Layoffs, Reduced Services Loom for West Penn Allegheny

Pittsburgh-based West Penn Allegheny Health System may be forced to reduce services and implement layoffs unless it receives a cash infusion by June 2013, according to a Pittsburgh Business Times report.

The hospital system has indicated the potential cutbacks in recent court filings. Beginning in 2017, long-term debt payments for West Penn will swell to an annual average of $34 million through 2040, depending on debt maturity rates, according to the report. That's more than twice its long-term debt payments of $16 million in fiscal year 2012.

So far, West Penn's board has resisted a financial restructuring through Chapter 11 bankruptcy. That was the reason West Penn called off its pending merger with Pittsburgh-based health insurer Highmark in late September.

More Articles on Highmark and West Penn:

West Penn CEO May Step Down Next Week
West Penn Allegheny Health System's Operating Losses Top $112M
Fitch Downgrades West Penn Bonds to "CCC"

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