US-based Steward Health Care is reportedly set to lay off more than 1,200 workers in Massachusetts by the end of the month, coinciding with the closure of two hospitals in the state.
The health system will eliminate around 753 employees at Carney Hospital, while around 490 workers will be laid off from the Nashoba Valley Medical Center, Healthcare Dive reported on 5 August.
The report cited that this move is mentioned in a Worker Adjustment and Retraining Notification (WARN) report filed with state regulators on 29 July.
Recently, a US bankruptcy judge authorised Steward Health Care to proceed with the closures of Carney Hospital and Nashoba Valley Medical Center by the end of August.
These facilities are among eight hospitals operated by the health system in the Bay State region.
The judge also approved Steward's request to reject a lease agreement, which, according to Steward and Massachusetts officials, has hindered the transfer of the hospitals to new ownership.
The decision to close the two hospitals was announced last week, with Steward citing insufficient funds to maintain operations and lack of qualified bids.
Carney Hospital, situated in Dorchester, Boston, and Nashoba Valley Medical Center, located in the rural area of Ayer, Massachusetts, are reported to be operating at a loss and serving limited patients.
As per the court filings, Carney Hospital, with about 903 employees, reported an EBITDA loss of $14.7m from January to May.
Meanwhile, Nashoba Valley, with a workforce of 562, reported $2.3m year-to-date EBITDA loss.
The other six Massachusetts hospitals under Steward's management have EBITDA losses exceeding $63m within the same timeframe.
In an effort to aid the hospitals' continued operation, Massachusetts officials have proposed advance Medicaid payments of $30m, contingent on Steward finalising sales agreements for its five remaining hospitals, as reported by WBUR.
This proposal is scheduled for discussion at a hearing on 6 August.
Steward, headquartered in Dallas, filed for Chapter 11 bankruptcy in the Southern District of Texas in May.
