78 hospitals, health systems cutting jobs

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https://www.beckershospitalreview.com/finance/17-hospitals-health-systems-cutting-jobs-february-2023.html?origin=BHRSUN&utm_source=BHRSUN&utm_medium=email&utm_content=newsletter&oly_enc_id=2893H2397267F7G

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 year and/or take effect later in 2023. 

Editor’s Note: This webpage was updated Aug. 10 and will continue to be updated. Stories are listed under the month they were reported on by Becker’s.

August

The University of Arkansas for Medical Sciences is laying off 51 workers in support services, administration and service lines. Some previously open positions will also be left vacant, the Little Rock-based institution told the Becker’s in a prepared statement. Some job duties will be reassigned. 

Springfield, Ill.-based Memorial Health is laying off hundreds of employees, including 20 percent of leadership positions. Affected employees represent 5 percent of Memorial’s total salary and benefits, according to a statement provided to Becker’s. The cuts focused on system leadership, administrative and support sectors.

Boone Health, a county-owned system based in Columbia, Mo., will cut 62 jobs, most of which are unfilled. Fifteen of the 62 positions are held by existing employees.

The in-home care arm of Syracuse, N.Y.-based St. Joseph’s Health, part of Livonia, Mich.-based Trinity Health, is closing in October, pending the discharge of all patients. The closure includes the termination of 71 employees. Mark McPherson, president and CEO of Trinity Health At Home, said 63 full and part-time positions are being eliminated, while the remaining eight were contingent positions.

July

Chapel Hill, N.C.-based UNC Health will lay off 246 employees. The reduction will occur after the organization ends services at a behavioral health facility in Raleigh on Sept. 30, according to a WARN notice filed July 21 with the North Carolina Department of Commerce. 

Philadelphia-based Jefferson Health is reducing its workforce by about 400 positions. The reduction represents approximately 1 percent of the workforce.

Tupelo-based North Mississippi Health Services is moving forward with layoffs and job reassignments as part of its “redesign” plan to improve the organization’s financial picture, according to a message sent to NMHS employees and affiliated providers July 19. NMHS did not provide the number of affected positions or types of positions affected. 

Allina Health began layoffs affecting about 350 team members throughout the Minneapolis-based organization. The health system said the layoffs began July 17 and that most of the affected jobs are leadership and non-direct caregiving roles.  

Middletown, N.Y.-based Garnet Health laid off 49 employees, including 25 leaders. The reductions represent 1.13 percent of the organization’s total workforce.

June

Coral Gables-based Baptist Health South Florida is offering its executives at the director level and above a “one-time opportunity” to apply for voluntary separation, according to a June 29 Miami Herald report. Decisions on buyout applications will be made during the summer.

MultiCare Health System, a 12-hospital organization based in Tacoma, Wash., will lay off 229 employees, or about 1 percent of its 23,000 staff members, including about two dozen leaders, as part of cost-cutting efforts, the health system said June 29. The layoffs primarily affect support departments, such as marketing, IT and finance.

Greensburg, Pa.-based Independence Health System laid off 53 employees and has cut 226 positions — including resignations, retirements and elimination of vacant positions — since January, The Butler Eagle reported June 28. The 226 reductions began at the executive level, with 13 manager positions terminated in March. 

Billings (Mont.) Clinic will lay off workers as part of a restructuring plan to address financial and operational headwinds in today’s healthcare environment, the organization confirmed. The layoffs are expected to affect approximately 27 or fewer positions. 

Melbourne, Fla.-based Health First is eliminating some positions and leaving open ones vacant, Florida Today reported June 21. Seventeen jobs will be cut and 36 will be left unfilled, according to Paula Just, the health system’s chief experience officer. 

Pittsburgh-based Highmark Health laid off 118 employees on June 21, including two from  Allegheny Health Network, a spokesperson for the health system told Becker’s. The layoffs follow the health system’s cutbacks in March and April, according to the Pittsburgh Business Times. Highmark laid off 141 workers earlier this year.

