Greenwood Leflore Hospital is laying off 30 employees, including an undisclosed number of physicians, as part of an effort to reduce its continued losses.
Most of the impacted employees were notified Tuesday, but some may not get the news until next month, according to Jason Studley, the hospital CEO.
The layoffs represent less than 4% of the hospital’s current employment, which stood at 799 as of Tuesday. Another 100 work for Aramark, the private contractor that handles laundry, housekeeping, maintenance and food services at the hospital.
The layoffs came a week after Studley publicly acknowledged that the hospital was running out of cash and would have to take “drastic measures” to keep its doors open.
“I hate it, but it’s the reality of where we are in rural health care, and it needs to be done,” Studley said Tuesday, shortly before the first employees were notified that their jobs were being eliminated. “We need to move forward and maintain that we stay viable for serving the community as the health care provider.”
He said the cuts would not eliminate any of the specialties the Greenwood hospital currently provides.
In addition to the workforce reductions, the hospital is eliminating “COVID incentive pay,” the expensive supplements that had been added to certain positions, especially nurses, in order to retain and hire skilled medical employees during the pandemic.
Those incentives were made affordable by the $32.6 million in coronavirus relief money the hospital received, mostly from the federal government, but those grants have been largely exhausted.
A third major cost-cutting measure is the elimination of additional pay to most specialist physicians for being on call for emergencies beyond the 10 days required per month under the medical staff bylaws. The specialists can still volunteer to take additional call days, which could eventually earn them bonuses under their contracts with the hospital, Studley said.
He said that obstetrics and gynecology as well as pediatrics would continue to have doctors on call around the clock, but other specialties could see limited call coverage on some days.
Combined, the cost-cutting measures are projected to save $10 million annually.
The spending cuts are designed to buy some time as the publicly owned hospital weighs its options, including the possibility of affiliating with a larger medical institution.
On Tuesday, the hospital released its April financial statements, which showed a $1.9 million loss last month. Although that was significantly better than the $3.1 million loss in March, the hospital’s cash reserves still suffered a $1.6 million hit, falling to $16.6 million. Of that total, $9.8 million is in the form of a loan from the federal Medicare program. The hospital is having to pay back those advance Medicare payments at the rate of about $1 million a month.
The hospital in 2021 had implemented an earlier round of spending reductions that have trimmed expenses by nearly $5 million, or 6.8%, for the first seven months of the current budget year. The savings, though, have not been enough to offset the still sluggish stream of patients, particularly for elective surgeries that require overnight stays. Net patient revenue for the fiscal year is down $5.4 million from the same time period a year ago and $6.9 million behind where it stood the year before that.
Studley had announced last week that the 208-bed hospital was limiting its inpatient capacity to 31 beds, more in keeping with what had been its current daily average of 40.
He said Tuesday that he does not anticipate additional job cuts as long as patient numbers don’t deteriorate further.
The involuntary reductions were the first ones the hospital has implemented since Studley came on board as CEO in October 2020. Previously, he had been able to eliminate positions through attrition, not filling some jobs when the employee retired or accepted employment elsewhere.
Since June 2021, according to Studley, 70 full-time-equivalents had been eliminated through attrition. Full-time equivalents, or FTEs, measure the total number of full-time employees an employer has based on hours worked rather than the exact number of employees. For example, two part-time employees each working 20 hours equal one FTE.
“With the cash situation of the hospital, we were not able to avoid having to make more immediate and drastic reductions in our workforce at this point in time,” he said.
- Contact Tim Kalich at 662-581-7243 or tkalich@gwcommonwealth.com.
