Independence Health cuts 151 workers, locations not specified

Independence Health System is laying off 151 employees as it looks to cut costs.

Kelly Skoloda, chief marketing and communications officer for the financially challenged regional health care provider, confirmed the staff cuts Wednesday in a statement mirroring a message sent to employees by the system’s president and CEO, Ken DeFurio.

Independence Health, when questioned by TribLive, didn’t reveal what categories of staff members are being affected or where they are located. The former Excela Health — with a flagship hospital in Greensburg and others in Latrobe and Mt. Pleasant — and Butler Health systems merged to form Independence in 2023.

The affected workers represent the equivalent of 122 full-time positions and about 2% of the health system’s workforce of 7,300, according to the statement.

The staff cuts apparently have been underway since the beginning of the year.

“This includes 81 individuals who will be impacted this week — either through transfers to vacant roles or, sadly, through the loss of their current positions,” Skoloda said.

DeFurio added in his message: “We have worked very hard to impact as few of our colleagues as possible. We will fill vacant positions with these individuals wherever we are able.”

Tammy May, president of a nurses union at Butler Memorial Hospital, said she learned one of the 499 members of the Pennsylvania Association of Staff Nurses and Allied Professionals local there is among the employees being laid off. The union is in the midst of negotiating a new contract.

“It’s very ironic to me that we have a bargaining session going tomorrow and the (CEO) email was published today,” May said Wednesday. “We’re still trying to figure everything out. Contractually, we have a layoff procedure. We want to ensure they are following everything.”

County reaction

While it’s not clear how many of the layoffs may involve positions at the three former Excela hospitals or at affiliated ambulatory care centers in North Huntingdon and Unity, Westmoreland County leaders expressed concern.

Sean Kertes, chairman of the county commissioners, and Doug Chew, vice chairman, expressed regret for the immediate impact of the layoffs while expressing hope Independence will continue to be a major player in the local economy and health care industry.

Kertes noted Independence Health is the largest local employer in Westmoreland County and “has been restructuring for a period of time. I hope this is not a long-term impact to the residents of Westmoreland County or those who work there.

“I hope (Independence) continues to focus on being a major health care provider in the county.”

In February, an Independence official said the health system had about 4,300 employees in Westmoreland County.

“Health care is extremely challenging, especially in today’s economic climate,” Chew said. “It’s essential that we preserve hospitals and care close to home.

“I support (Independence’s) efforts to optimize resources for long-term sustainability — even when difficult decisions must be made — to ensure care and employment remain in our community. In my previous experience in health care, most layoffs at one hospital are quickly hired up by another system. Southwestern Pennsylvania has had a health care staff shortage for some time.”

“Layoffs are never good news, and I feel for the families affected,” Westmoreland Commissioner Ted Kopas said. “This is also troubling for our residents who deserve quality, local medical care.”

Skoloda mentioned Independence Health cut its losses nearly in half from 2023 to 2024.

“But despite these efforts, like many health systems, we continue to face unrelenting and unprecedented financial and operational pressures — both within health care and across the broader economy,” she said. “We must continue to make difficult but necessary decisions.

“These decisions are not a reflection of the dedication, talent or contributions of those affected.” Skoloda said. “But not acting decisively in the face of our financial challenges would jeopardize the care we provide and the future we are working so hard to protect. We owe it to our patients and our communities to preserve and strengthen the health system relied on by so many for expert care, here.”

Financial goal

According to recent financial statements, which continue to be filed separately for the two former health systems, Excela Health reported an operating loss of $5.6 million for the last six months of 2024, compared with a loss of more than $15.2 million during the same period in 2023.

For Butler Health System, the six-month operating loss was $10.7 million, down from $18.2 million.

For the 12 months ending in June, operating losses of $29.8 million were attributed to Butler Health, while Excela Health had losses of $11.6 million.

Earlier this year, Independence Health Chief Financial Officer Tom Albanesi told TribLive the health system has a goal of improving its operating margin to slightly better than break-even by 2026, and planned to get there by reducing expenses by 2.5%.

At that time, Independence indicated any related staff cuts likely would be among nonclinical positions. Independence cut 226 positions in 2023.

On the same day it announced the most recent layoffs, Independence posted nine new job openings on its website and listed dozens from earlier in April.