Vibra Hospital of Western Massachusetts, a long-term-acute care hospital in Springfield, will lay off 87 employees by Aug. 15 ahead of the facility’s planned closure. About 30 patients will be relocated to Baystate Health’s Valley Springs Behavioral Health Hospital in Holyoke, Mass., which will open in August.

Cortez, Colo.-based Southwest Memorial Hospital laid off nine people to help ensure the hospital is staffed appropriately, and create financial stability for the future, a spokesperson confirmed to Becker’s. The spokesperson, Chuck Krupa, said the layoffs occurred June 14 and included administrative workers. No bedside care positions were affected. 

Henry Mayo Newhall Hospital in Valencia, Calif., is making “a little over 100” layoffs amid financial challenges, spokesperson Patrick Moody confirmed to Becker’s. Mr. Moody said the layoffs affect workers “in a wide range of hospital departments.” This includes some management-level employees. The hospital, which has about 1,800 employees total, is not providing specific numbers for specific job titles or departments.

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. 

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.

White Rock (Texas) Medical Center laid off 30 workers across 28 departments. The layoffs include clinical and administrative roles. 

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.

Danville, Pa.-based Geisinger laid off 47 employees from its IT department. The reduction is part of a restructuring plan to offset high labor and supply costs.

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.

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. 

May

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.

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.  

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. 

New Orleans-based Ochsner Health eliminated 770 positions, or about 2 percent of its workforce, on May 11. This is the largest layoff to date for the health system. 

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.

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.

Memorial Health System laid 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. 

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. 

April

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. 

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.

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.

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.

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.

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. 

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.

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.

Tacoma, Wash.-based Virginia Mason Franciscan Health laid 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.

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.

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.

March

Charleston, S.C.-based MUSC Health University Medical Center laid 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. 

Winston-Salem, N.C.-based Novant Health laid 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. 

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.

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.

Bellevue, Wash.-based Overlake Medical Center and Clinics laid 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.

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.”

Greensboro, N.C.-based Cone Health eliminated 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. 

The newly merged Greensburg, Pa.-based organization made up of Excela Health and Butler Health System eliminated 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.

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.

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.

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. 

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. 

Marshfield (Wis.) Clinic Health System said it would lay off 346 employees, representing less than 3 percent of its employee base.

February

St. Mark’s Medical Center in La Grange, Texas, is cutting nearly 50 percent of its staff and various services amid financial challenges. 

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.

Arcata, Calif.-based Mad River Community Hospital is cutting 27 jobs as it suspends home health services.

Hutchinson (Kan.) Regional Medical Center laid off 85 employees, a move tied to challenges in today’s healthcare environment. 

January

Oklahoma City-based OU Health eliminated about 100 positions as part of an organizational redesign to complete the integration from its 2021 merger.

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.

St. Louis-based Ascension completed 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.

Lebanon, N.H.-based Dartmouth Health is freezing hiring and reviewing all vacant jobs at its flagship hospital and clinics in an effort to close a $120 million budget gap. 

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.

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.

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. 

Oklahoma City-based Integris Health said it would eliminate 200 jobs to curb expenses. The eliminations include 140 caregiver roles and 60 vacant jobs.

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. 

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.

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.

December

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.

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. 

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. 

November

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.

St. Vincent Charity Medical Center in Cleveland closed 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.

October

Sioux Falls, S.D.-based Sanford Health announced 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.

How to convince the board that it’s time to merge

Posted on by • Posted in Board, CEO, Health System, Hospital, Hospital Industry, Investing, Investment, Leadership, Leadership Vision, Market Consolidation, Mergers & Acquisitions, Out of Market Growth, Return on Investment, Value Proposition • Leave a comment

https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

This week we had a conversation with a health system executive who has been wondering how to make the case to his board for expansion beyond the existing markets where the organization operates.

Like many, he’s confronting declining margin performance, and feeling pressure to combine with another system—joining the wave of cross-market consolidation that’s been dominating discussion among system CEOs recently.

