Kaweah Health, the public hospital organization that operates the Kaweah Delta Medical Center, has increased its layoffs in a cost-saving effort to make up for deep deficits during the coronavirus pandemic.
Kaweah, like most Valley hospitals, has been under significant financial pressure since the pandemic began. The hospital group has launched a restructuring plan, known as “rebooting”, to reorient its finances.
What’s in the plan? At the top of the list are layoffs. The hospital announced the layoff of 106 existing positions and the closure of 90 vacant positions.
- This month, the hospital group added another 94 positions for layoffs, completing a full-class layoff through February 2023.
- In making the announcement, management said the move would generate $21 million in annualized benefits for the hospital.
- The hospital also pledged to reduce its contract workers — especially travel nurses — saving the hospital organization $55 million a year.
Bigger picture: Soaring costs, combined with Medi-Cal and insurance reimbursement rates failing to keep pace with rising costs, have pushed Valley Rural Hospital over the edge.
- Madera Community Hospital closed in early January and is preparing to declare Chapter 11 bankruptcy, largely due to increased costs and a failure to merge with Trinity Health.
- Meanwhile, the Fresno-based community health system has delayed some insurance agreements until the end of 2022 to renegotiate better medical reimbursement rates.