KALAMAZOO, Mich. — A major health system is furloughing part of its workforce and implementing several other cost-cutting measures to "recover from the financial downturn" created by the coronavirus.
Citing a "work slowdown" and saying services won't "ramp up all at once and current losses need to be covered," Bronson Healthcare will furlough "several hundred mostly non-clinical employees" over the next few weeks, according to the health system this afternoon.
The furloughs should be for 16 weeks. A Bronson spokeswoman could not specify the specific number of people the furloughs will affect.
Bronson said some furloughed employees may be "called back sooner as their areas ramp back up."
The health system is also reducing the salary of its CEO, Bill Manns, by 25% and reducing pay for all executives and leaders at "decreasing percentages proportionate to salary levels" through August 15. Health care care providers in the Bronson Medical Group are part of the salary reduction.
Core contributions to employee retirement accounts and 403b/401k matches are being suspended for the rest of the year too.
In an interview with FOX 17, Manns could not say how much money these moves save Bronson, instead he said they’re also re-evaluating their service contracts and hope to partner with other providers to prevent further cuts.
“We’re taking the matter very seriously and trying really not to balance the bottom line on the backs of our employees,” said Manns. “We don’t want to dig such a deep financial hole that it becomes even more difficult to dig out of.”
Bronson Healthcare said its expenses have risen "significantly due to preparations and purchases related to COVID-19."
Manns could not say how much more Bronson Healthcare is spending but said the health system is experiencing a 50 percent decline in revenue due to various factors: the suspension of elective surgeries and procedures, temporary closings of some services, as well as reduced diagnostic tests, office visits and emergency department visits "as patients remain at home."
“When you combine the two, it means the bottom line suffers,” said Manns. “From our perspective, the sooner we can get restarted performing surgeries, seeing patients, the better.”
According to Manns, Bronson received $16.1 million through the CARES Act and plans to apply for more funding once the second round of funding is approved by Congress. The health system is also pursuing reimbursements and grants through FEMA and other state and federal relief.
"We are starting to ramp up surgeries and other procedures within the scope of the governor’s order, with a goal of having our hospitals back to 100% by September, and our practices, many of which have been doing video visits, at 100% by August," Manns said.
"If we can do it sooner, we will. However, the availability of enough PPE to ensure the safety of our staff and patients in all settings continues to be a limiting factor.”
Manns added Bronson is resilient and affected employees and patients should know the health system is there for them during the pandemic.
“Bronson has been around for 120 years,” said Manns. “We plan to be around for another 120+. This is a blip in time.”
Bronson said it continues to "proceed with major projects in development": including seven offices for Bronson Primary Care Partners, which will open on July 1; the new lab at Bronson Methodist Hospital opening in late July; and the Bronson Cancer Pavilion in Kalamazoo and new Bronson South Haven Hospital, which are slated to open in early 2021.