Pandemic fallout

Tower Health to cut 1,000 jobs after huge revenue losses

With a footprint that includes Reading Hospital and five other acute-care hospitals, a network of 22 urgent-care facilities and a rehabilitation hospital, Tower Health is a giant in the health care industry in southeastern Pennsylvania.

Tower Health, based in Berks County, announced Tuesday morning it is reducing its workforce by about 1,000 positions because of huge revenue losses stemming from the coronavirus crisis.

In a memo to employees and medical staff, Tower Health President and CEO Clint Matthews outlined the impact of the virus on the system’s financial health.

“While we excelled in caring for the community during the height of the pandemic, and continue to do so today,” Matthews

wrote, “the governmentmandated closure of many outpatient facilities and the suspension of elective procedures caused a 40 percent drop in system revenue — representing $212 million in lost revenue through May.

The positions are across the Tower Health system in executive, management, clinical and support areas. About 10% of the affected positions are currently unfilled.

Though spread across the system, the job cuts will be felt in the Berks and the Tri-County area in terms of health care services, according

to program administrators and a representative of a nurses labor union.

Facilities to close

Tower Health announced in its release it will close the Pottstown Hospital Maternity Unit and Tower Health Medical Group Reading Birth Center in Kenhorst, and it will close or consolidate certain clinical services, including select behavioral health services at Reading Hospital, as well as the Reading Hospital occupational medicine and sports medicine programs, and two physician practices, Coventry Foot & Ankle and Premier GYN Limerick.

Dr. Edward B. Michalik, head of Berks County Mental Health/Developmental

Disabilities, which administers state and federal funds to eligible mental health service providers, said he received notice Thursday that the intensive mental health program at Reading Hospital will be terminated by Aug. 14.

The program is for individuals who have more significant mental health problems and who may need to step up to a more intensive program than other services that receive funding through the county MH/DD stream, Michalik said.

“That’s going to have a big impact,” he said.

In addition, Stanley Papedemitriou, executive director of the Council of Chemical Abuse of Berks County, which oversees state and federally funded drug-and-alcohol treatment programs, said Reading Hospital is closing a key short-term, residential rehab program that has been centrally located in the county for decades.

In its present off-campus location on Buttonwood Street in West Reading near the traffic circle, the program was easily accessible to city residents as well as those outside of the city, Papademetriou said.

Formerly located on the main hospital campus, it is the only drug withdrawalmanagement program in the county accessible to a large portion of residents who are Medicaid-eligible, he said.

He said he’s confident other programs will be found for local clients, but there’s still an impact.

“The issue is it was right in the heart of the county, right outside the city, and has been there for decades,” Papademetriou said. “I’m not going to be exaggerating to say thousands of people who are in recovery from addiction

took their first step there.”

Though the funding for these two programs is intact, Michalik and Papedemitriou are scrambling to find other providers who will be able to handle the patient load.

“Stan and I are scrambling because we have 60 days to transfer people to appropriate levels of care both on an interim level and long-term level,” Michalik said.

Finding other providers

The closing of the maternity ward in Pottstown Hospital will also have an impact.

Megan Othersen Gorman, communications specialist with Pennsylvania Association of Staff Nurses & Allied Professionals, said the union received notification Tuesday that the ward where 32 nurses work will close Aug. 14.

For patients expected to deliver near, on, or after the closure date, Tower Health will work with their physicians to facilitate care for their patients to other area hospitals, Tower Health spokeswoman Jessica Bezler said in an email.

She said the Reading Birth Center also will close Aug. 14.

In addition to the workforce reductions, Matthews said Tower Health will accelerate its ongoing Transformational Excellence program to identify cost savings and performance improvement, while moving toward a more centralized and streamlined model for Tower Health management that will support greater efficiency and faster decisionmaking. These actions, and others in the future, will contribute to the goal of achieving approximately $230 million in cost savings over the next two years, according to the news release.