His concern was that his locally governed board may be putting an artificial brake on growth, not seeing value of expansion beyond their market for the community they serve.

That’s a valid point—how does it help a Busytown resident if the local health system expands to operate in Pleasantville? Shouldn’t Busytown Health System just focus its resources and time on improving performance at home, and wouldn’t it represent a loss to Busytown if Pleasantville got investment dollars that could have been spent locally?

That’s a question raised by the “super-regional” or national strategies being pursued by many large systems today, and one worth thinking about. 

Whenever a system grows outside its geography, there should be a solid argument that additional scale will reap returns for its existing operations, from better efficiency, better access to innovation and talent, better access to capital, or the like.

Those are legitimate reasons for out-of-market growth and consolidation, as long as the systems involved are diligent in pursuing them.

But local boards are right to hold executives accountable for making the case for growth, and ensuring that growth creates value for local patients and purchasers.

Spotting a “skills mismatch” in the nursing pipeline

Posted on by • Posted in Nurse Education, Nurse Licensed Practical (LPN), Nurse Registered (RN), Nurse Staffing, Nurse Training, Nurses, Nurses Shortage, Nursing School, Nursing School Faculty, Nursing Workforce, Recruiting, Retention, Talent Acquisition Strategy, Talent Imperative, Talent Management, Team-Based Care, Team-Based Care Models • Leave a comment

https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

While last week’s graphic looked at how a wave of retirements has hit the nursing workforce, this week we take a look at the pipeline of nurses in training to fill that gap. In recent years, there has been a consistent stream of qualified applicants who want to become BSN nurses, but schools don’t have the capacity to admit them.

One reason: an ongoing shortage of nursing faculty, which recent retirements have exacerbated. The percentage of nursing schools with at least one full-time faculty vacancy grew from 53 percent in 2019 to 62 percent in 2022. 

Looking at registered nurses (RNs), the number with active licenses has continued to grow at a much higher rate than the supply of licensed practice nurses (LPNs) with active licenses. 

The relatively small LPN workforce is especially significant, given rising interest in team-based nursing care, which aims to utilize a higher number of LPNs, supervised by RNs and BSNs.

Expanding training programs with an eye toward the skills and mix needed to deliver team-based care will be critical to ensuring a stable, efficient nursing workforce for future decades.

Are American doctors overpaid? 

Posted on by • Posted in Health Policy, National Bureau of Economic Research (NBER), Physician Compensation, Physicians Per Capita, Supply and Demand • Leave a comment

https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

A recent National Bureau of Economic Research (NBER) working paper analyzed the individual income tax records of 965,000 US physicians between 2005 through 2017 to provide a comprehensive look at physician earnings. As doctors’ incomes are often a combination of wage and business income, earnings are commonly underestimated in survey data. Researchers found that the average physician earned $350K per year, which rose to $405K annually during the prime earning years of ages 40-55. However, researchers found a large gap between the lowest and highest earners: the top ten percent of physicians in that age band averaged $1.3M per year, with those in the top one percent averaging over $4M (and 85 percent of that income coming from business income or capital gains versus wages).  

The Gist: Many policymakers long believed that increasing the number physicians nationally would drive higher medical spending, and worked to constrain supply by freezing funding for residencies in the late 1990s, a move that has yet to be fully unwound. Recent research, however, has found that the impact of physician supply on excess treatment is small or nonexistent.

Meanwhile, the imbalance in supply and demand has led to relatively high prices for physician labor. Compared to other western countries, the US has far fewer physicians per capita, and we pay our doctors significantly more.

Case in point:

Germany has 69 percent more physicians per capita, and American doctors are paid roughly 50 percent more than their German counterparts.

Latest court order pauses No Surprises Act’s Independent Dispute Resolution (IDR) process once again

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https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

This week, the Centers for Medicare and Medicaid Services (CMS) for the second time suspended the arbitration process, outlined in the No Surprises Act, for new out-of-network payment disputes between providers and payers.

