HealthSouth Corp., Birmingham, Ala., plans a 2% reduction in its workforce, or about 1,000 jobs, over the next few months, primarily in administrative and support positions. The layoffs are part of a corporate initiative to reduce costs in response to a projected $175 million decline in 2003 operating earnings. The company stunned investors in August when it said a Medicare policy clarification regarding group and individual outpatient therapy would result in a significant decline in earnings. HealthSouth operates about 1,800 imaging, surgery and rehabilitation facilities in the U.S. and abroad. "As we have described, the developments in our outpatient rehabilitation business arising from changes in Medicare policy adversely affected our revenues in the third quarter, and we have to cut costs in all areas to respond to these changes," company Chairman Richard Scrushy said in a written statement. -- by Julie Piotrowski
HealthSouth to trim workforce by 2%
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