MedStar hospital lays off 100 employees in attempt to close budget shortfall

MedStar Washington Hospital Center — a nonprofit, 912-bed academic medical center in the District of Columbia — is laying off 100 employees as it seeks to close a budget gap, according to the Washington Business Journal

The 100 affected employees, which include both managers and non-managers, make up about 2 percent of the hospital's workforce, according to the report.

In a June 2 email to employees, MedStar Washington Hospital Center President John Sullivan blamed the layoffs on financial challenges in the most recent fiscal year.

"We have a sizable budget shortfall for the coming year — a gap between our budgeted revenue and expenses — and we have to close that gap before July 1, when the new fiscal year begins," wrote Mr. Sullivan, according to the report. 

In a statement to the Washington Business Journal, MedStar Washington Hospital Center said several factors have negatively affected the hospital's finances, including higher pharmaceutical and medical supplies costs and a shortage of nurses that required the hospital to hire more costly agency nurses.  

A MedStar spokeswoman told Becker's the employees impacted by the layoffs were notified last week. Some of the affected employees may be relocated within the organization. 

"We are confident that the changes we made in creating our FY18 budget ensure MedStar Washington Hospital Center's stability for the future, and we are starting FY18 foundationally strong — in all aspects of the important work we do for our patients and the community," MedStar said in an emailed statement.    

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