Many health system mergers today are “all about leverage” when negotiating with payers, rather than significant cost savings or increasing market share, Charlie Shields, CEO of Kansas City, Mo.-based University Health, told the Kansas City Business Journal.
Mr. Shields’ comments came after Kansas City-based St. Luke’s Health System and St. Louis-based BJC HealthCare signed a letter of intent to form an integrated academic health system.
The proposed merger is not about reducing costs — since the two systems have been part of a buying collective for a decade —- and is not about a rapid gain in market share, since St. Luke’s and BJC will largely stick to their respective areas, Mr. Shields told the Journal in a June 1 article. Instead, he argues, the merger, and similar ones like it, aims to leverage a better seat at the table when negotiating care rates with payers.
BJC and St. Luke’s operate the three top hospitals in Missouri, according to U.S. News & World Report. Together, they would pool $10 billion in revenue to serve more than 6 million residents across Missouri, Illinois and Kansas.
The transaction is expected to close by the end of 2023, pending regulatory review.
On October 1, 1908, Ford produced the first Model T automobile. More than 60 years later, this affordable, mass produced, gasoline-powered car was still the top-selling automobile of all time. The Model T was geared to the broadest possible market, produced with the most efficient methods, and used the most modern technology—core elements of Ford’s business strategy and corporate DNA.
On April 25, 2018, almost 100 years later, Ford announced that it would stop making all U.S. internal-combustion sedans except the Mustang.
The world had changed. The Taurus, Fusion, and Fiesta were hardly exciting the imaginations of car-buyers. Ford no longer produced its U.S. cars efficiently enough to return a suitable profit. And the internal combustion technology was far from modern, with electronic vehicles widely seen as the future of automobiles.
Ford’s core strategy, and many of its accompanying products, had aged out. But not all was doom and gloom; Ford was doing big and profitable business in its line of pickups, SUVs, and -utility vehicles, led by the popular F-150.
It’s hard to imagine the level of strategic soul-searching and cultural angst that went into making the decision to stop producing the cars that had been the basis of Ford’s history. Yet, change was necessary for survival. At the time, Ford’s then-CEO Jim Hackett said, “We’re going to feed the healthy parts of our business and deal decisively with the areas that destroy value.”
So Ford took several bold steps designed to update—and in many ways upend—its strategy. The company got rid of large chunks of the portfolio that would not be relevant going forward, particularly internal combustion sedans. Ford also reorganized the company into separate divisions for electric and internal combustion vehicles. And Ford pivoted to the future by electrifying its fleet.
Ford did not fully abandon its existing strategies. Rather, it took what was relevant and successful, and added that to the future-focused pivot, placing the F-150 as the lead vehicle in its new electric fleet.
This need for strategic change happens to all large organizations. All organizations, including America’s hospitals and health systems, need to confront the fact that no strategic plan lasts forever.
Over the past 25-30 years, America’s hospitals and health systems based their strategies on the provision of a high-quality clinical care, largely in inpatient settings. Over time, physicians and clinics were brought into the fold to strengthen referral channels, but the strategic focus remained on driving volume to higher-acuity services.
More recently, the longstanding traditional patient-physician-referral relationship began to change. A smarter, internet-savvy, and self-interested patient population was looking for different aspects of service in different situations. In some cases, patients’ priority was convenience. In other cases, their priority was affordability. In other cases, patients began going to great lengths to find the best doctors for high-end care regardless of geographic location. In other cases, patients wanted care as close as their phone.
Around the country, hospitals and health systems have seen these environmental changes and adjusted their strategies, but for the most part only incrementally. The strategic focus remains centered on clinical quality delivered on campus, while convenience, access, value, affordability, efficiency, and many virtual innovations remain on the strategic periphery.
Health system leaders need to ask themselves whether their long-time, traditional strategy is beginning to age out. And if so, what is the “Ford strategy” for America’s health systems?
The questions asked and answered by Ford in the past five years are highly relevant to health system strategic planning at a time of changing demand, economic and clinical uncertainty, and rapid innovation. For example, as you view your organization in its entirety, what must be preserved from the existing structure and operations, and what operations, costs, and strategies must leave? And which competencies and capabilities must be woven into a going-forward structure?
