Boston Medical Center announced in a statement released Monday that it would lay off 119 staff members in order to make up for a projected $175 million loss due to “dramatic changes in Medicaid reimbursements.”
“The layoff is one necessary element of addressing the hospital’s financial situation,” said Thomas Traylor, BMC’s vice president of federal, state and local programs, according to Monday’s press release.
The proposed layoff—scheduled to take effect on Oct. 1—involves 30 members of management, 44 nurses, and a variety of other administrative positions.
In addition to the layoffs, BMC said it also planned to reduce the hours of another 40 employees.
The layoffs and reduced hours will save an estimated $8 million, and are just two of many efforts BMC is making to reduce costs, according to the Boston Globe.
In July, BMC closed down an emergency department, saving approximately $2.5 million per year.
Last year BMC filed a lawsuit against the Mass. state government, accusing officials of illegally cutting payments to the hospital for thousands of poverty-stricken patients.
According to the Globe, BMC is “hopeful” that it will benefit from a Mass. petition to the federal government for increased Medicaid payments—which, if approved, could amount to $90 million a year for two years.
BMC had projected a budget hole of $134 million for the current fiscal year, but additional costs and slower-than-expected revenue growth resulted in the larger deficit, BMC Chief Executive Kate Walsh told the Globe. She attributed the increase in losses to an unexpectedly high number of Medicaid patients and insufficient government reimbursement.
“In order to save the hospital, the state must present a solution to the funding crisis and BMC management must include its staff in forming a real plan for the hospital’s future,” wrote Veronica Turner, executive vice president of the 1199 Service Employees International Union and a former BMC employee, in a statement.
BMC, a teaching affiliate of Boston University School of Medicine, currently employs close to 6000 people, of whom more than 1500 are nurses, according to the announcement by BMC.
In 2008, BMC laid off 250 workers, saving $10.5 million, the Associated Press reported.
Boston Medical Center declined to comment.
—Staff writer Sirui Li can be reached at sli@college.harvard.edu.
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