Federal judge Jeremy Kernodle in the Eastern District of Texas once again sided with the Texas Medical Association (TMA) in the lawsuit, which challenged CMS’s 2023 increase in administrative fees for arbitration (from $50 to $350), as well as restrictions on batching claims, which require providers to go through a separate IDR process for each claim related to an individual’s care episode. While CMS said that it made these changes to increase arbitration efficiency, TMA argued that the changes made the IDR process cost-prohibitive for providers, particularly smaller practices.

The Gist: Implementing the No Surprises Act has been a huge headache for CMS. Since it went into effect last spring, the IDR has seen a case load nearly 14 times greater than initially estimated, and has been hampered with delays. Insurers have blamed providers for overloading the system with frivolous claims, while providers have accused insurers of ignoring payment decisions determined by third-party arbiters or declining to pay in full. 

The silver lining amid all this infighting is that the No Surprises Act is successfully preventing surprise bills for many consumers, despite the intra-industry turf war over its implementation.

Babylon Health to end US business as proposed go-private deal falls through

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https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

The beleaguered digital health company announced on Monday that its previously proposed arrangement to go private via a deal with Swiss-based neurotechnology company MindMaze will not happen, offering no further details. That deal was arranged by AlbaCore Capital Group, which had secured a loan for Babylon in May to implement the transaction.

Babylon said that it will now exit its core US businesses, which consist mostly of value-based agreements with health plans, and will continue to seek a buyer for its Meritage Medical Network, a California-based independent practice association (IPA) comprised of approximately 1,800 physicians.

Babylon said it may have to file for bankruptcy if it can’t secure additional funding or reach another deal to divest.

The Gist: Babylon is one of the starkest digital health “boom-and-bust” stories thus far. Despite the fact that the company overpromised and under-delivered in both the US and abroad, it was able to raise—and then lose—billions of dollars in just a few short years after going public in October 2021 via a special purpose acquisition corporation (SPAC) merger. It remains to be seen who will buy Babylon’s attractive IPA asset. Presumably insurers, retailers, health systems and other players are evaluating a purchase, either to enter or expand their provider footprint into Northern and Central California.

Weight loss drug Wegovy cuts risk of heart problems by 20 percent

Posted on by • Posted in Cardiology, Cardiovascular Disease, Center for Medicare and Medicaid Services (CMS), Clinical Outcomes, Clinical Research, Health Policy, Medicare Coverage, Wegovy, Weight Loss, Weight Loss Drugs • Leave a comment

https://mailchi.mp/27e58978fc54/the-weekly-gist-august-11-2023?e=d1e747d2d8

On Tuesday, Novo Nordisk released the headline results of a large clinical trial demonstrating that its popular GLP-1 inhibitor Wegovy reduced the risk of heart attacks, strokes, and cardiovascular deaths by 20 percent. The SELECT trial enrolled roughly 17,600 non-diabetic adults aged 45 and older who were overweight or obese with established cardiovascular disease. It compared people in this population treated with the drug to those given a placebo, and tracked them for up to five years. The drugmaker said it plans to release the full trial results at a conference later this year. These results are similar to a previous study that found Wegovy sister drug Ozempic, also made by Novo Nordisk, reduced the risk of adverse cardiac events by 26 percent in adults with type 2 diabetes.

The Gist: The cardioprotective effects demonstrated in this study far exceeded researchers’ expectations. Though concerns still abound about the high costs of Wegovy (nearly $1,350 per month) and similar drugs, these results will certainly put pressure on Medicare and other insurers to provide coverage. 

Questions remain around how the drug actually improves cardiovascular outcomes, and whether patients with cardiac disease who are not overweight or obese might also benefit from taking it.

Despite the fact that the data are still preliminary, the argument that obesity medications are solely “lifestyle” or “vanity drugs”—which some insurers and employers have been using to deny coverage—will now be much harder to defend.

