MACOMB — Citing a “steep decrease in revenue in relation to the COVID-19 pandemic”, McDonough District Hospital announced a “reduction in force” and furlough plan that will affect 60 employees. According to a release Monday evening (April 20), the plan went into effect on April 17. Most of the affected employees will be furloughed, according to the release, representing “the efforts to adjust staffing and related operating costs to the level of patient activity MDH is currently experiencing.”
The release quotes President/CEO Brian E. Dietz, FACHE, who said nearly 83 percent of the hospital’s revenue stream derives from outpatient services, which have been largely curtailed during the COVID-19 pandemic. Dietz said the hospital had to cancel 78 elective surgeries in the last 11 days of March at a cost of $1.2 million in lost revenue.
“For the month of April we have every reason to expect the same result but at a much higher loss since it will be for a full month,” Dietz said.
“Without elective surgeries and the related supportive ancillary services, the net revenue for MDH will and has dropped precipitously to a level of not supporting our current operations.”
According to the release, employees covered by health insurance will receive those same benefits through June 30. Those in the reduction-in-force category will also receive reimbursement for all accrued vacation pay along with a severance package for those who are eligible. MDH will cover 100 percent of the monthly health insurance premium for furlough employees and those affected by the reduction-in-force. Furloughed employees will be the first ones called back when circumstances allow, according to the release.
“This is a stressful time for MDH,” Dietz said. “Though I am confident we will make it (through) this, the uncharted waters we are navigating leaves a lot of uncertainty for all of us in determining what the future brings and what we will have to do to adjust to change.”
Dietz said, “It is our hope that with the ‘Opening Up America Again’ initiative, the PPE (personal protective equipment) supply will be sufficient to allow us to safely care for all of our patients, both inpatient and outpatient, without the risk of running out of vitally important PPE for our colleagues. All of us at MDH will be excited to call back our incredible staff so we can restore operations to the ‘new normal’ as soon as possible.”
The release did not identify which departments at MDH would feel the brunt of the layoffs and furloughs or whether affected employees have yet been notified.