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Hospitals attribute layoffs to health care reform

by Nancy Ryerson, Staff Writer | July 03, 2013
Jobs in the health care sector accounted for 22.7 percent of total job growth over the last decade, according to a new report by the Brookings Institute, news that comes in contrast with reports of lay-offs at health systems around the country.

The report found that health care has accounted for 13 percent of total job growth in the country's largest 100 metro areas since the recession.

"In some cases, health care jobs accounted for about 40 percent of the total job growth," study author Martha Ross told DOTmed News.

Ross said that while the Brookings Institute does not run projections, the Bureau of Labor Statistics and the Georgetown Center on the Economy predict growth will continue, thanks in part to the aging Baby Boomer population.

But that growth isn't as evident at the health care systems that have reported layoffs in the last few months, such as St. Vincent's Healthcare in Florida.

At St. Vincent's, which announced staffing changes at the end of May, a statement from the hospital attributed the layoffs to modifications in Medicare reimbursement under the Affordable Care Act. A Medicare expansion was meant to accompany the cuts, but the Florida legislature did not pass that expansion.

The statement said the cuts would impact less than 1 percent of its 5,000-person workforce.

"It is critical we respond to this declining reimbursement so we can provide not only the highest quality care, but also the most efficient care for generations to come," the statement read. "In order to do this, we are working to restructure our operating costs, which includes closely evaluating open and existing positions within the organization and eliminating some existing positions."

A similar problem arose for Ozarks Medical Center, a rural Missouri hospital where 65 percent of patients are on Medicaid. The hospital let 32 employees go after Missouri chose not to expand Medicaid, KRCU reported on June 28.

On the East Coast, Waterbury Hospital in Connecticut cut 83 positions, citing state and federal reductions. Inova Health System in the Washington D.C. area also reported recent layoffs.

Ross said that while individual hospitals may have made layoffs both during the recession and otherwise, individual perspectives do not necessarily speak to the larger economic image.

"It wouldn't surprise me if someone in a particular metro area where a hospital or doctor's office or nursing home was laying people off, if they had the perception that health care is shrinking," said Ross. "But when you look at the aggregate, it is growing."

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