Beyond Hype: Getting the Most Out of Generative AI in Healthcare Today

Posted on by • Posted in Artificial Intelligence, Artificial Intelligence Generative, Charge Capture, Clinical Documentation Improvement (CDI), Cost Management, Cost Reduction, Health System, Hospital, Hospital Industry, Investment, Productivity • Leave a comment

https://www.bain.com/insights/getting-the-most-out-of-generative-ai-in-healthcare/

Generative AI applications can already help health systems improve margins, yet only 6% have a strategy ready.

At a Glance
  • In the wake of their most challenging financial year since 2020, US hospitals are desperately searching for margin improvements.
  • Generative AI can increase productivity and cost efficiency, but only 6% of health systems currently have a strategy.
  • Leading providers and payers will start with highly focused, low-risk generative AI use cases, generating the funds and experience for more transformative future applications.

While Covid-19 may no longer be dominating the global news cycle, healthcare providers and payers are still feeling its reverberations. More than half of US hospitals ended 2022 with a negative margin, marking the most difficult financial year since the start of the pandemic.

CEOs and CFOs remember the challenges all too well: The Omicron surge halted nonurgent procedures in the first half of the year, government support tapered off, and labor expenses ballooned amid staffing shortages. There was also the record-high inflation that continues to intensify margin pressures today. According to a recent Bain survey of health system executives, 60% cite rising costs as their greatest concern.

Payers and providers are now on the hunt for margin improvements. In our experience, the most successful companies won’t merely reduce costs, but also ramp up productivity. When done right, modest technology investments can accomplish both.

Artificial intelligence (AI) may hold part of the answer. With the costs to train a system down 1,000-fold since 2017, AI provides an arsenal of new productivity-enhancing tools at a low investment.

Many executives recognize the growing opportunity, especially with the recent rise of generative AI, which uses sophisticated large language models (LLMs) to create original text, images, and other content. It’s inspiring an explosion of ideas around use cases, from reviewing medical records for accuracy to making diagnoses and treatment recommendations.

Our survey reveals that 75% of health system executives believe generative AI has reached a turning point in its ability to reshape the industry. However, only 6% have an established generative AI strategy.

It’s time to play offense—or be forced to play defense later. But choosing from the laundry list of generative AI applications is daunting. Companies are at high risk of overinvesting in the wrong opportunities and underinvesting in the right ones, undermining future profitability, growth, and value creation. A wait-and-see approach is a tempting prospect.

However, we believe the next generation of leading healthcare companies will start today, with highly focused, low-risk use cases that boost productivity and cost efficiency. Over the next three to nine months, these companies will improve margins and learn how to implement a generative AI strategy, building up the funds and experience needed to invest in a more transformative vision.

Endless potential—and high hurdles 

The excitement around generative AI may feel akin to the hype around other recent digital and technology developments that never quite rose to their promised potential. Well-intentioned, well-informed individuals are debating how much change will truly materialize in the next few years. While developments over the past six months have been a testament to the breakneck speed of change, nobody can accurately predict what the next six months, year, or decade will look like. Will new players emerge? Will we rely on different LLMs for different use cases, or will one dominate the landscape?

Despite the uncertainty, generative AI already has the power to alleviate some of providers’ biggest woes, which include rising costs and high inflation, clinician shortages, and physician burnout. Quick relief is critical, considering that the heightened risk of a recession will only compound margin pressures, and the US could be short 40,800 to 104,900 physicians by 2030, according to the Association of American Medical Colleges.

Many health systems are eyeing imminent opportunities to reduce administrative burdens and enhance operational efficiency. They rank improving clinical documentation, structuring and analyzing patient data, and optimizing workflows as their top three priorities (see Figure 1).

Figure 1

In the near term, generative AI can reduce administrative burdens and enhance efficiency

Some generative AI applications are already streamlining administrative tasks and allowing thinly stretched physicians to spend more time with patients. For instance, Doximity is rolling out a ChatGPT tool that can draft preauthorization and appeal letters. HCA Healthcare partnered with Parlance, a conversational AI-based switchboard, to improve its call center experience while reducing operators’ workload. And there are new announcements seemingly every week: Consider how healthcare software company Epic Systems is incorporating ChatGPT with electronic health records (EHRs) to draft response messages to patients, or how Google Cloud is launching an AI-enabled Claims Acceleration Suite for prior authorization processing. 

