West Penn Allegheny hospitals to lay off 262, cut 200 open positions
By Alex Nixon
Published: Friday, July 26, 2013, 11:30 a.m.
Highmark's Allegheny Health Network is laying off 262 workers and eliminating 200 open positions at its West Penn Allegheny hospitals as it seeks to match staffing levels to lower patient volume, the hospital system said Friday.
It is the second cost-cutting move this week as Allegheny Health Network focuses on repairing the financial health of West Penn Allegheny, which Highmark acquired in April and forms the backbone of the network that is preparing to compete with UPMC.
“Although extremely difficult, today's workforce reduction is an essential step in our efforts to right-size the organization for the patient volume we currently have, and to strongly position it for future growth and success as a leading healthcare provider in the region,” spokesman Dan Laurent said.
The system doesn't anticipate further layoffs, Laurent said.
The Service Employees International Union, which represents about 2,000 workers at West Penn Allegheny hospitals, said it was disappointed by the layoffs.
“Because SEIU Healthcare Pennsylvania employees are part of a union, they have contractual rights and a voice in this process,” spokeswoman Amelia Abromaitis said. “We fully expect the health system to work with us to minimize the adverse impact on the Allegheny Health Network workforce.”
Linda Thrower, a registered nurse at Allegheny Valley Hospital, was not at the hospital when layoffs were announced and hadn't learned her fate.
“If they lay me off, they lay me off,” said the New Kensington woman who's worked at the hospital for 33 years. “There's not much really I can do about that.”
The Tribune-Review this week reported that Allegheny Health Network on Monday laid off the CEO of Allegheny Valley Hospital, Ned Laubacher, after four years at the Natrona Heights hospital's helm, in what Laurent called an effort to streamline operations. Additionally, two executives from Forbes Regional Hospital in Monroeville were let go.
Separately, Daniel Lebish, chief financial officer of Allegheny Health Network and a key executive involved in guiding health insurer Highmark's move into the hospital business, resigned to take a position at Columbus, Ga.-based insurer Aflac Inc., Laurent said.
Lebish couldn't be reached. Laura Kane, an Aflac spokeswoman, could only confirm that Lebish had been hired but hadn't started work yet. She declined to say what his position will be.
The latest layoffs are spread across West Penn Allegheny's five hospitals, Allegheny General, Allegheny Valley, Canonsburg General, Forbes Regional and West Penn, and its corporate ranks.
Laurent declined to give a hospital-by-hospital breakdown. He said the layoffs “span every level of the workforce, but relatively few are related to direct patient care.”
Following the layoffs, West Penn Allegheny will have 10,300 workers. Allegheny Health Network, which also includes Jefferson Regional Medical Center in Jefferson Hills and St. Vincent Health System in Erie, employs nearly 17,000 people.
The cuts don't affect Jefferson Regional and St. Vincent.
West Penn Allegheny's financial losses have been growing as patient volumes decline and expenses increase. In the January-March quarter, the system's operating loss grew to $37.7 million, up from $23.9 million the year before. During the quarter, revenue dropped by $10 million, and expenses jumped by $2.4 million.
West Penn Allegheny hospitals recorded 40,483 discharges in the nine months ended March 31, a 4 percent decline from 42,075 discharges in the same period last year. Officials have said the decline could be partly blamed on the opening of UPMC East in Monroeville last year, which took patients from Forbes Regional.
Laurent said progress is being made in several areas to improve the system's financial performance, including reducing of non-personnel expenses, improving management of billing and collections, and making operations more efficient.
“Today's action is just one component of a comprehensive strategy to strengthen the network's financial position,” he said.
Trib Total Media staff writer Brian C. Rittmeyer contributed. Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or email@example.com.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Marcellus shale driller Noble Energy Inc. sinks roots into Pittsburgh
- ‘Fresher, different, lot more fun’ guide changes at Kings Family Restaurants
- Sbarro again files for bankruptcy reorganization
- EBay shareholders urged to reject Icahn picks
- Weather worsens McDonald’s sales struggles
- 1,500 Bangladesh factories set to be inspected by August
- Stocks dip on gloomy data from Asia
- CVS suit could be test case
- JPMorgan whistle-blower gets $64M for mortgage fraud tips
- Regular IRA or Roth? Pick either
- Municipal bonds do another about-face