six months of this year and ended the period with an operating loss. The health system implemented several cost reduction initiatives to help reduce financial strain. As of June 30, the health system cut 80 jobs, eliminated the match component of its 401(k) plan from Aug. 1 through Dec. 31, announced plans to close its inpatient rehabilitation hospital in Kokomo, Ind., and consolidated revenue cycle and other information systems to eliminate $61.6 million in costs. 

4. Martha's Vineyard Hospital in Oak Bluffs, Mass., cut 11 administrative positions. The hospital cited financial challenges linked to the COVID-19 pandemic as a reason for the layoffs. The hospital said it is adding patient care-related positions. 

5. Yuma (Ariz.) Regional Medical Center said Aug. 4 it will cut 34 positions. The hospital said the layoffs primarily affect those in support roles and are due to lower inpatient volume.

6. Grand Forks, N.D.-based Altru Health System laid off 167 employees, about 6.5 percent of its workforce. The health system attributed the layoffs to financial challenges tied to the COVID-19 pandemic. Altru paused construction on a new hospital, rolled back staffing hours and cut executive pay by 30 percent before resorting to layoffs.

7.  Bluefield (W.Va.) Regional Medical Center closed July 30 and laid  off 340 employees. Officials said the decision to shut down the hospital was based on several factors, including declining patient volume and reimbursement rates and significant financial damage tied to the COVID-19 pandemic. 

8. Bloomington, Minn.-based HealthPartners announced  in early July that it is eliminating 200 jobs at two of the seven clinics it's in the process of closing. The health system shut down the clinics due to the COVID-19 pandemic and will not reopen the sites. 

9. Citing financial challenges from the pandemic, Seattle-based UW Medicine announced July 21 that it would lay off 100 workers. In addition to the layoffs, UW Medicine will reorganize and consolidate in several departments. It has already furloughed 4,000 unionized employees and 1,500 non-union staff members. 

10. Daytona Beach, Fla.-based Halifax Health said in early July that it laid off 95 employees to help offset losses attributed to the pandemic. The laid-off employees were among nearly 400 Halifax Health staffers furloughed in April. 

11. Potsdam, N.Y.-based St. Lawrence Health System announced in early July that it would lay off 26 workers who were placed on furlough to help offset revenue losses attributed to the pandemic. 

12.Huntington, W.Va.-based Mountain Health Network laid off 64 employees to help offset losses linked to the COVID-19 pandemic. The affected positions include employees in leadership roles as well as some workers who were furloughed in April. 

13. Wheeling (W.Va.) Hospital plans to reduce its workforce to help offset financial damage tied to the COVID-19 pandemic and a pending settlement with the Department of Justice. The hospital said it will start by offering voluntary buyouts to staff, but if it fails to achieve appropriate staff reductions, an involuntary reduction plan will be implemented. 

14. Boise, Idaho-based Saint Alphonsus Health System said it will lay off some employees and make other cuts to help offset financial damage tied to the pandemic. The health system's cost reduction plan includes eliminating vacant positions, extending some furloughs and eliminating a limited number of positions. 

15. Citing financial challenges from the COVID-19 pandemic, Springfield, Ill.-based Hospital Sisters Health System plans to reduce its workforce by 10 percent. As of fiscal year 2019, the system had more than 15,000 employees. The 15-hospital system said that the reductions primarily affect employees in nonclinical roles and include some of those who were furloughed in April.  

16. Claxton-Hepburn Medical Center in Ogdensburg, N.Y., laid off its CFO as part of a restructuring and cost-cutting plan. Kelly Tiernan, who served as the hospital's CFO since 2011, was laid off and replaced by an interim CFO. The goal is to "find efficiencies," and the interim CFO will explore combining the hospital's accounting department with one of its affiliates. The 115-bed hospital has laid off or furloughed more than 100 employees this year. 

17. Fayetteville, N.C.-based Cape Fear Valley Health furloughed in late March 783 employees to help offset a drop in patient volume and revenue losses attributed to the COVID-19 pandemic. Of those furloughed employees, 62 employees will not be returning, according to the health system. 

18. Utica, N.Y.-based Mohawk Valley Health System President and CEO Darlene Stromstad warned in a memo July 27 that employees will face layoffs and more furloughs as the system grapples with pandemic losses. 

19. In June, Trinity Health, a 92-hospital system based in Livonia, Mich., announced it would lay off and reduce work schedules of 1,000 employees.The job cuts primarily affected nonclinical and administrative positions.

20. Dayton (Ohio) Children's Hospital said it cut jobs to help offset financial losses due to the COVID-19 pandemic. A spokesperson did not provide the number of staff affected by the workforce reduction, but she said cuts involved a cross-section of roles. 