America’s hospitals and health systems have an extremely long history—in some cases, longer than Ford’s. With that history comes a natural tendency to stick with deeply entrenched strategies. Now is the time for health systems to ask themselves, what is our Ford F150? And how do we “electrify” our strategic plan going forward?
A couple of months ago, I got a call from a CEO of a regional health system—a long-time client and one of the smartest and most committed executives I know. This health system lost tens of millions of dollars in fiscal year 2022 and the CEO told me that he had come to the conclusion that he could not solve a problem of this magnitude with the usual and traditional solutions. Pushing the pre-Covid managerial buttons was just not getting the job done.
This organization is fiercely independent. It has been very successful in almost every respect for many years. It has had an effective and stable board and management team over the past 30 to 40 years.
But when the CEO looked at the current situation—economic, social, financial, operational, clinical—he saw that everything has changed and he knew that his healthcare organization needed to change as well. The system would not be able to return to profitability just by doing the same things it would have done five years or 10 years ago. Instead of looking at a small number of factors and making incremental improvements, he wanted to look across the total enterprise all at once. And to look at all aspects of the enterprise with an eye toward organizational renovation.
I said, “So, you want a makeover.”
The CEO is right. In an environment unlike anything any of us have experienced, and in an industry of complex interdependencies, the only way to get back to financial equilibrium is to take a comprehensive, holistic view of our organizations and environments, and to be open to an outcome in which we do things very differently.
In other words, a makeover.
Consider just a few areas that the hospital makeover could and should address:
There’s the REVENUE SIDE: Getting paid for what you are doing and the severity of the patient you are treating—which requires a focus on clinical documentation improvement and core revenue cycle delivery—and looking for any material revenue diversification opportunities.
There is the relationship with payers: Involving a mix of growth, disruption, and optimization strategies to increase payments, grow share of wallet, or develop new revenue streams.
There’s the EXPENSE SIDE: Optimizing workforce performance, focusing on care management and patient throughput, rethinking the shared services infrastructure, and realizing opportunities for savings in administrative services, purchased services, and the supply chain. While these have been historic areas of focus, organizations must move from an episodic to a constant, ongoing approach.
There’s the BALANCE SHEET: Establishing a parallel balance sheet strategy that will create the bridge across the operational makeover by reconfiguring invested assets and capital structure, repositioning the real estate portfolio, and optimizing liquidity management and treasury operations.
There is NETWORK REDESIGN: Ensuring that the services offered across the network are delivered efficiently and that each market and asset is optimized; reducing redundancy, increasing quality, and improving financial performance.
There is a whole concept around PORTFOLIO OPTIMIZATION: Developing a deep understanding of how the various components of your business perform, and how to optimize, scale back, or partner to drive further value and operational performance.
Incrementalism is a long-held business approach in healthcare, and for good reason. Any prominent change has the potential to affect the health of communities and those changes must be considered carefully to ensure that any outcome of those changes is a positive one. Any ill-considered action could have unintended consequences for any of a hospital’s many constituencies.
But today, incrementalism is both unrealistic and insufficient.
Just for starters, healthcare executive teams must recognize that back-office expenses are having a significant and negative impact on the ability of hospitals to make a sufficient operating margin. And also, healthcare executive teams must further realize that the old concept of “all things to all people” is literally bringing parts of the hospital industry toward bankruptcy.
As I described in a previous blog post, healthcare comprises some of the most wicked problems in our society—problems that are complex, that have no clear solution, and for which a solution intended to fix one aspect of a problem may well make other aspects worse.
The very nature of wicked problems argues for the kind of comprehensive approach that the CEO of this organization is taking—not tackling one issue at a time in linear fashion but making a sophisticated assessment of multiple solutions and studying their potential interdependencies, interactions, and intertwined effects.
My colleague Eric Jordahl has noted that “reverting to a 2019 world is not going to happen, which means that restructuring is the only option. . . . Where we are is not sustainable and waiting for a reversion is a rapidly decaying option.”
The very nature of the socioeconomic environment makes doing nothing or taking an incremental approach untenable. It is clearly beyond time for the hospital industry makeover.
A recent chat with a former physician entrepreneur who recently sold his practice to a large health system highlighted the fact that “hospital-physician integration” can sometimes be a misnomer. “I feel like we were sold a bill of goods,” he told us, referring to his ten-person primary care group.
“We worked hard to build this practice, and the health system CEO made a lot of promises about the value of bringing us in, and the investments they’d make in our growth.” Instead, the group has experienced a different reality: little meaningful integration, an unclear bureaucracy to navigate, zero transparency into the finances of the medical group or system, leadership turnover, and a lack of strategic vision.
“We would never sign this deal again,” he said, “and we’re not the only ones—they might not realize it, but this system is on the precipice of a full-on physician mutiny.”
Of course, there are two sides to every story, but the anecdote reinforced in our minds the importance of careful planning and attention to integration following practice acquisitions. There needs to be a plan, it needs to be clear, and it needs to be resourced.
Otherwise, systems risk ending up with unhappy, disengaged doctors—a situation to be avoided at all costs.
In the graphic above, we use the most recent data from software and analytics firm Strata Decision Technology to compare 2023 year-to-date (YTD) hospital volumes by admission type to both 2019 and 2022 volumes.
Compared to 2019, outpatient volumes in 2023 have increased by 14 percent, whileinpatient, observation, and emergency (ED) admissions are all down.However, compared to 2022, the reverse trend is true, with inpatient, observation, and ED volumes up from last year while outpatient volumes have dropped slightly.
This suggests that the net increase in outpatient volume and net loss in inpatient and ED volume over the past few years appears to be locked in. While the COVID-accelerated outpatient shift is here to stay, hospitals can take solace in the recent uptick in inpatient, observation, and ED volumes, which helps those still struggling to return to positive operating margins.
Importantly, there is significant regional variability among these volume data, suggesting that health system recovery will not be uniform.
Last week the Minnesota legislature passed a bill to initiate the creation of a public option health insurance plan available to state residents of all incomes. The bill funds an actuarial analysis of the policy and requires the state to apply for a Centers for Medicare and Medicaid Services (CMS) waiver to begin implementation by 2027. The public option plan will build upon MinnesotaCare, a state health plan currently covering residents with incomes below 200 percent of the federal poverty line.
The Gist: Minnesota joins Washington, Colorado, and Nevada as the fourth state to authorize a public option health plan. But unlike these other three states, whose public option programs rely on private payers to manage risk and administration with tighter price controls, Minnesota intends to create a “true” public option in which the government competes directly with private payers.
Analysis funded by a hospital and insurance trade group found that a public option could reduce Minnesota hospital revenues by more than $2B over 10 years, while only lowering the uninsured rate by half a percentage point.
Though Minnesota lawmakers were more concerned with lowering healthcare spending and improving health insurance affordability for state residents, the success of the program will depend in part on how it negotiates with providers, who justifiably fear a worsening payer mix that further threatens margins.
On Monday, Minnetonka, MN-based UHG’s Optum division made a $3.3B all-cash offer to acquire Baton Rouge, LA-based Amedisys, one of the country’s largest home health companies.
Optum’s bid came several weeks after Bannockburn, IL-based Option Care Health, a home health company specialized in drug and infusion services, offered to purchase Amedisys in an all-stock transaction valued at $3.6B. Amedisys itself acquired hospital-at-home company Contessa Health for $250M in 2021. While its Board of Directors is now evaluating whether UHG has made a “Superior Proposal”, a UHG acquisition of Amedisys would likely be subject to significant regulatory oversight, as the payer recently closed on its purchase of home health company and Amedisys-competitor LHC Group in a deal that was heavily scrutinized by the Federal Trade Commission.
The Gist: UHG, the nation’s largest health insurer, is on a tear to bring the country’s largest home health providers under its Optum umbrella—and it has the deep pockets to outbid nearly anyone else trying to do the same.
While some questioned the value of an Option Care-Amedisys combination, UHG would get to plug another asset into its scaled continuum of home-based care, allowing it to steer beneficiaries away from high-cost post acute care and continue to increase profitable intercompany eliminations.
