Thousands of jobs shed in Pittsburgh region’s hospitals

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The region’s hospitals shed the equivalent of 2,000 full-time positions in 2013, according to a newly released survey by the Hospital Council of Western Pennsylvania trade association.

The employment decline — from 71,457 full-time equivalents to 69,439 — comes as hospitals work to reduce their costs in light of reduced payments from Medicare and other insurers, as well as other cuts, said Denis Lukes, vice president of financial services for the council.

“We’ve seen little ups and downs [in job reductions] before, but I don’t think we’ve seen anything like this in recent times.”

The report follows a survey last week by the Hospital and Healthsystem Association of Pennsylvania that found hospital employment statewide fell by 3,900 jobs in the 12 months ending in February.

Despite the sobering job news, the 57 hospitals responding to the regional survey did report improved operating margins to an average of 3.19 percent over the six-month period, up from 1.74 percent for the same period in 2012.

But 35 percent of the responding hospitals said they had an operating loss for the last six months of 2013 and 25 percent recorded a net loss, Mr. Lukes said.

In addition to reduced reimbursements, hospitals’ bottom lines are being pressured because the amount of care they provide without being compensated continues to increase. For the last half of 2013, uncompensated care reached $563 million, a 13.83 percent increase from 2012.

A growing portion of uncompensated care, Mr. Lukes said, is generated by insured patients who are enrolled in high deductible plans. Typically, they have chosen a plan based on a monthly premium that they believe they can afford, but those plans may come with a deductible of $5,000 or more.

“We’re hearing from the hospitals that the individuals are very surprised when they come to the hospital and find out they’re responsible for that kind of deductible.”


Steve Twedt: stwedt@post-gazette.com or 412-263-1963.

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