Penn Medicine Lancaster (Pa.) General Health has eliminated fewer than 65 jobs, or less than 1 percent of its workforce of about 9,700, the health system confirmed to Becker's.
The layoffs include support, administrative and executive roles, and COVID-19-related support staff, spokesperson John Lines said, according to lancasteronline.com. Mr. Lines did not provide a specific number of affected workers.
CEO John Herman, who announced the layoffs in a March 29 memo to employees, also did not give specifics about how many jobs were affected but said it was a small portion of the workforce.
"Earlier today, we took the difficult step of eliminating a small number of positions — less than 1 percent of our total workforce — to continue our work toward greater efficiency," Mr. Herman wrote in the email, according to lancasteronline.com. "In keeping with our focus on preserving resources for investments at the bedside and in our clinics, none of these roles are responsible for direct clinical care."
Mr. Lines told Becker's affected workers will receive help finding other jobs, within LG Health and outside the organization. He also said that those leaving Lancaster General Health will be provided with severance and continuation of benefits based on length of service.
The layoffs come as hospitals and health systems across the U.S. have struggled financially. In 2021, LGH posted $99.6 million in excess revenue over expenses from operations, compared to $30.3 million in 2022, according to lancasteronline.com, which cites a September 2022 LG Health bond disclosure. LG Health's fiscal year 2022 ended last June.
Also, LG Health rescinded workers' holiday gift in 2022, citing "challenging economic times."
In the March 29 memo, Mr. Herman said the hospital's parent, Philadelphia-based Penn Medicine, "stands as one of the few systems in the region that continues to maintain a modest positive operating margin. Still, a larger margin is critical so that we can continue to invest in our people, our infrastructure and technologies, to improve the care we deliver every day."
He also pointed to other efforts LG Health has made to save money, including reducing use of agency labor and overtime and not backfilling non-essential vacancies to better align staffing with patient demand, according to lancasteronline.com.
The LG Health layoffs come as Penn Medicine recently announced it would eliminate administrative positions as part of a reorganization plan to save the health system $40 million annually.
Mr. Lines, with LG Health, told lancasteronline.com that the LG Health cuts were made independent from Penn Medicine and emphasized the health system's commitment to investing in infrastructure and service upgrades, which contribute to the system's financial health. Lancaster General Hospital is currently undergoing an expansion of its emergency department, and the system recently opened a cancer proton therapy center.
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