Maternity nurse and Massachusetts Nurses Association director Susan Wright-Thomas speaks May 20, 2022, at CHA Cambridge Hospital. (Photo: Marc Levy)

Cambridge Health Alliance will lay off or reduce hours for 84 employees to fill a huge deficit that threatened to leave the health care system with $40 million to $45 million in losses. In a message to employees Monday, chief executive Assaad Sayah said the Alliance could not plug the hole without reducing its staff.

Hinting that the existence of the Alliance was at stake, Sayah said the cuts were necessary “to ensure CHA remains a vital safety net for vulnerable patients in our communities.” The reductions will come July 1, when the next fiscal year starts.

A total of 254 positions were eliminated, 67 percent of them vacant, CHA spokesperson David Cecere said. The cuts will cause “minimal impact to patient care and clinical services – the reductions are primarily from management, administrative and support areas,” Cecere said. He said the deficit stemmed from “unprecedented industrywide challenges including inflation and a workforce shortage.”

Sayah said the Alliance will provide severance pay and help in getting other jobs, including training. “Many” affected workers can get other jobs at CHA, he said, which will also cut spending in “non-salary areas” such as “consulting, marketing and other purchased services.” And it will expand “primary care access,” add specialists and beef up inpatient and outpatient mental health services, “all of which are areas of great need across our region,’’ he said.

The Massachusetts Nurses Association, which represents registered nurses and other health care workers, said five nurse-educator positions will be cut, though affected employees will be eligible to move to other jobs.

Nurse-educators train and assess newly graduated nurses. A nurse who emailed anonymously said the layoffs would leave one nurse-educator position for eight psychiatric units, one for five areas in the intensive care unit and one for four medical/surgical units. “It is not realistic how one person can do eight psychiatric units in three cities and remain safe, especially how violent [patients] are,” the person wrote.

The writer also noted that CHA has seven assistant chief nursing officers along with the chief, making nursing “top-heavy” with administrators while frontline workers are cut.

Word of seven to 10 position

Sayah and Cambridge City Manager Yi-An Huang alluded to the Alliance’s fragile financial condition at a meeting of the City Council’s finance committee May 16 at which councillors considered the budget for the Cambridge Public Health Department, which is operated by the Alliance under contract with the city.

Councillors said they had heard that CHA planned to cut seven to 10 positions from the department; Huang and Sayah didn’t deny it but said they couldn’t provide details because the matter was under discussion. Disregarding a request from Huang to wait for a decision, councillors voted to recommend that the city adjust its support of the Alliance to ensure that all services of the health department “are fully funded.” They also voted to recommend against approving the city’s budget figure.

It was not known whether any of the CHA layoffs disclosed Monday were health department employees.

A “difficult” environment

Asked whether the city had been told of Sayah’s Monday announcement of job cuts, city spokesman Lee Gianetti didn’t answer. He conveyed a statement from Huang saying the city “is committed to helping CHA through these difficult times.” Huang, who spent nine years as an administrator at Boston Medical Center, said he knew “how difficult the financial and operational environment is for safety-net hospitals.”

CHA’s most recent monthly financial report made public, for April, showed that the Alliance lost almost $42 million on health care operations for the 10-month period of its current fiscal year, which ends June 30. It lost almost $28 million overall, including after adding $6.5 million from the city for operating the city’s public health health department. These deficits were far deeper than expected.

The number of patients discharged from in-hospital care, a measure of volume, was lower than expected, while outpatient volume also lagged except for urgent and emergency care and psychiatric visits at the hospital. Chief financial officer Jill Batty said some of the volume in the emergency department and urgent care came because “often when we don’t have capacity in other areas” patients must come to the emergency room and urgent care center.

Source of aid disappears

Batty said despite the lower-than-expected volume, patient revenue was close to the budget, but expenses more than wiped out that advantage. She said vacancies had dropped somewhat, lessening the need to hire expensive temporary nurses and other workers, but not eliminating it. Inflation increased costs for utilities and the Alliance will also pay more for anesthesiologists, who are in short supply in the region, she said. Total operating expenses were $37 million higher than budgeted for the 10 months, according to the report.

Losses would have been worse were it not for a one-time $8 million in government aid, Batty said.

That won’t be available in May and June, but the trend of low volume and high expenses will persist to the end of the fiscal year, Batty said. That could lead to a loss “perhaps in the range of $40 million to $45 million,” she said.