Michigan hospital blames 'aggressive, direct competitor' for financial troubles

Dickinson County Healthcare System in Iron Mountain, Mich., continues to face financial stress even after laying off about 10 percent of its staff in the past year, according to The Daily News.

The hospital laid off 80 employees, or about 10 percent of its staff, between June 2017 and June 2018 to improve its financial position. However, the hospital still faces financial pressure due to a decline in patient volume.

"There is an aggressive, direct competitor in our market and they are funneling healthcare dollars into other communities and away from DCHS," the hospital stated in a press release, according to The Daily News.

"As we are all aware, the healthcare dollars that are generated in our communities through our insurance coverages and from Medicare and Medicaid are limited," said John Schon, administrator and CEO of Dickinson County Healthcare System, according to the report. "If patients are referred out of this community for services that are provided at our local hospital, the result will be the loss of these services in the future, eventually leading to the further loss of jobs and jeopardizing the hospital's future ability to continue to provide the full scope of services it currently provides for our community 24 hours per day, seven days per week, 365 days a year."

Mr. Schon said DCHS could have avoided some layoffs if patient volumes had not fallen in the first half of this year.

"The annual impact of these staffing reductions equates to an estimated $4.5 million reduction in our hospital payroll. However, if our hospital patient utilization would have remained the same as 2017, we would have been able to maintain a significant number of these jobs — bolstering our local economy, rather than the economy of other communities where patients are being referred for their patient care," he said.

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