Yuba City, Calif.-based Rideout Health will lay off 106 employees, roughly 5 percent of its 2,200-person workforce, by May 15 and scale back services over the next two months, according to the Appeal Democrat.
The two-hospital, nonprofit system has faced financial challenges in recent years, and CEO Gino Patrizio said the system must restructure its operations to ensure future sustainability, according to the report.
According to a memo sent to employees obtained by the Appeal Democrat, the layoffs and service cuts will occur across the organization. The system will discontinue several services, including home health and hospice, within the next 60 days and will cut ties with four clinics it manages in Grass Valley and Penn Valley, Calif., by June 30, according to the report.
Rideout's announcement comes a few months after Moody's Investors Service downgraded Rideout Health's credit rating from "Ba3" to "B1." The system faces ongoing cash flow pressures, lower-than-budgeted revenue growth and rising expenses associated with ongoing capital improvements, according to Moody's.
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