UPDATE: Wyoming Medical Center Lays Off 58 Staff; Total Cuts Amount To 9 Percent Of Workforce
The Wyoming Medical Center laid off 58 employees and won't fill 57 vacant positions to save $7.2 million in its next fiscal year, hospital officials said Tuesday morning during a news conference.
A series of mounting financial pressures over the past few months forced the hospital to make this decision to trim its workforce by 9 percent, its president Vickie Diamond said.
"Today we completed a reduction in force affecting 58 employees," Diamond said.
"The affected workers have been notified," she said. "We have offered a compensation package including 60 days of pay, access to counseling, and will connect them to career transitions and community service."
Hospital officials began notifying the employees at 7 a.m. and finished by 11 a.m.
The layoffs put the Wyoming Medical Center's work force in line with other hospitals in similar size and scope, and allows it to be more competitive, Diamond said.
But it's not easy, she said. "This has been a hard day for everyone at Wyoming Medical Center. All affected employees were skilled professionals as well as valued co-workers and friends."
The layoffs do not affect direct patient care, she said. No bedside care nurses were laid off, she said.
The jobs lost were in a variety of departments including finance, materials management, sterile processing, radiology and staff services. The administration has reduced its workforce about 15 percent in recent months, and the remaining employees have taken 2 percent pay cuts, Diamond said.
Chief Financial Officer Yvonne Wigington said about 1,000 employees remain.
Wigington cited several factors forcing the layoffs.
The hospital had operating losses in five of the first 10 months of its 2015-2016 fiscal year, she said. Operating margins broke even in two months. One of the three months that showed revenues in excess of expenses was the result of an incentive from Medicare.
Meanwhile, operating expenses increased 8.5 percent.
The hospital also has seen a change in how it is reimbursed and a demographic change as well, Wigington said.
Twenty-nine percent of the patients are covered by insurance or pay their bills directly, meaning the hospitals costs are covered.
But for 71 percent of the patients, the payer sources do not cover all the costs, she said. Those sources are Medicare (the federal health insurance program for the elderly), Medicaid (the federal health insurance program for the poor), and other programs such as Workers' Compensation.
Of that 71 percent, 48 percent comes from Medicare -- up from 44 percent the previous year. Eight percent comes from Medicaid. The hospital writes off another 10 percent in uncompensated care -- the combination of charity care and bad debt, and the rest comes from other programs.
The hospital will write off about $55.1 million in uncompensated care by the end of the fiscal year on June 30, which is more than it had budgeted, she said.
To stem the losses, Wigington said the hospital administration asked all departments to reduce their operating expenses by 10 percent for a goal of $10.7 million. The hospital is now at $8.4 million.
She doesn't anticipate a change in Medicare reimbursement or an immediate improvement in the energy sector, and so the hospital had to act to avoid further losses.
"The simple fact is the Wyoming Medical Center can no longer afford these positions," she said.
The nonprofit Wyoming Medical Center Inc., was formed in 1986.
Until then, it was known as the Memorial Hospital of Natrona County, which was owned and operated by Natrona County. After the creation of the WMC, the county continued to own the physical plant of the hospital, which is mostly in the 1200 blocks of East Second and Third streets. The WMC leases the property from the county to do health care. The WMC's rent, in effect, is to maintain the value of the physical plant and provide care for the indigent.
A five-member board of trustees -- called the Memorial Hospital of Natrona County -- oversees the WMC's lease of the county's property.