ELLSWORTH, Maine — Maine Coast Memorial Hospital on Wednesday announced 14 employee layoffs and unspecified reductions in executive compensation, citing backlogged Medicaid reimbursements and economic hard times.
The 60-bed hospital’s vice president for marketing, Kristin Tardiff, said 12 full-time and two part-time employees were laid off Wednesday morning, effective immediately. The cuts include positions in administration, laboratory and clinical services, she said.
In addition, another eight positions that are currently vacant will not be filled, and some of the hospital’s top executives, including Chief Executive Officer Doug Jones, will take a reduction in their compensation packages, Tardiff said.
Tardiff declined to provide more specific information about the compensation cuts. In a recent Bangor Daily News survey of CEO compensation at Maine hospitals, Jones’ annual salary and benefits totaled $310,304.
The cuts are expected to save the hospital about $900,000 a year and are needed to help it weather the general economic downturn, especially given the state of Maine’s failure to keep up to date on payments from MaineCare, the state’s Medicaid program for low-income and disabled residents, Tardiff said. According to a recent estimate from the Maine Hospital Association, Maine Coast Memorial Hospital is owed about $7.6 million in Medicaid funds dating back to 2005.
Gov. John Baldacci and the Legislature have pledged to use federal stimulus funds to pay off a portion of what is owed to Maine hospitals, but the money is not yet available.
Though the decision to lay off some of its 700 employees was “heart-wrenching,” Tardiff said that overall Maine Coast Memorial Hospital, the second-largest employer in Hancock County after The Jackson Laboratory in Bar Harbor, remains a “longstanding and stable hospital” that contributes more than $43 million a year to the local economy.