Daughters Of Charity Slashes Jobs

Just weeks after a proposed acquisition of its hospitals by Prime Healthcare Services fell through, the Daughters of Charity Health System cut hundreds of jobs throughout the organization as a cost-cutting measure, it acknowledged on Wednesday.

Altogether, 4% of Daughters of Charity’s workforce was laid off, the Los Altos Hills-based not-for-profit announced in a statement. That represents some 280 employees, with cuts coming throughout the organization. 

The layoffs, which took place on April 13, are part of what Daughters of Charity termed operational improvement plans “that include strategies to reduce expenses, stabilize finances and better position our hospitals while we search for a new buyer.” In addition to the job cuts, Daughters of Charity also said it will be closing down several community clinics and cut service lines at some of its hospitals over the next 90 days, although no specifics were immediately available.

The six-hospital Daughters of Charity includes two acute care facilities in Los Angeles and Lynwood, and four others in the Bay Area and Silicon Valley.

The chain had been in dire financial straits and was losing more than $10 million a mont, when it entered into a controversial deal to be acquired by the for-profit Prime, which has drawn scrutiny from both California and federal regulators for its business practices, including billing at high volumes for relatively rare medical conditions and release a patient’s medical information for media purposes without their consent.

After months of scrutiny, Attorney General Kamala Harris signed off on the transaction, but attached additional conditions to which Prime said it would not acquiesce. It withdrew its offer last month.

Daughters of Charity said the cuts in jobs and services -- the former of which which be negotiated with labor unions who represent its workers -- are expected to put its operations closer to break-even. It said it also has entered into discussions with other unnamed buyers.

“Since re-entering the market..we have potential buyers interested in purchasing the entire health system, individual hospitals and hospitals in a market,” Daughters of Charity said in its statement.