Mercy Health Announces 61 Layoffs, End Of Outpatient Therapy
Last updated Friday, October 3, 2008 7:56 PM CDT in News
By Caleb Fort
THE MORNING NEWS
ROGERS -- Mercy Medical Center officials announced Friday 61 employees will be laid off, including 41 full-time workers.
As part of the layoffs, the medical center will close its outpatient therapy program, which provides physical, speech and occupational therapy to about 400 patients.
Closing the program will eliminate 20 positions.
"This is a tough day -- a dark day for us," said Jon Vitiello, the chief operating officer of Mercy Health System of Northwest Arkansas.
Hospital officials realized they had to make cuts about three weeks ago, after determining Mercy was losing money, Vitiello said.
He would not discuss the specifics of Mercy's financial situation or how much money the hospital will save with the layoffs.
However, he said the cuts will be enough to bring Mercy's revenue back in line with expenses.
In a news release, Mercy CEO George Flynn said charity care and bad debt drove Mercy to make the cuts. In the most recent fiscal year, Mercy spent $3.8 million more on charity care and bad debt than in the previous year, Flynn said.
"Given the economic realities of the current health care environment ... it is our fiduciary duty to manage our business and financial position while remaining true to our mission in Northwest Arkansas," Flynn said in the release.
Friday's layoffs, combined with two rounds of layoffs in June, bring the total this year to 104 employees.
When asked about future layoffs, Vitiello said there are no plans for more cuts.
"The other way I would answer that is I can't predict what other events are going to hit the hospital," he said.
No doctors or nurses were laid off in Friday's action, Vitiello said.
Apart from the therapy patients, Mercy patrons should not see any difference in service, he said.
Over the next 30 days, Mercy will work to transfer the therapy patients and employees to other local programs, Vitiello said.
Mercy moved into a $70 million, 200-bed campus in March. The 350,000-square-foot hospital is on Rife Medical Lane near New Hope Road and Interstate 540.
"The deterioration of our revenues is not something we anticipated," Vitiello said. "It was bad timing."
But Mercy will still be able to use the campus to its full capacity, because it was constructed to use labor more efficiently, Vitiello said.
Vitiello said the hospital's difficult financial situation is indirectly linked to the nation's slow economy.
"With rising gas prices and food, they have less dollars left to pay the medical bills," Vitiello said. "We've moved down the list of what people have to pay for."
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mafm wrote on Oct 5, 2008 12:06 PM: