West suburban hospital system Edward-Elmhurst Health has laid off 84 employees as part of plans to slash $50 million in costs.
In all, the system is cutting 234 positions, mostly by not filling vacant spots. Of the 84 people who lost their jobs, 36 were in management, said spokesman Keith Hartenberger. The system had nearly 9,000 employees before the layoffs.
Those who lost their jobs received severance packages.
“This was a difficult decision, but necessary to ensure the long-term future of the system,” the system said in a statement Wednesday.
The layoffs come less than two months after the system announced plans to cut $50 million from its budget. Edward-Elmhurst didn't experience a loss for the year ending June 30 but did fall more than $8 million short of its budget for operating income, CEO Mary Lou Mastro has said.
“It's been a one-year trend for us, but we don't think we can sit back and wait and watch and see what will happen. We want to take action right away,” Mastro said during a call with reporters in August.
The system, which includes Edward Hospital in Naperville, Elmhurst Hospital in Elmhurst and Linden Oaks Behavioral Health in Naperville, is facing many of the same financial pressures as other hospitals in Illinois and across the country.
One of those pressures is higher numbers of patients covered by Medicare and Medicaid, which don’t cover the full costs of patient care, Mastro has said.
Also, Mastro has said more patient bills are going unpaid, likely because of higher insurance copays and deductibles. The system is also dealing with increased charity care, fewer patients with private insurance, private insurance payments that fall short of medical inflation, and higher drug and medical supply costs.
Citing similar issues, Advocate Health Care announced that it would make $200 million in cuts. Northwest suburban Centegra Health System said last month that it planned to eliminate 131 jobs and outsource another 230 positions.
Edward-Elmhurst is also reducing costs through savings on vendor contracts and purchases of supplies and drugs, according to the system’s statement.