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Greensburg-based Excela Health to lay off 78 workers, leave 58 jobs unfilled

| Saturday, July 13, 2013, 12:01 a.m.

Excela Health announced on Friday that it is laying off 78 employees and will leave another 58 positions vacant as the Greensburg-based health system tries to cut costs while coping with a drop in admissions, a spokeswoman said.

“Like many health systems, Excela Health is experiencing a steady decline in hospital admissions,” Robin Jennings said in a statement.

Just a day earlier, officials denied that layoffs were in the offing, but when word leaked out about the furloughs, Excela released a statement explaining the reasons behind the decision.

Jennings said employees will receive a severance package and “some transitional support.”

She confirmed that the system suffered “operational losses” for the current fiscal year. Administrators would not reveal the size of those deficits, saying investment income enabled Excela to offset the losses.

“The good news is that even with our potential operational loss in 2013, our net income was positive and improved over 2012, based upon our strength of our investment portfolio,” Jennings said.

Administrators said they will not know the extent of the losses until September when an audit is completed.

Jennings said the health system was able to save $8 million by cutting costs of supplies, contracts and services for non-staff functions.

“We have also reduced the workforce to remain on par with our volume and revenue trends,” she added.

Like other community hospitals, Excela has had financial problems because of changes in health care, higher costs, declining reimbursements and an increase in unpaid health care it is required to provide to the public.

Excela has experienced internal upheaval from an estimated 60 physicians who formed their own specialty practice to force changes in how the health care system is staffed and operated.

The physicians have resisted pressure from Excela to sign on as employees, preferring to remain independent. The doctors who are members of the new Westmoreland Multi-Specialty Group say they are responsible for about 60 percent of admissions to Excela's Greensburg hospital.

Excela administrators are trying to prevent the physicians from joining competing health care giants, UPMC and the newly created Allegheny Health Network, which was formed earlier this year after the merger of the West Penn Allegheny Health System and Highmark Blue Cross Blue Shield.

Richard Gazarik is a staff writer for Trib Total Media. He can be reached at 724-830-6292 or atrgazarik@tribweb.com.

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