Hawaii Medical Center will lay off 150 more at Ewa, Liliha hospitals
3rd round of cuts comes a month after company filed for bankruptcy
By Mary Vorsino
Advertiser Staff Writer
In its third round of layoffs in four months, Hawaii Medical Center announced yesterday that it will let go of at least 150 employees at its hospitals in Liliha and 'Ewa
Officials said the laid-off staff — who represent about 18 percent of HMC's workforce of 830 employees — would be given 60 days notice. Laid-off workers, none of whom provide direct patient care, will be notified starting next week and will receive help transitioning to new jobs.
The layoffs come nearly a month after the for-profit Hawaii Medical Center filed for Chapter 11 bankruptcy protection, spurring a restructuring plan meant to drastically trim expenses and increase efficiency.
Dr. Danelo Canete, HMC chief executive officer, said yesterday the reduction in staff will not mean reduced services.
"We will still have sufficient staffing to provide excellent patient care after the reduction," he said. "Our staff is too large for the number of patients in our hospitals."
The job losses are the latest in a string of layoffs in Hawai'i, and the company blamed them at least in part on the tough economic times and credit crunch.
Hawaii Medical Center LLC, which operates the former St. Francis hospitals in Liliha and 'Ewa, filed for bankruptcy protection on Aug. 28 in Delaware. At the time, HMC listed assets of between $10 million and $50 million, while it listed liabilities of between $50 million and $100 million.
Canete has said that the company was forced to file for bankruptcy protection after its lead creditor, Siemens Finance, was unwilling to extend an existing loan agreement. Siemens was owed about $5.5 million.
Hawaii Medical Center LLC, the state's only for-profit hospital operator, has struggled since it purchased the two financially strapped medical centers from St. Francis Health Care System in January 2007.
The company is a partnership of CHA Hawaii, an affiliate of Cardiovascular Hospitals of America, and about 130 Hawai'i-based doctors.
Salim Hasham, HMC's director of implementation, said the tough economic times and credit crunch in Hawai'i and nationwide are at least partly to blame for the layoffs, since Siemens' unwillingness to extend its loans was because of the tight market.
"We were actually caught in it from that standpoint," he said.
Hasham, who was hired five months ago to help orchestrate an HMC turnaround, also said he hasn't ruled out the possibility of more layoffs. But at this point, he said, he doesn't see the need for more staff reductions.
This is the third major layoff at Hawaii Medical Center this year.
In June, HMC let go of 89 employees in its business and information management departments and outsourced the positions to a Tennessee-based firm. Then, in August, HMC laid off 80 employees at its two facilities.
The most recent layoff will save HMC about $10 million annually.
Richard Meiers, Healthcare Association of Hawaii president and chief executive officer, said though hospitals are not the first entities affected in an economic downturn, they are starting to see the effects of the tough market.
For one, he said, more laid-off workers means more people without insurance who need care. Even before the economic downturn, he added, hospitals were already struggling with low Medicaid reimbursements, nurse and doctor shortages and other problems.
"It's part of a bigger picture," Meiers said of the issues facing hospitals amid the economic crisis. "There's going to be a lot more grief over the next couple years."
Reach Mary Vorsino at mvorsino@honoluluadvertiser.com.
By Mary Vorsino
Advertiser Staff Writer
In its third round of layoffs in four months, Hawaii Medical Center announced yesterday that it will let go of at least 150 employees at its hospitals in Liliha and 'Ewa
Officials said the laid-off staff — who represent about 18 percent of HMC's workforce of 830 employees — would be given 60 days notice. Laid-off workers, none of whom provide direct patient care, will be notified starting next week and will receive help transitioning to new jobs.
The layoffs come nearly a month after the for-profit Hawaii Medical Center filed for Chapter 11 bankruptcy protection, spurring a restructuring plan meant to drastically trim expenses and increase efficiency.
Dr. Danelo Canete, HMC chief executive officer, said yesterday the reduction in staff will not mean reduced services.
"We will still have sufficient staffing to provide excellent patient care after the reduction," he said. "Our staff is too large for the number of patients in our hospitals."
The job losses are the latest in a string of layoffs in Hawai'i, and the company blamed them at least in part on the tough economic times and credit crunch.
Hawaii Medical Center LLC, which operates the former St. Francis hospitals in Liliha and 'Ewa, filed for bankruptcy protection on Aug. 28 in Delaware. At the time, HMC listed assets of between $10 million and $50 million, while it listed liabilities of between $50 million and $100 million.
Canete has said that the company was forced to file for bankruptcy protection after its lead creditor, Siemens Finance, was unwilling to extend an existing loan agreement. Siemens was owed about $5.5 million.
Hawaii Medical Center LLC, the state's only for-profit hospital operator, has struggled since it purchased the two financially strapped medical centers from St. Francis Health Care System in January 2007.
The company is a partnership of CHA Hawaii, an affiliate of Cardiovascular Hospitals of America, and about 130 Hawai'i-based doctors.
Salim Hasham, HMC's director of implementation, said the tough economic times and credit crunch in Hawai'i and nationwide are at least partly to blame for the layoffs, since Siemens' unwillingness to extend its loans was because of the tight market.
"We were actually caught in it from that standpoint," he said.
Hasham, who was hired five months ago to help orchestrate an HMC turnaround, also said he hasn't ruled out the possibility of more layoffs. But at this point, he said, he doesn't see the need for more staff reductions.
This is the third major layoff at Hawaii Medical Center this year.
In June, HMC let go of 89 employees in its business and information management departments and outsourced the positions to a Tennessee-based firm. Then, in August, HMC laid off 80 employees at its two facilities.
The most recent layoff will save HMC about $10 million annually.
Richard Meiers, Healthcare Association of Hawaii president and chief executive officer, said though hospitals are not the first entities affected in an economic downturn, they are starting to see the effects of the tough market.
For one, he said, more laid-off workers means more people without insurance who need care. Even before the economic downturn, he added, hospitals were already struggling with low Medicaid reimbursements, nurse and doctor shortages and other problems.
"It's part of a bigger picture," Meiers said of the issues facing hospitals amid the economic crisis. "There's going to be a lot more grief over the next couple years."
Reach Mary Vorsino at mvorsino@honoluluadvertiser.com.
Labels: Hawaii, Hawaii Medical Center, layoffs
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