If UHG’s bid for Amedisys is accepted, it would also gain its first hospital-at-home asset in Contessa, providing it with the opportunity to fully redirect—and reduce—its inpatient care spend.
On April 1st, Medicaid’s pandemic-era continuous enrollment policy began to sunset, kicking off a 14-month window for states to reassess their Medicaid rolls. In this week’s graphic, we highlight new Congressional Budget Office projections showing the impact of Medicaid redeterminations on insurance coverage rates over the next decade for the under-65 population.
The Medicaid and Children’s Health Insurance Program (CHIP) coverage rate is expected to drop from 31 percent of all Americans under 65 in 2023, to 27 percent in 2024.
Meanwhile, after reaching an all-time low in 2023,the under-65 uninsured rate is projected to surpass nine percent in 2024 and climb to over 10 percent by 2033.
While over 15M Americans are expected to lose Medicaid coverage during redeterminations, a majority of those disenrolled will gain health insurance either through an employer-sponsored or non-group plan.
But over 6M people, nearly 40 percent of those losing Medicaid coverage, are projected to become uninsured, erasing nearly half the progress the country has made since 2019 at lowering the uninsured rate.
A number of hospitals and health systems are trimming their workforces or jobs due to financial and operational challenges.
Below are workforce reduction efforts or job eliminations that were announced within the past 10 months and/or take effect later this year.
1. Dartmouth Health is laying off 75 workers and eliminating 100 job vacancies. The layoffs came after the Lebanon, N.H.-based health system implemented a performance improvement plan in November.
2. Seattle Children’s is eliminating 135 leader roles, citing financial challenges. The management restructuring and reduction affects 1.5 percent of employees across the organization.
3. White Rock (Texas) Medical Centerlaid off 30 workers across 28 departments. The layoffs include clinical and administrative roles.
4. Jackson, Miss.-based St. Dominic Health Services is laying off 157 workers and ending behavioral health services. The reduction represents 5.5 percent of the hospital’s workforce.
5. Danville, Pa.-based Geisingerlaid off 47 employees from its IT department. The reduction is part of a restructuring plan to offset high labor and supply costs.
6. Cascade Behavioral Health Hospital in Tukwila, Wash., is winding down operations and laying off 288 employees. The 137-bed psychiatric facility is slated to close by July 31.
7. Cambridge (Mass.) Health Alliance is laying off 69 employees, reducing the hours of 15 others and eliminating 170 open positions, according to The Boston Globe. The reductions are primarily in management, administrative and support areas, a health system spokesperson told Becker’s.
8. Wenatchee, Wash.-based Confluence Health has eliminated its chief operating officer amid restructuring efforts and financial pressures, the health system confirmed to Becker’s May 16.
9. Conemaugh Memorial Medical Center, a Duke LifePoint hospital in Johnstown, Pa., has laid off less than 1 percent of its workforce, the hospital confirmed to Becker’s May 15.
10. Community Health Network, a nonprofit health system based in Indianapolis, plans to cut an unspecified number of jobs as it restructures its workforce and makes organizational changes. The health system confirmed the job cuts in a statement shared with Becker’s on May 11. It did not say how many jobs would be cut or which positions would be affected.
11. New Orleans-based Ochsner Healtheliminated 770 positions, or about 2 percent of its workforce, on May 11. This is the largest layoff to date for the health system.
12. Cedars-Sinai Medical Center eliminated the positions of 131 employees and cut about two dozen other jobs at related Cedars-Sinai facilities, a spokesperson confirmed via a statement shared with Becker’s May 7. The Los Angeles-based organization said reductions represent less than 1 percent of the workforce and apply to management and non-management roles primarily in non-patient care jobs.
13. Rochester (N.Y.) Regional Health is eliminating about 60 positions. A statement from RRH said the changes affect less than one-half percent of the system population, mostly in nonclinical and management positions.
14. Memorial Health Systemlaid off fewer than 90 people, or less than 2 percent of its workforce.The Gulfport, Miss.-based health system said May 2 that most of the affected positions are nonclinical or management roles, and the majority do not involve direct patient care.
