South Bend, Ind.-based Beacon Health System has instituted a hiring freeze and will reduce hourly pay for many contracted workers, according to an internal letter sent to staff obtained by NPR member station WVPE.
The reduction in pay is slated to begin in late May, according to the letter.
The change comes as Beacon reported a net operating loss of $18.8 million in the fiscal year ended Dec. 31. It also comes after the health system raised its base entry-level pay to $15 per hour, effective Oct. 10, 2021. The pay increase applied to current employees and all new hires across more than 170 different titles. Beacon also boosted its pay for nurses by up to $17 in 2021, according to WVPE.
In a written statement shared with Becker's, the health system said it evaluated the pay rates for certain clinical roles that were elevated significantly during the pandemic and "determined we cannot continue to pay those elevated rates and have notified and are meeting one-on-one with the affected clinicians. We are committed to staying competitive and ahead of market average pay for these clinical roles."
Hourly pay for workers will be reduced by $3 for those with a three-year contract and by $7 for those with a five-year contract, Beacon said, according to WVPE.
Following the announcement about the pay decrease, some nurses are discussing unionization, according to ABC affiliate WBND
Beacon is making other cost-cutting efforts as well. Beacon Medical Group Edwardsburg (Mich.) will be closing on May 30, and Beacon Medical Group Pediatric Endocrinology services will end on July 2, the health system said.
Beacon added that it is "making these adjustments so our focus can remain on delivering outstanding care, inspiring health and connecting with heart in the communities we serve for well into the future."
Beacon's website states the health system has more than 7,000 employees in Indiana and Michigan.