Catholic Health Initiatives (CHI) is laying off 459 employees and eliminating 161 vacant positions at 17 of its Texas hospitals, Houston Business Journal reported.
CHI announced in 2014 that it would cut 1,500 positions nationwide and had already announced the elimination of 665 positions in Texas from August 2016 through the beginning of this year.
- CHI has struggled financially since 2012 and its future is not looking too bright, as indicated by recent decision from Moody’s Investor Services to downgrade the health system’s bond rating.
It remains to be seen whether CHI can turn its fortune around. The health system has cut positions, sold property and stepped back from failing lines of business, but the losses continue to rack up.
While an earnings report covering January through March should be available soon, the most recently released quarterly report did not paint a pretty picture. Operating losses at CHI totaled $153.9 million in the second fiscal quarter of 2017 compared with losses of $112 million in the second fiscal quarter of 2016.
CHI is hardly the only health system struggling to keep pace with recent changes. After Cleveland Clinic saw a 71% drop in its operating income, CEO Toby Cosgrove said that more than one-half of hospitals are taking similar hits to operating incomes as they restructure care of delivery systems to accommodate changes to healthcare policy.
Even health systems posting strong earnings reports are cutting back. Banner Health improved profitability in 2016 from 2015, but is still eliminating positions. While some health systems are doing better than others, none can escape rising expenses, lower patient volume and a shift away from inpatient services.