Cabinet Peaks Medical Center in Libby laid off eight people on Aug. 22 in what the hospital called a “targeted reduction in workforce.” The layoffs come just months after Cabinet Peaks opened a new $34 million facility that replaced the smaller St. John’s Lutheran Hospital.
Hospital officials said the layoffs were made because of the economic pressures facing the medical industry and Lincoln County.
“Health systems throughout Montana and across the nation have been forced to reduce costs to address the rapidly changing healthcare environment, which includes a shift to more outpatient services and declining reimbursement,” CEO Bruce Whitfield said in a press release. “Cabinet Peaks Medical Center is not immune to those economic pressures.”
According to spokesperson Kate Stephens, an outside company came to the hospital in April to evaluate the facility’s productivity compared to other hospitals of its size. Stephens said the evaluation revealed overstaffing in some departments and understaffing in others.
A total of eight positions in five different departments were cut, including the laboratory, the dietary department, rehab services, the cardiopulmonary department and materials management. Another employee had their hours reduced from full time to part time. Officials declined to say how much money the layoffs would save the hospital.
About 232 people currently work at the hospital.
In the press release, Whitfield said the hospital had made many efforts to reduce costs in recent months but that even after that the administration felt the layoffs were necessary “to ensure the medical center’s financial security.”
“We are very much a family at Cabinet Peaks Medical Center, and our associates are incredibly valuable to our organization. This difficult decision was not reached easily and comes only after careful consideration and thorough analysis,” Whitfield said. “While these decisions and times are difficult, the change is necessary for Cabinet Peaks Medical Center to continue to provide quality, compassionate care to the communities that we serve. We will continue to provide excellent patient care and remain focused on improving the patient experience.”
The mood of this week’s announcement was markedly different from just a few months ago when officials celebrated the completion of the new $34 million facility. Construction on the 77,000-square-foot facility began in 2012 and was aided in part by a loan from the U.S. Department of Housing and Urban Development. The new hospital replaced a smaller one built in 1952.
The announcement that eight people had been laid off deals another blow to Lincoln County’s already fragile economy. In July, the county’s unemployment rate of 10.5 percent was more than twice the state’s 4.4 percent. Earlier this year, Lincoln County’s unemployment rate hit 18 percent, the highest it had been three years. The area’s economy has been struggling for more than two decades as the mining and forestry industries experience sharp declines in that area.
Hospital officials insisted that the decision to layoff people was not taken lightly, however they remained hopeful for the future.
“Our patients are why we go to work every day and we’re still going to offer them the best healthcare we can,” Stephens said.