15. Monument Health laid off at least 80 employees, or about 2 percent of its workforce. The Rapid City, S.D.-based system said positions are primarily corporate service roles and will not affect patient services. Unfilled corporate service positions were also eliminated.
16. Habersham Medical Center in Demorest, Ga.,laid off four executives. The layoffs are part of cost-cutting measures before the hospital joins Gainesville-based Northeast Georgia Health System in July, nowhaberbasham.com reported April 27.
17. Scripps Health is eliminating 70 administrative roles, according to WARN documents filed by the San Diego-based health system in March. The layoffs take effect May 8 and affect corporate positions in San Diego and La Jolla, Calif.
18. Trinity Health Mid-Atlantic, part of Livonia, Mich.-based Trinity Health, eliminated fewer than 40 positions, a spokesperson confirmed to Becker’s April 24. The layoffs represent 0.5 percent of the health system’s approximately 7,000-person workforce.
19. PeaceHealth eliminated 251 caregiver roles across multiple locations. The Vancouver, Wash.-based health system said affected roles include 121 from Shared Services, which supports its 16,000 caregivers in Washington, Oregon and Alaska.
20. Toledo, Ohio-based ProMedica plans to lay off 26 skilled nursing support staff. The layoffs, effective in June, affect 20 employees who work remotely across the U.S, and six who work at the ProMedica Summit Center in Toledo, according to a Worker Adjustment and Retraining Notification filed April 18. Most affected positions support sales, marketing and administrative functions for the skilled nursing facilities, Promecia told Becker’s.
21. Northern Inyo Healthcare District, which operates a 25-bed critical access hospital in Bishop, Calif., anticipates eliminating about 15 positions, or less than 4 percent of its 460-member workforce, by April 21, a spokesperson confirmed to Becker’s. The layoffs include nonclinical roles within support and administration, according to a news release. No further details were provided about specific positions affected.
22. West Reading, Pa.-based Tower Health is eliminating 100 full-time equivalent positions. The move will affect 45 individuals, according to an April 13 news release the health system shared with Becker’s. The other 55 positions are either recently vacated or involve individuals who plan to retire in the coming weeks and months.
23. Grand Forks, N.D.-based Altru Health is trimming its executive team as its new hospital project moves forward. The health system is trimming its executive team from nine to six and incentivizing 34 other employees to take early retirement.
24. Tacoma, Wash.-based Virginia Mason Franciscan Healthlaid off nearly 400 employees, most of whom are in non-patient-facing roles. The job cuts affected less than 2 percent of the health system’s 19,000-plus workforce.
25. Katherine Shaw Bethea Hospital in Dixon, Ill., will lay off 20 employees, citing financial headwinds affecting health organizations across the U.S. It will also leave other positions unfilled to reduce expenses amid rising labor and supply costs and reductions in payments by insurance plans. Affected employees largely work in administrative support areas and not direct patient care.
26. Danbury, Conn.-based Nuvance Health will close a 100-bed rehabilitation facility in Rhinebeck, N.Y., resulting in 102 layoffs. The layoffs are effective April 12, according to the Daily Freeman.
27. Charleston, S.C.-based MUSC Health University Medical Centerlaid off an unspecified number of employees from its Midlands hospitals in the Columbia, S.C. area. Division President Terry Gunn also resigned after the facilities missed budget expectations by $40 million in the first six months of the fiscal year, The Post and Courier reported March 30.
28. Winston-Salem, N.C.-based Novant Healthlaid off about 50 workers, including C-level executives, the health system confirmed to Becker’s March 29. The layoffs affected Jesse Cureton, the health system’s executive vice president and chief consumer officer since 2013; Angela Yochem, its executive vice president and chief transformation and digital officer since 2020; and Paula Dean Kranz, vice president of innovation enablement and executive director of the Novant Health Innovation Labs.
29. Penn Medicine Lancaster (Pa.) General Health eliminated fewer than 65 jobs, or less than 1 percent of its workforce of about 9,700, the health system confirmed to Becker’s March 30. The layoffs include support, administrative and executive roles, and COVID-19-related support staff, spokesperson John Lines said, according to lancasteronline.com. Mr. Lines did not provide a specific number of affected workers.