These applications only scratch the surface of potential. In the future, generative AI could profoundly transform care delivery and patient outcomes. Looking ahead two to five years, executives are most interested in predictive analytics, clinical decision support, and treatment recommendations (see Figure 2).

Figure 2

Predictive analytics, clinical decisions, and care recommendations are long-term generative AI priorities

It’s hard not to catch AI “fever.” But there are real challenges ahead. Some are already tackling the biggest questions: Organizations such as Duke Health, Stanford Medicine, Google, and Microsoft have formed the Coalition for Health AI to create guidelines for responsible AI systems. Even so, solutions to the greatest hurdles aren’t yet keeping up with the rapid technology development.

Resource and cost constraints, a lack of expertise, and regulatory and legal considerations are the largest barriers to implementing generative AI, according to executives (see Figure 3).

Figure 3

A lack of resources, expertise, and regulation are the biggest barriers to generative AI in healthcare

Even when organizations can overcome these hurdles, one major challenge remains: focus and prioritization. In many boardrooms, executives are debating overwhelming lists of potential generative AI investments, only to deem them incomplete or outdated given the dizzying pace of innovation. These protracted debates are a waste of precious organizational energy—and time. 

Starting small to win big 

Setting the bar too high is setting up for failure. It’s easy to get caught up, betting big on what seems like the greatest opportunity in the moment. But 12 months later, leaders often find themselves frustrated that they haven’t seen results or feeling as if they’ve made a misplaced bet. Momentum and investments slow, further hindering progress. 

Leading companies are forming a more pragmatic strategy that considers current capabilities, regulations, and barriers to adoption. Their CEOs and CFOs work together to enforce four guiding principles: 

  • Pilot low-risk applications with a narrow focus first. Tomorrow’s leaders are making no-regret moves to deliver savings and productivity enhancements in short order—at a time when they need it most. Gaining experience with currently available technology, they are testing and learning their way to minimum viable products in low-risk, repeatable use cases. These quick wins are typically in areas where they already have the right data, can create tight guardrails, and see a strong potential return on investment. Some, like call center and chatbot support, can improve the patient experience. However, given the current challenges around regulation and compliance, the most successful early initiatives are likely to be internally focused, such as billing or scheduling. Most importantly, executives prioritize initiatives by potential savings, value, and cost.
  • Decide to buy, partner, or build. CEOs will need to think about how to invest in different use cases based on availability of third-party technology and importance of the initiative.
  • Funnel cost savings and experience into bigger bets. As the technology matures and the value becomes clear, companies that generate savings, accumulate experience, and build organizational buy-in today will be best positioned for the next wave of more sophisticated, transformative use cases. These include higher-risk clinical activities with a greater need for accuracy due to ethical and regulatory considerations, such as clinical decision support, as well as administrative activities that require third-party integration, such as prior authorization.
  • Remember generative AI isn’t a strategy unto itself. To build a true competitive advantage, top CEOs and CFOs are selective and discerning, ensuring that every generative AI initiative reinforces and enables their overarching goals.

Some health systems are already seeing powerful results from relatively small, more practical investments. For instance, recognizing that clinicians were spending an extra 130 minutes per day outside of working hours on administrative tasks, the University of Kansas Health System partnered with Abridge, a generative AI platform, to reduce documentation burden. By summarizing the most important points from provider-patient conversations, Abridge is improving the quality and consistency of documentation, getting more patients in the door, and cutting down on pervasive physician burnout.

Although it will require some upfront investment, in the long run it will be more costly to underestimate the level and speed at which generative AI will transform healthcare. The next generation of leaders will start testing, learning, and saving today, putting them on a path to eventually revolutionize their businesses.

45 hospitals closing departments or ending services

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A number of healthcare organizations have recently closed medical departments or ended services at facilities to shore up finances, focus on more in-demand services or address staffing shortages.

