Marshfield Clinic Health System will lay off around 360 employees it had furloughed earlier this year, a spokesperson said.
The nonprofit health system in January put about 3% of its workforce on temporary, non-paid leave as it manages rising labor and supply costs, among other financial challenges. Those employees will be laid off and given severance in early May, the spokesperson for the 11-hospital system said in a statement.
Register for Modern Healthcare’s Digital Health Summit May 14 in Chicago
“We are pleased that since January more than 60 furloughed employees pursued and were offered alternative employment opportunities with the health system, and dozens more opted to take roles outside the organization,” the spokesperson said.
The staffing cuts follow the Marshfield, Wisconsin-based health system’s failed merger proposal with Duluth, Minnesota-based Essentia Health, both of which largely operate in rural areas. The combination would have created a $6 billion integrated health system spanning Michigan, Minnesota, North Dakota and Wisconsin. The health systems' CEOs said in January, when talks ended, that the timing wasn’t right.
Marshfield has recorded operating losses since 2021. Through the nine months ended Sept. 30, the latest data available, Marshfield reported an operating loss of $133.6 million on operating revenue of $2.32 billion. The health system recorded an operating loss of $92.6 million on operating revenue of $2.28 billion in the comparable 2022 period.
The credit rating agency Fitch Ratings downgraded Marshfield’s rating outlook to negative in January, citing its constrained cash flow and ongoing operational challenges. But Marshfield’s finances may rebound later this year as the health system implements its $250 million financial improvement plan, including revenue cycle optimization, boosting labor productivity and better claims denial management, Fitch analysts said.
