Michigan health system plans layoffs, job cuts amid pandemic

ROYAL OAK, Mich. (AP) - A Michigan health care system on Tuesday announced temporary layoffs and permanent job cuts as its operations lose money following a shift in services due to the coronavirus pandemic. Beaumont Health said that in addition to the 2,475 layoffs and 450 position cuts, top executives will take pay reductions of up to 45%. Chief Executive John Fox's base pay will be cut 70%. Hospitals and health care systems saw a massive rush of COVID-19 patients over the past month or so to emergency rooms and intensive care centers as the virus rumbled through the United States. Some hospital units not dedicated to treating virus patients have been closed or have seen services severely cut back. The Detroit Medical Center said earlier this month that it would furlough about 480 of its hospital workers. "After Beaumont began caring for COVID-19 patients five weeks ago, nearly all inpatient and outpatient surgeries and other non-COVID-19 medical services had to be halted," the health system said in a statement. "In addition, the number of patients seeking care unrelated to COVID-19 dramatically declined." The state health department on Monday reported a daily rise in new coronavirus cases and COVID-19 deaths, but both were smaller than the new numbers disclosed Sunday. The number of people infected increased by 576 to 32,000, although many of them have long recovered, while deaths rose by 77 to 2,468. Beaumont saw a decrease of more than $400 million in net income in the first quarter of this year. Operating revenue dropped by about $78 million under what was reported for the first three months of 2019. The health system has 38,000 employees at eight hospital in southeastern Michigan. Most of the temporary layoffs will involve hospital administrative staff and others who are not directly caring for patients with or without COVID-19. Most of the 450 position cuts will be to corporate and administrative staff. "While many front-line employees have never been busier, other parts of our operations have drastically declined or ceased," Fox said. "We also expect economic pressures on Beaumont and the health care industry to continue well after the COVID-19 initial surge subsides." Published: Wed, Apr 22, 2020