Here are 45 closures or services ending, announced, advanced or finalized that Becker’s has reported since Feb. 2:

1. Vicksburg, Miss.-based Merit Health River Region closed its behavioral health unit on June 30.

2. Wilkes-Barre (Pa.) General Hospital moved up the date it planned to end childbirth services by about three weeks, with the care ending abruptly July 11. 

3. Good Samaritan Hospital, operated by Nashville, Tenn.-based HCA Healthcare, plans to close the inpatient psychiatric facility at its Mission Oaks Hospital in Los Gatos, Calif., on Aug. 20.

4. Philadelphia-based Penn Medicine shut down one of its urgent care centers, Penn Urgent Care South Philadelphia, on June 30, as more patients are turning to telehealth for care.

5. Hartford City, Ind.-based IU Health Blackford Hospital announced it will close its emergency department and no longer offer inpatient services due to a reduction in patient volume.

6. The Illinois Health Facilities and Services Review Board on June 27 unanimously approved a request from HSHS St. Mary’s Hospital to shutter four of its units. The Decatur, Ill.-based hospital will wrap up its advanced inpatient rehabilitation, obstetrics and newborn nursery, pediatrics and inpatient behavioral health services. 

7. Albany, N.Y.-based St. Peter’s Health Partners submitted a plan to the state Department of Health to shut down the maternity unit at Samaritan Hospital. If approved, the Troy, N.Y., hospital will close the unit in about four to six months.

8. Jackson, Miss.-based St. Dominic Health Services is ending its behavioral health services unit, citing financial difficulties. The unit stopped taking admissions after June 6. 

9. Fort Wayne, Ind.-based Lutheran Hospital is closing its heart transplant and inpatient burn units due to low patient volumes. The inpatient burn unit stopped accepting new patients June 2. 

10. Worcester, Mass.-based UMass Memorial Health plans to close the maternity ward at its HealthAlliance-Clinton Hospital Sept. 22 due to staff shortages and a declining number of births in the area. 

11. Vancouver, Wash.-based PeaceHealth closed its pediatric cardiology clinic, sleep clinic, optometry clinic and optical shop July 21. It also ended its comprehensive outpatient palliative care May 26 and reduced staff to one nurse and one social worker for in-home care.

12. Milwaukee-based Froedtert closed the behavioral health unit at Froedtert Menomonee Falls (Wis.) May 12. 

13. Welch (W.Va.) Community Hospital announced plans to close its long-term care unit. The closure of the 59-bed unit is part of the hospital’s transition to the West Virginia University Health System.  

14. Peoria, Ill.-based OSF HealthCare is closing its labor and delivery services at OSF Heart of Mary Medical Center in Urbana, Ill. Starting in September, labor and delivery patients will be redirected to OSF Sacred Heart Medical Center in Danville, Ill. or OSF St. Joseph Medical Center in Bloomington, Ill.

15. Northern Maine Medical Center in Fort Kent closed its obstetrics unit May 26. The move comes as birth rates decline in the area along with staffing trouble. 

16. Philadelphia-based Jefferson Health ended acute care, general surgery and emergency services at Einstein Medical Center Elkins Park (Pa.) and convert the facility solely into a physical rehabilitation provider. 

17. CoxHealth closed the labor and delivery unit at Cox (Mo.) Monett Hospital, citing difficulties recruiting obstetricians and family practice physicians.

18. Warsaw, N.Y.-based Wyoming County Community Health System ended its birthing services June 1 amid financial challenges and declining births in the area.

19. Alta Vista Regional Hospital in Las Vegas, N.M., ended intensive care unit services June 3. The hospital said the change would allow it to focus on its highly utilized medical-surgical unit. 

20. Springfield, Ore.-based McKenzie-Willamette Medical Center closed its maternity health practice July 7. The for-profit McKenzie-Willamette hospital said the 11-employee midwifery program was “unsustainable.”

