How hospitals are cutting back to reduce costs

Despite efforts to curtail high expenses, rising inflation and declining federal aid have led many hospitals to begin laying off workers and cutting certain services, Katheryn Houghton writes for Kaiser Health News. John Romley, a health economist and senior fellow at the Schaeffer Center for Health Policy and Economics at the University of Southern California, said some hospitals are likely now losing money, particularly with less federal aid coming in and growing inflation on top of their already high expenses. To reduce expenses, many hospitals are beginning to lay off workers and cut certain services, which has forced some patients to travel farther to receive care. For example, Bay Area Hospital in Oregon recently ended 56 contracts with travel nurses and cut its inpatient behavioral health services due to the high costs of quickly filling vacant positions. St. Charles Health System, headquartered in Bend, Oregon, laid off 105 workers and eliminated 76 vacant positions in May. The system's CEO at the time, Joe Sluka, said, "It has taken us two pandemic years to get us into this situation, and it will take at least two years for us to recover."