21. Traverse City, Mich.-based Munson Healthcare cut 25 leadership positions to help offset financial losses amid the COVID-19 pandemic. The nine-hospital health system took a financial hit from the suspension of elective procedures and pandemic-related expenses. Overall, Munson lost about $140 million in revenue from March through June, in addition to about $10 million in COVID-19-related expenses. 

22. Chattanooga, Tenn.-based Erlanger Health System cut 93 nonclinical positions to help offset financial damage from the COVID-19 pandemic. The layoffs came  after the health system cut 11 leadership positions in June. 

23. Ann Arbor-based Michigan Medicine planned to eliminate 738 positions by the end of June amid financial challenges from the COVID-19 pandemic. In May, the health system said it projected a financial loss of up to $230 million in the fiscal year ending June 30 and planned to furlough or lay off 1,400 full-time employees.

24. As part of a restructuring effort to cut pandemic-related losses, State College, Pa.-based Mount Nittany Health System announced plans in June to lay off 10 percent of its workforce, or about 250 employees.

25. Cincinnati-based TriHealth cut 440 positions as part of a plan to trim at least $140 million in expenditures this year. Of the 440 positions eliminated, 150 were vacant. As a result, 290 employees had their jobs eliminated. Most of the affected employees worked in shared corporate services, including revenue cycle, marketing, human resources and information technology. 

26. The University of Kansas Health System St. Francis Campus in Topeka laid off employees after previously implementing furloughs. The health system restructured and consolidated some services and laid off 33 employees to manage the impact of COVID-19.

27. Citing a $212 million loss in revenue through May due to the COVID-19 pandemic, West Reading, Pa.-based Tower Health plans to cut 1,000 jobs. The layoffs affected about 8 percent of Tower Health's 12,355-person workforce. 

28. Parkview Medical Center in Pueblo, Colo., eliminated 22 positions in response to the COVID-19 pandemic. Hospital officials said the cuts affect less than 1 percent of its workforce.

29. Little Rock-based Arkansas Children's Hospital eliminated 42 jobs as part of cost-savings measures in response to the COVID-19 pandemic. The 42 job cuts affect 17 vacant positions. Twenty-five of the job cuts will result in layoffs.

30. Citing a financial hit from the COVID-19 pandemic, Lumberton, N.C.-based Southeastern Health will permanently close several clinics, cut 10 percent of its workforce and reduce executive pay. 

31. The University of Mississippi Medical Center in Jackson announced in late May that it is laying off 250 workers. In a memo to employees sent May 27, hospital leaders said UMMC had been losing more than $1 million per day since mid-March, and internal projections show a $100 million deficit through September. 

32. Baylor Scott & White Health announced in late May that it was laying off about 1,200 employees, nearly 3 percent of its workforce. The Dallas-based health system spent $85 million to prepare for and respond to the pandemic, and it also saw patient volume declines between 50 percent and 90 percent, depending on the site of care. 

33. Pittsburgh-based Allegheny Health Network announced May 21 that it would lay off 250 of its more than 21,000 employees. The affected jobs are primarily in corporate and administrative functions, but include some clinical staff at physician practices. The layoffs were partially due to lower patient volume and fewer elective surgeries due to the pandemic. 

34. Duluth, Minn.-based Essentia Health laid off 900 employees, about 6 percent of its workforce, to help offset severe financial damage caused by the pandemic. As of late May, the health system was facing $100 million in losses due to declines in patient volume since the beginning of March. 

35. Buffalo, N.Y.-based Erie County Medical Center laid off 70 workers to help offset losses tied to the pandemic. The hospital said the layoffs were necessary after it didn't meet the threshold to receive targeted hot spot funding through the Coronavirus Aid, Relief and Economic Security Act. 

36. Valley View Hospital in Glenwood Springs, Colo., laid off about 100 employees, approximately 10 percent of its workforce. In an internal memo, Valley View Hospital CEO Brian Murphy, MD, said the COVID-19 pandemic had "dramatically reduced" the hospital's income. The hospital is projecting a decline in income of $30 million to $45 million this year due to COVID-19. 

37. Fulton County Medical Center in McConnellsburg, Pa., laid off 36 employees in early May due to the financial strain of the pandemic. The layoffs, mostly in nonclinical departments, will help ensure the long-term viability of the hospital, officials said. 

38. King City, Calif.-based Mee Memorial Healthcare System laid off 55 workers to help offset revenue declines due to the pandemic. The health system said it pursued financial assistance through the Coronavirus Aid, Relief and Economic Security Act and other programs but a funding gap remained. 

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