30. McLaren St. Luke’s Hospital in Maumee, Ohio, will lay off 743 workers, including 239 registered nurses, when it permanently closes this spring. Other affected roles include physical therapists, radiology technicians, respiratory therapists, pharmacists and pharmacy support staff, and nursing assistants. The hospital’s COO is also affected, and a spokesperson for McLaren Health Care told Becker’s other senior leadership roles are also affected.
31. Bellevue, Wash.-based Overlake Medical Center and Clinicslaid off administrative staff, the health system confirmed to the Puget Sound Business Journal. The layoffs, which occurred earlier this year, included 30 workers across Overlake’s human resources, information technology and finance departments, a spokesperson said, according to the publication. This represents about 6 percent of the organization’s administrative workforce. Overlake’s website says it employs more than 3,000 people total.
32. Columbia-based University of Missouri Health Care is eliminating five hospital leadership positions across the organization, spokesperson Eric Maze confirmed to Becker’s March 20. Mr. Maze did not specify which roles are being eliminated saying that the organization won’t address individual personnel actions. According to MU Health Care, the move is a result of restructuring “to better support patients and the future healthcare needs of Missourians.”
33. Greensboro, N.C.-based Cone Healtheliminated 68 senior-level jobs. The job eliminations occurred Feb. 21, Cone Health COO Mandy Eaton told The Alamance News. Of the 68 positions eliminated, 21 were filled. Affected employees were offered severance packages.
34. The newly merged Greensburg, Pa.-based organization made up of Excela Health and Butler Health Systemeliminated 13 filled managerial jobs. The affected employees and positions are from across both sides of the new organization, Tom Chakurda, spokesperson for the Excela-Butler enterprise, confirmed to Becker’s. The positions were in various support functions unrelated to direct patient care.
35. Crozer Health, a four-hospital system based in Upland, Pa., is laying off roughly 215 employees amid financial challenges. The system announced the layoffs March 15 as part of its “operational restructuring plan” that “focuses on removing duplication in administrative oversight and discontinuing underutilized services.” Affected employees represent about 4 percent of the organization’s workforce.
36. Philadelphia-based Penn Medicine is eliminating administrative positions. The change is part of a reorganization plan to save the health system $40 million annually, the Philadelphia Business Journal reported March 13. Kevin Mahoney, CEO of the University of Pennsylvania Health System, told Penn Medicine’s 49,000 employees last week that changes include the elimination of a “small number of administrative positions which no longer align with our key objectives,” according to the publication. The memo did not indicate the exact number of positions that were eliminated.
37. Sovah Health, part of Brentwood, Tenn.-based Lifepoint Health, eliminated the COO positions at its Danville and Martinsville, Va., campuses. The responsibilities of both COO roles will now be spread across members of the existing administrative team.
38. Valley Health, a six-hospital health system based in Winchester, Va., eliminated 31 administrative positions. The job cuts are part of the consolidation of the organization’s leadership team and administrative roles.
39. Marshfield (Wis.) Clinic Health System said it would lay off 346 employees, representing less than 3 percent of its employee base.
41. Roseville, Calif.-based Adventist Health plans to go from seven networks of care to five systemwide to reduce costs and strengthen operations. The reorganization will result in job cuts, including reducing administration by more than $100 million.
42. Arcata, Calif.-based Mad River Community Hospital is cutting 27 jobs as it suspends home health services.
43. Hutchinson (Kan.) Regional Medical Center laid off 85 employees, a move tied to challenges in today’s healthcare environment.
44. Oklahoma City-based OU Healtheliminated about 100 positions as part of an organizational redesign to complete the integration from its 2021 merger.
45. Memorial Sloan Kettering Cancer Center announced it would lay off to reduce costs amid widespread hospital financial challenges. The layoffs are spread across 14 sites in New York City, and equate to about 1.8 percent of Memorial Sloan’s 22,500 workforce.
46. St. Louis-based Ascensioncompleted layoffs in Texas, the health system confirmed in January. A statement shared with Becker’s says the layoffs primarily affected nonclinical support roles. The health system declined to specify to Becker’s the number of employees or positions affected.
