Signature cutting more than 100 jobs, blames state; governor responds

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LOUISVILLE, Ky. (WTVQ) – A Louisville-based long-term health care owner that has fought the coronavirus at a number of its locations is now eliminating more than 100 positions in its main offices and regional leadership and making other cost-saving changes.

And administrators at Signature Health Care blame the state for failing to share federal dollars, “squandering” money of a field hospital and other issues the company says contributed to its job cuts.

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But the  state disagreed, saying Signature and every other nursing home in the state benefited from the state’s actions.

“We have had to make some very tough decisions that are nothing short of heart-breaking for our company,” said Signature HealthCARE CEO, E. Joseph Steier, III, who brought the company to Louisville in 2007. “The entire healthcare continuum has been disrupted by COVID-19 in ways never experienced before, and the associated costs have been astronomical, from PPE and additional facility cleaning and sanitizing supplies, to well-deserved additional pay for our frontline hero caregivers.

“Additional costs also covered the increased need for assistance for much or our staff, as schools and childcare have been shut down. All of this, including a census decline from an elective surgery standstill, made a significant impact. Without the additional needed financial support, we have no choice,” Steier continued.

“Perhaps the most frustrating aspect of this situation,” said Chief Operating Officer, Chris Cox, “is how our own state was unwilling to share a portion of the FMAP financing offered by the federal government to assist with our state’s Medicaid patient needs associated with COVID-19. And although our state finally embraced the idea of facility-wide testing for all residents and staff to the point of mandating it statewide, they failed to address the resource needs to accomplish this mandate. It seems they  squandered our state resources on a multimillion-dollar COVID-19 field hospital in Kentucky that was never used, not once.”

The company notes that while it has met “remarkable” challenges at its facilities, it has faced “a lack of much needed funding to support the crucial resources and program changes associated with COVID-19. As a result, “Signature HealthCARE must now
eliminate over 100 support staff and leadership positions from its Home Office in Louisville, Ky. This includes regional leadership positions as well. Other significant cost-cutting measures will also be implemented. Those who are impacted will be offered severance, based on years of service, to help support their transition,” the company said in a statement.

“It’s unfortunate Signature feels the need to layoff people,” Health and Family Services Secretary Eric Friedlander said, citing the fact the state provided coronavirus testing for every nursing home at no charge.

“Every nursing home in the state has benefited from the state’s actions. We have had an aggressive response and it is reflected in our numbers,” Freidlander continued, noting the state’s case and death numbers in nursing homes are much better than most other states.

As one example of the state’s financial assistance, Friedlander noted the state increased the coronavirus bed-hold rate to $270 above the federal rate.

“I don’t know of any state that has been more generous than Kentucky,” Friedlander said.

As for the emergency center at the fairgrounds in Louisville, Beshear said without it, many hospitals  and medical facilities would not have been able to reopen the way we did.

“Reopening would have looked very different,” Beshear said, noting the state had to evacuate several nursing homes, including one Signature facility.

“The field hospital has served as a backup facility in case the beds were needed. That allowed hospitals to return to regular health care,” Beshear  noted.

In addition to the increased utilization of PPE since COVID -19, Signature HealthCARE has seen more than a 200% increase in the per item cost for all PPE such as isolation gowns, masks and gloves, the company said. For example, isolation gowns before COVID-19 were $1.25 each. Now, they are each $8.25. The volume of PPE needed also increased and Signature went from purchasing 1,250 isolation gowns every 45 days to 70,000, the company said.

While some federal stimulus money and other incentives have helped reimburse some of the Company’s COVID-19 expenditures, such funds have fallen short of covering all of them.

For example, under the Families First Coronavirus Response Act, the Federal Medical Assistance Percentage (FMAP) was increased by 6.2% annually for all states to supplement their Medicaid funding.

Out of the 10 states where Signature operates, only a few have committed to providing such funding. Tennessee, Indiana, Alabama, Virginia, and North Carolina all made commitments. Unfortunately, Kentucky did not, the company stated.
Signature HealthCARE is the state’s largest long-term operator with 41 centers, and it was left to shoulder the additional COVID-19 related costs.

“While the rest of the country, including Kentucky, is opening back up from COVID-19, the most vulnerable of our population is still in the middle of this crisis. The Medicaid rate the state pays us to care for our Kentucky elders doesn’t come close to covering these costs,” Steier said. “This is precisely why President Trump issued FMAP funds. But our Governor has said ‘no FMAP money’ to nursing homes and ‘no’ to our frontline staff heroes who care for those who need it most right now and put their own lives on the line every day during this crisis.”

Some of the other financial cutting measures Signature will employ include cuts in support of trade and other association memberships, such as the Kentucky Association of Health Care Facilities (KAHCF).

“We are at a point where difficult decisions have to be made on how to survive,” Steier said. “We know that COVID-19 will not be over in our business any time soon, and even as it may be overcome in the future, our sector and how we do business will never be the same again. I can’t say enough to thank our frontline heroes who continue to serve our residents every day. We will never forget those who we have lost during this crisis. And to those who are now leaving our company, for which we are heartbroken and sorry to see go, their Signature heart and service will always be with us.”