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Cape Cod Healthcare announced Thursday, May 7, that more than 600 full-time employees out of its total workforce of 5,700 will be placed on furlough beginning next week.

Michael K. Lauf, Cape Cod Healthcare's president and chief executive officer, said the organization has made every effort over the past eight weeks to keep paying every employee, but with a 41 percent revenue loss and a projected $74 million loss by the end of the fiscal year, it is unable to keep the effort going.

The furloughs will go into effect on Sunday, May 10, and will be in place for at least 30 days.

Mr. Lauf said the furloughed employees will continue to receive their benefits as employees of Cape Cod Healthcare, but they will be placed on unpaid leave.

In addition to the furloughs, executives, vice presidents, executive directors and managers are all taking pay cuts ranging top-down from 12.5 percent to 5 percent. Mr. Lauf, who did not take his salary for the month of April, will be taking a 12.5 percent pay cut. Those cuts will last through the end of the fiscal year.

Cape Cod Healthcare is one of only two healthcare systems in the state that have continued to fully pay their entire staffs to this point, Mr. Lauf said. Many other organizations have already laid off staff.

The revenue loss comes as a result of having to cancel services such as elective surgeries and outpatient testing as the coronavirus pandemic hit the country. Mr. Lauf said Cape Cod Healthcare had wanted to keep its staff employed for as long as possible, adding it is facing historic financial losses and is no longer able to wait for the virus to pass.

“We truly hoped that by May 4 we would be out of this. That did not occur,” he said.

The affected employees will not include front-line medical workers, and Mr. Lauf said that no bedside nurses will be placed on furlough. All other positions will be affected, including vice presidents, parking attendants and physicians.

Mr. Lauf said the only financial assistance that Cape Cod Healthcare has received is a $26 million loan from the federal government, of which it will be expected to pay back $7 million. Without further assistance, this is where the company is at right now, he said.

He noted that he thinks, given the sacrifices that the system has made in regard to its own business model to address the global pandemic, that more assistance should be given.

Because the Cape Cod Hospital emergency room gets particularly busy during the summer months, Mr. Lauf said, furloughing instead of laying off staff will ensure that if the hospital gets busier, staff will be ready to return to work as the demand grows.

Acknowledging that it was a grim day for the organization, Mr. Lauf said Cape Cod Healthcare is going to learn from this moment in time and dust itself off and rebuild as soon as possible.

“This is a sad day for me,” he said. “I never thought in my 12 years here that I would have to do what we did today.”

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