West Texas Small Town Hospitals Laying Off Employees, Cutting Services

- ABILENE, TX -- According to Bloomberg U.S. hospitals have dismissed 5,000 employees since June 2013. West Texas hospitals say budget cuts are related to a decrease in reimbursements from certain healthcare providers.

“They [insurance companies and government programs] decide how much they’re going to pay us,” said Keith Butler, interim CEO of Hamlin Memorial Hospital. “We don’t have any negotiating room with them.”

Hamlin had to lay off half a dozen employees in March. For example, Butler said, the reimbursement rate will no longer support the birth of babies in his community. Stamford Memorial Hospital, also seeing the effects, had to cut back major programs at their facility directly related to the decrease in reimbursement rates. 

“Those reimbursements just continue to decline,” said Rick Defoore, CEO of Stamford Memorial Hospital. “The only way to get a handle on that is to reduce costs.”

“The number one expense is employees,” Defoore said.

“This is happening all over the nation,” Butler said. “More and more rural hospitals are suffering.”

“In the United States and in Texas we provide heathcare for free to people who can’t afford it.” Defoore said. “But if that number continues to rise it’s going to get to the point where ‘Who is going to pay for it?”

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