ProMedica Lays Off 100 Workers

Health system says the 'majority' of the layoffs affect corporate positions, and another 60 vacant positions will not be filled. 

Toledo-based ProMedica says that it laid off 100 workers in leadership and corporate areas this month as part of an ongoing effort to cut costs and improve efficiency.

"The healthcare industry continues to face a series of challenges, including decreasing reimbursement rates for services and rising operational costs. To adapt, health systems around the country have had to make tough financial decisions," Karen Strauss, ProMedica's chief human resources officer, said in prepared remarks.

The "majority" of the approximately 100 affected employees serve in leadership and corporate roles, she said. In addition, 60 vacant "non-direct patient care positions" will not be filled.

The layoffs are unrelated to the $3.3 billion joint acquisition with private equity firm Welltower of bankrupt long-term care provider HCR ManorCare, Strauss said. The deal was finalized late last month.

Strauss said that while the joint venture is expected "to bring opportunities for growth and synergy, we still must address pre-merger ProMedica financial issues now." 

It's been an eventful year for ProMedica.

The acquisition of ManorCare, the nation's second-largest long-term and post-acute care provider, essentially doubled the size of 13-hospital ProMedica overnight and gave it a footprint in 30 states. ProMedica CEO Randy Oostra said the acquisition was needed because ProMedica was situated "in a non-growth market" and had few other options to expand or diversify.

"I hate to say we are in uncharted waters here, but it seems to be a unique, first-of-its-kind partnership. A nonprofit health system, a large post-acute provider and a real estate investment trust as partners is unique," ProMedica CEO and President Randy Oostra said in an interview with HealthLeaders Media this spring.

Earlier this month, ProMedica formed a joint partnership with Sonic Healthcare USA called ProMedica Pathology Laboratories, which will provide lab tests for inpatients at health system and affiliated providers in Ohio, Michigan and parts of Indiana.