21. Renton, Wash.-based Providence ended labor and delivery at Petaluma (Calif.) Valley Hospital May 1 until further notice.

22. Gardner, Mass.-based Heywood Hospital closed its pulmonary unit in mid-April due to financial reasons.

23. Yale New Haven (Conn.) Hospital “ceased use” of its emergency use annex April 11 amid discussions to extend its certificate of occupancy. 

24. Chelsea (Mich.) Hospitalclosed its inpatient behavioral health unit and moved 12 of its beds to Trinity Health Ann Arbor.

25. Danbury, Conn.-based Nuvance Health closed Thompson House, a 100-bed rehabilitation facility in Rhinebeck, N.Y., and laid off its 102 employees, effective April 12.

26. Holly Springs, Miss.-based Alliance HealthCare System began transitioning to rural emergency hospital status March 31, meaning it will end all inpatient care services. 

27. MercyOne North Iowa closed its hospice facility in Mason City April 17 amid industry pressures of inflation and high labor costs. 

28. Brewer, Maine-based Northern Light Health is no longer providing cataract, glaucoma and oculoplastic surgeries at Eastern Maine Medical Center in Bangor. 

29. Plymouth, Ind.-based St. Joseph Health System closed its New Beginnings Birthplace center because it has been unable to attract an obstetrician. It also closed its OB-GYN office March 31.

30. Springfield, Mass.-based Baystate Health and medical services provider Shields Health closed their urgent care clinic locations in Feeding Hills, Longmeadow and Westfield, Mass., on March 31. 

31. Palomar Medical Center Poway (Calif.), part of Escondido, Calif.-based Palomar Health, closed its labor and delivery unit, at least temporarily, in June. 

32. A combination of a loss of pediatricians, changing demographics and some of the strictest abortion laws in the country forced Sandpoint, Idaho-based Bonner General Hospital to end obstetrics services. 

33. Cabell Huntington (W.Va.) Hospital, part of Mountain Health Network, closed its CHH Surgery Center April 28 and is phasing out its home health services to better align its resources and reduce costs amid financial headwinds.

34. The only hospital in Manitowoc, Wis., a city of nearly 35,000 — Froedtert Holy Family Memorial Hospital — stopped all obstetrics care June 1.

35. Citing a lack of provider coverage, Ocean Springs, Miss.-based Singing River Health System said it would end obstetric services, which include labor and delivery, at Singing River Gulfport (Miss.), at least temporarily. The move became effective April 1. 

36. Astria Toppenish (Wash.) Hospital is one of many rural hospitals closing labor and delivery care due to costs, creating maternity deserts in areas that need care most, The New York Times reported.

37. Cleveland-based University Hospitals ended labor and delivery services at UH Lake West in Willoughby, Ohio, April 15. The hospital said services would be consolidated at TriPoint in Concord Township, which is about 15 miles away.

38. Jefferson, Mo.-based Capital Region Medical Center closed two clinics in Holts Summit and St. Elizabeth, Mo., April 15. 

39. In February, Trinity Health Muskegon (Mich.) announced plans to temporarily close a 30-bed surgical floor due to staffing shortages. 

40. St. Mark’s Medical Center in La Grange, Texas, cut nearly half its staff and various services as it looks to survive amid significant financial challenges. Service cuts include inpatient and surgical services, post-acute skilled rehab care, its orthopedic clinic, speech therapy and ambulatory care.

41. OhioHealth’s Shelby Hospital stopped providing maternity services Feb. 28. Maternity services are provided 13 miles away at OhioHealth Mansfield Hospital.

42. Arcata, Calif.-based Mad River Community Hospital cut 27 jobs as it suspends its home health services program. The program will be suspended upon the completion of services to the hospital’s existing patients, which was expected to be in April.

43. Oroville (Calif.) Hospital closed Golden Valley Home Health, the hospital’s home health business. 

44. Ascension Providence Hospital-Southfield (Mich.) ended midwifery services in February. 

45. Rumford (Maine) Hospital closed its maternity program March 31 after 97 years in service.