48. Chillicothe, Ohio-based Adena Health System announced it would eliminate 69 positions — 1.6 percent of its workforce — and send 340 revenue cycle department employees to Ensemble Health Partners’ payroll in a move aimed to help the health system’s financial stability.
49. Ascension St. Vincent’s Riverside in Jacksonville, Fla., will end maternity care at the hospital, affecting 68 jobs, according to a Workforce Adjustment and Retraining Notification filed with the state Jan. 17. The move will affect 62 registered nurses as well as six other positions.
50. Visalia, Calif.-based Kaweah Health said it aimed to eliminate 94 positions as part of a new strategy to reduce labor costs. The job cuts come in addition to previously announced workforce reductions; the health system already eliminated 90 unfilled positions and lowered its workforce by 106 employees.
51. Oklahoma City-based Integris Health said it would eliminate 200 jobs to curb expenses. The eliminations include 140 caregiver roles and 60 vacant jobs.
52. Toledo, Ohio-based ProMedica announced plans to lay off 262 employees, a move tied to its exit from a skilled-nursing facility joint venture late last year. The layoffs will take effect between March 10 and April 1.
53. Employees at Las Vegas-based Desert Springs Hospital Medical Center were notified of layoffs coming to the facility, which will transition to a freestanding emergency department. There are 970 employees affected. Desert Springs is part of the Valley Health System, a system owned and operated by King of Prussia, Pa.-based Universal Health Services.
54. Philadelphia-based Jefferson Health plans to go from five divisions to three in an effort to flatten management and become more efficient. The reorganization will result in an unspecified number of job cuts, primarily among executives.
55. Pikeville (Ky.) Medical Center said it would lay off 112 employees as it outsources its environmental services department. The 112 layoffs were effective Jan. 1, 2023.
56. Southern Illinois Healthcare, a four-hospital system based in Carbondale, announced it would eliminate or restructure 76 jobs in management and leadership. The 76 positions fall under senior leadership, management and corporate services. Included in that figure are 33 vacant positions, which will not be filled. No positions in patient care are affected.
57. Citing a need to further reduce overhead expenses and support additional investments in patient care and wages, Traverse City, Mich.-based Munson Health said it would eliminate 31 positions and leave another 20 jobs unfilled. All affected positions are in corporate services or management. The layoffs represent less than 1 percent of the health system’s workforce of nearly 8,000.
58. West Reading, Pa.-based Tower Health on Nov. 16 laid off 52 corporate employees as the health system shrinks from six hospitals to four. The layoffs, which are expected to save $15 million a year, account for 13 percent of Tower Health’s corporate management staff.
59. Sioux Falls, S.D.-based Sanford Healthannounced layoffs affecting an undisclosed number of staff in October, a decision its CEO said was made “to streamline leadership structure and simplify operations” in certain areas. The layoffs primarily affect nonclinical areas.
60. St. Vincent Charity Medical Center in Clevelandclosed its inpatient and emergency room care Nov. 11, four days before originally planned — and laid off 978 workers in doing so. After the transition, the Sisters of Charity Health System will offer outpatient behavioral health, urgent care and primary care.
Minneapolis-based Allina Health System’s move to turn away patients with outstanding debt is a cost-saving measure is not uncommon, according to the Lown Institute.
Allina provides emergency care to indebted patients, but they can be cut off for other services if they have a certain amount of unpaid debt,The New York Times found. A spokesperson for Allina confirmed to the Times that it cut off patients only if they have at least $1,500 of unpaid debt three separate times.
A 2022 investigation from KFF Health News found 55 hospitals allow denials of nonemergency care for patients with medical debt, and 22 said the practice is allowed but not current practice.
Allina’s refusal of care for indebted patients could contribute to medical debt, the Lown Institute said in a June 2 report. Allina is a nonprofit hospital and is required to offer financial assistance to patients who cannot afford services. However, there are no federal regulations regarding how much hospitals have to spend on financial assistance or who can be eligible. When groups refuse care, it can make it harder for patients to get help.
According to the Lown Institute, Allina skirted $266 million in taxes in 2020 from its nonprofit status and spent $57 million on financial assistance and community investment. It could have spent $209 million more to reach its tax exemption value.
HENRY KOTULA 