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Palomar Health to lay off 317 workers, cites 'financial strain' caused by COVID-19 pandemic

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Posted at 1:20 PM, Apr 28, 2020
and last updated 2020-04-28 21:53:59-04

SAN DIEGO (KGTV) -- Palomar Health officials announced Tuesday that 317 employees will be laid off effective April 29 “due to the financial strain caused by the COVID-19 pandemic.”

Officials said the elimination of positions was a result of a 40% to 70% decrease in overall patient visits, and that led to a $5.7 million loss in March. Officials added they expect April “to be worse, yet hard to estimate given the uncertainty of the virus.”

Those employees affected by the move will receive a severance package and immediately be eligible for unemployment and health coverage through the severance period. Palomar Health officials could not give details of what is to be included in the severance package.

The layoffs represent 5% of Palomar Health’s workforce, and of the 317 workers laid off, 50 were clinical RNs with the majority being part-time positions. The other 267 positions are spread across the Palomar Health system, ranging from clerical staff to technicians. About 7% were leadership and management roles.

Palomar Health President and CEO Diane Hansen said, “These are extremely tough decisions that are taken very seriously because we know they affect the livelihood of our employees. However, the sooner we make these tough decisions, the sooner we will be able to stabilize our business and get back on the road to recovery. It is our responsibility to ensure Palomar Health provides high-quality medical care to our community during and after this pandemic.”

Earlier this month, Palomar Health issued a 21-day layoff of 221 employees who were not considered bedside care workers.

"I am disappointed with the vocal few that continue to paint us in an unfavorable light. If they would take the time to actually examine our financial performance, they may understand that these decisions are necessary," said Hansen.

"Many of those individuals that were on a temporary layoff, will come back to work as of this week," said Hansen. "Some of those that were on temporary layoff were impacted in a permanent way today."

Palomar Health, which operates multiple medical centers and clinics in north San Diego County in San Marcos, Poway, Escondido, Ramona and Rancho Bernardo, is far from the only health care provider feeling the impact.

UCSD Health Center has lost more than $50 million in revenue since March, a spokesperson told 10News Tuesday.

The state of California and San Diego County gave the green light last week to hospitals to begin performing elective procedures, if the facility's resources can handle it.

Palomar Health "will resume surgical procedures based on the availability of personal protective equipment and virus testing, but the loss of revenue from shutting down elective surgeries for the past six weeks cannot be recovered quickly," according to a hospital statement.

A federal 202-bed emergency overflow medical facility -- which will not be used unless the county's resources are stretched too thin -- opened last week and occupies two formerly vacant floors of Palomar Medical Center Escondido.

Hospital officials noted that future patient visits may also be negatively impacted by the uncertainties of the economy as patients may lose insurance due to unemployment and delay non-emergency surgeries for more prosperous times.