One Brooklyn Health just weathered one of New York City’s worst flu seasons in a decade. Its nurses, already stretched thin, had delivered strike notices weeks earlier. Its margins were already in the negative. And its patient population is squarely in the crosshairs of federal policy changes projected to strip billions from hospital revenue starting in 2027.
Amid financial strain and workforce pressure, One Brooklyn Health cut more than 50 nonclinical administrative roles — including leadership positions — in February as part of a broader realignment aimed at ensuring long-term financial sustainability.
For CEO Sandra Scott, MD, averting a strike in January was only the most immediate pressure. The harder work is what comes next.
Dr. Scott has led One Brooklyn Health since January 2024. The safety-net system, formed in 2016, serves mostly Medicaid and Medicare patients across its three medical centers and affiliated facilities.
Most patients at One Brooklyn Health are covered by those government programs, she said. Changes introduced by the One Big Beautiful Bill Act to premium subsidies and Medicaid eligibility are projected to reduce hospital revenue across the U.S. by $68.5 billion in 2026 and 2027. New York is projected to lose $4.3 billion — the fourth-highest state loss, according to a Dec. 15 report from Premier.
“Some of the provisions in HR-1 — particularly in New York state — threaten to limit the number of people that have access to healthcare, and that means our uncompensated care is likely to go up,” Dr. Scott said.
“We know that there are inherent structural challenges with the way Medicaid and Medicare reimburse, where some — particularly safety-net institutions — are often not reimbursed the total cost of care, so there’s a fundamental problem there. We try to make sure that they understand that it’s more about us thinking about the long-term future of the organization and trying to ensure financial stability so that we remain viable.”
Compounding projected losses, supply and workforce costs are rising, Dr. Scott said. The former accounted for 13% of hospitals’ costs in 2024, on average, according to an April report from the American Hospital Association. A November report from Kaufman Hall found labor expenses are continuing to increase throughout nearly every region and hospital size, up 5% year over year across the U.S.
“It’s necessary that workforce costs go up because that’s the nature of our economy. We’re not thinking that labor expenses will stay flat,” Dr. Scott said. “It’s important that we communicate to our labor partners in such a way that they understand what those pressures mean and the big picture of the financial management of particularly safety net institutions that often have negative margins and require subsidies to be able to balance our budgets.”
It was against this backdrop that contract negotiations between New York City hospitals and the state’s largest nurses union came to a head. On Jan. 2, the New York State Nurses Association delivered 10-day strike notices to 12 hospitals. By Jan. 12, the largest nurses strike in city history had begun across four hospitals. Tentative agreements were reached at three of the four hospitals Feb. 9, and more than 4,200 nurses at one hospital remain on strike as of Feb. 17, seeking a contract focused on safe staffing, healthcare benefits and workplace violence protections.
Nurses at the remaining hospitals — all safety-net providers — withdrew their strike notices after reaching tentative agreements on key contract provisions. Among those hospitals were One Brooklyn Health’s Interfaith Medical Center and Kingsbrook Jewish Medical Center.
Management at the safety-net hospitals that avoided strikes agreed to fully fund healthcare benefits for nurses, support workplace violence prevention efforts and maintain safe staffing standards, the union said. They also agreed to wage increases equitable to what nurses at the three systems still striking eventually secure.
“The safety-net hospitals that care for New York City’s most vulnerable patients are doing the right thing by guaranteeing healthcare benefits for nurses and agreeing to stronger safe staffing standards and protections from workplace violence,” NYSNA President Nancy Hagans, BSN, RN, said in a statement. “New York City’s wealthiest hospitals should follow their lead.”
Still, labor expenses must be balanced with other financial constraints, Dr. Scott said. She described an approach rooted in transparency — making sure union partners understand the full financial picture, even as the system commits to fair wages and benefits.
“We’re explicit about our desire to collaborate, and our desire to give them what they need and what’s fair,” Dr. Scott said. “But at the same time, we have to make sure that we have a path to financial stability because we want the organizations to stay open. We want to be able to continue to provide services to the communities that we serve, and we safety-net institutions serve a vulnerable population.”
Dr. Scott credited the system’s negotiating team, led by Ari Moma and Vivienne Phillips, RN, with setting that tone at the table.
“We really worked hard to be collaborative in our negotiations, and that kind of work must continue at all institutions so that we can avoid more contentious negotiations in the future,” she said.
