Mercy announces layoffs in Springfield, Mo.

Published: Jun. 20, 2019 at 9:21 AM CDT
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After days of requesting information about employee layoffs, KY3/KSPR News received this statement from Mercy hospital concerning layoffs in four states, including Springfield, Missouri.

"Mercy, along with other health care providers, continues to be challenged by reduced reimbursement for the services we provide, especially from Medicare and Medicaid which do not fully cover the costs of care. At the same time, we are experiencing increased expenses for labor in an increasingly competitive job market, as well as rising costs for drugs and supplies.

While we will not compromise the outstanding quality of care we provide to our patients, we must work as efficiently as possible. That is why are restructuring this week, reducing targeted positions and moving some co-workers into new roles. The changes affect less than 1% of Mercy’s 45,000-member workforce.

Our transition plan for co-workers who are impacted reflects Mercy’s commitment to dignity and compassion. Our hearts and prayers go out to our affected co-workers and their families. They will receive help finding new jobs and a severance package including compensation and benefits based on their position and length of service."

Started by the Sisters of Mercy in 1871, Mercy is the fifth largest Catholic healthcare organization in the nation. Based in St. Louis, it has over 40 hospitals and 45,000 employees including over 12,000 in the Springfield area, joining Cox as the city's biggest employers.

But this week hundreds of Mercy employees have been receiving hand-delivered letters stating that "It is only after prayerful consideration that we must come to the difficult decsion that we will be separating employment with you."

The Release and Separation Agreement includes a clause that fired employees cannot talk to the media if they want to receive their separation severance pay.

Mercy officials also refused an on-camera interview and to provide specific numbers, although the less than one percent mention in the news release means the number of terminated employees is below 450.

As to why the cutbacks, Mercy's mention of reduced reimbursements from Medicare and Medicaid are a common complaint from many of the state's hospitals that have been sounded as an alarm for quite some time.

Four rural hospitals in the state have closed in recent years.

"This is a very complicated topic,"said Democrat Crystal Quade, the Missouri house minority leader from Springfield.

It was a year ago that the state contracted with three insurance companies for its Medicaid program and told hospitals that unless they also worked out "in-network" deals with those three insurers, they wouldn't get full reimbursements went it came to their "out of network" Medicaid patients.

"So that patient comes in with a broken arm," Quade explained. "If that hospital is not contracted with all three of our manage care companies that we work with, then the state of Missouri will only pay up to 90 percent of the costs for that broken arm (if the Medicaid patient is covered by a company the hospital isn't affiliated with)."

While a 10 percent loss may not seem like much, that's per patient and Mercy says it played a major role in the decision.

"I've never seen their books so I can't speak to whether or not this was justified," Quade said of Mercy's cuts. "But I can tell you that taking a 10 percent loss for reimbursements is going to hurt."

Quade says both Republicans and Democrats agree that something needs to be done about the problem but disagree on what.

"It's unfortunate because I don't know that we can have an honest conversation about the state of our health care system because things are so partisan around health care," she said. "The reality is people are losing their hospitals left-and-right in rural Missouri. We have maternal mortality rates that are out of control. People are dying and people are losing their jobs. So it is up to us in the legislature to sit down and have some real hard conversations about this."