West Reading, Pa.-based Tower Health plans to lay off around 350 employees, or about 3% of its more than 10,000 staff, and will reduce programs at its Pottstown (Pa.) Hospital, the Philadelphia Business Journal reported Nov. 7.
Pottstown Hospital, a 213-bed facility that employs around 1,150 staff, will cut 131 administrative and clinical positions as part of the reductions. Tower Health will also close Pottstown’s intensive care unit, medical and surgical step down unit and endoscopy center in mid-January, and will reduce services at Pottstown Hospital’s McGlionn Cancer Institute Institute outpatient care center.
A spokesperson for Tower Health said in a Nov. 7 statement shared with Becker’s that the system took “important steps to transform” its operations and create “more nimble and resilient organization” amid major industry headwinds.
“These changes are not simply about reducing costs,” the statement said. “They reflect a strategic priority to reinvest savings in the pillars that power our future. That includes expanding our provider network, accelerating innovation through AI and technology adoption and enhancing the overall patient experience.”
In an internal note to Tower Health employees obtained by Becker’s, Michael Stern, President and CEO of the system, also highlighted ongoing financial pressures and uncertainties, including rising supply chain and labor costs and reimbursement rates that have not kept up with expenses. He also pointed to demographic shifts, such as a growing Medicare population, as well as evolving Medicaid policies and uninsured patients for adding to a complex care environment.
“Tower Health is not immune to these realities. We have worked diligently these last years to navigate these challenges, but continuing the same path is no longer viable,” he said. “To protect our mission and ensure we can continue delivering exceptional care well into the future, we must make thoughtful, forward-looking decisions today.”
The Pennsylvania Association of Staff Nurses and Allied Professionals said in a Nov. 7 news release shared with Becker’s that the service cuts and layoffs are a “devastating blow” to the Pottstown community, nurses and healthcare workers.
PASNAP represents more than 11,000 front-line nurses and healthcare workers across Pennsylvania, including 275 nurses at Pottstown Hospital.
“These service cuts will deepen healthcare disparities, force patients to travel farther for essential treatment and leave caregivers and families in crisis,” Maureen May, RN, president of PASNAP, said in the release. “This community deserves better.”
The cuts come after Tower Health laid off less than 0.5% of its total employee headcount in late June, which included management-level roles and vacant positions. Tower Health said in a statement shared with Becker’s regarding the cuts that while its financial position had improved, it remained “focused on driving continuous improvement” across the system.
