CHARLESTON, W.Va. — Charleston Area Medical Center announced today that weakening economic conditions mean it must cut 300 jobs by the end of 2017.
“These are difficult economic times for our region and our health care delivery system across southern West Virginia. After the first five months of 2017, CAMC operations were on course to lose more than $40 million in 2017,” the hospital network stated in an announcement about the eliminated jobs.
The statement continued, “These decisions were not made lightly, but it is CAMC’s obligation as the largest provider of critical care in our region to remain sustainable for the future.”
Since January, CAMC has not filled any open non-clinical positions — accounting for 56 of the 300 positions.
“In addition, we anticipate that attrition will take care of another 75 or so positions,” the hospital network stated. “Human resources is working with each employee affected to attempt to place them in an appropriate open position within CAMC.”
Charleston Area Medical Center, with about 7,000 employees, has been among West Virginia’s largest private employers. It has been within the top three among West Virginia employers for more than a decade, according to Workforce West Virginia.
The hospital network includes Memorial Hospital, General Hospital and Women’s and Children’s Hospital plus CAMC-Teays Valley Hospital. CAMC is also a teaching institution with a standing relationship with West Virginia University.
In an emailed statement, Senator Joe Manchin offered support as CAMC works through its economic issues.
“This terrible news should be a rallying cry for everyone that it is time to come together to solve the problems facing our healthcare system. West Virginians know better than anyone how to overcome tough problems by working together,” Manchin stated.
“People’s lives and livelihoods depend on us putting party aside to do what is right for the people of West Virginia. I have spoken to leadership at the CAMC, and assured them that I will do everything in my power to help reverse this difficult and unfortunate decision.”
The hospital said several factors are contributing to economic struggles.
Its statement cited increased reliance on governmental payors such as Medicare, Medicaid and PEIA that reimburse below the actual cost to deliver care. Commercially-insured patients now make up only 17 percent of CAMC’s payor mix, the hospital stated.
Other economic factors cited by CAMC include a decrease in Medicare reimbursement under the Affordable Care Act, increased costs of drugs and technology, a statewide nursing shortage that requires CAMC to employ more expensive agency labor and the cost of electronic health records conversion.
Earlier this year, the nonprofit CAMC established a goal of earning a $20 million profit — turning the money back over for improvements. The hospital network was discussing cuts to programs but, at the time, had no plans to trim employment.
CAMC stated that over the past few months it has tried to lower some of its expenses in several ways.
It has realigned its dental and fertility centers with other programs, it has dropped its Dean Ornish wellness program, it has plans to close the CAMC Pharmacy at Cross Lanes, the pulmonary rehab program will close this October, and The Lighthouse day care will close by July 2018, a date meant to give the effected employees and physicians one year to find alternate day care and pre-school.
Since February, CAMC stated, there has been a team working diligently to improve access to inpatient services. That work will continue and is expected to lead to additional revenue opportunities.
“We will also be requiring that each department and cost center maintain 100 percent productivity beginning on August 1, 2017,” CAMC chief executive officer David Ramsey said in a video message distributed by the hospital network today.
“While we have been working toward the goal for several years, not all departments have reached it or maintained it in the past. Now, everyone must do so.”
In the video message, Ramsey discusses a broad picture of challenges facing health care providers. He says rising costs, accessibility, aging infrastructure “and certainly the Affordable Care Act, otherwise known as Obamacare, are dominating the discussion.”
Ramsey also discusses challenges more specific to West Virginia.
“Those of us in southern West Virginia have been feeling the effects of a downturn in the coal and natural gas industries and changes in health care payment models for quite some time,” he says.
Ramsey continues, “Regrettably, there is no end in sight for West Virginia’s economic situation, poor reimbursement from governmental insurance, rising costs of drugs and technology, the nursing shortage and the cost of caring for government insured patients.”
U.S. Sen. Joe Manchin released a statement Tuesday evening, saying the announcement should be a “rallying cry” to address problems facing health care.
“West Virginians know better than anyone how to overcome tough problems by working together,” he said. “People’s lives and livelihoods depend on us putting party aside to do what is right for the people of West Virginia.”