WENATCHEE — Central Washington Hospital will lay off about 80 employees in the next three weeks as part of a plan to cut $7 million from its $180 million annual budget by the end of the year.
It’s the second round of layoffs at North Central Washington’s largest hospital since the 2008 recession began, said Chief Operating Officer John Hamilton.
The hospital has about 1,400 employees. They were told Friday about the coming cuts.
“Our business is down, our reimbursements are down, and our charity care is up, and that’s a bad combination,” Hamilton said. With predictions for a continued sluggish economy, he said, “We feel we have to right-size, or re-size our organization now.”
He said the hospital hopes to offset the impact by offering voluntary early retirement to workers who are 60 years or older, and by not filling vacancies from retirements or departures. The hospital hopes to decide next week whether to offer an early retirement, but if it does, it’s not clear how many would want to participate, he said.
“We do have a lot of good people, and a lot of resilience. It’ll be tough, but we’ll be there at the end,” he said of the cuts.
The cuts are necessary due to the poor economy, along with major reductions in Medicare and Medicaid reimbursements.
“This is not a result of building the tower,” Hamilton said. The $124 million expansion of the hospital was recently completed, and will be paid for by community donations, cash reserves and an $80 million bond, to be repaid over the next 30 years.
Hamilton said hospital facilities were too old, and too small, and technologically outmoded. He said when the tower was built, the hospital was turning away patients. Now, patient volumes have dropped as workers are laid off and lost their health insurance, adding to the hospital’s economic woes.
“We have an excellent staff and our people and staff deserved a facility that matched their skills and needs,” he said.
Hamilton said the hospital will also look to cutting costs and boosting revenue, but most of the budget reduction will come from layoffs.
“It’s a lot, and these are all people. It’s just a tough thing to do,” he said.
The hospital will not be making cuts that would impact bedside care, Hamilton added.
“That’s where the most important activities take place. We will concentrate on overhead and non-clinical areas,” he said of the cuts.
The first round of layoffs occurred early last year, but Hamilton said he did not know how many workers were let go.
K.C. Mehaffey: 997-2512