Ozarks Community Hospital laying off up to 60

Ozarks Community Hospital is laying off up to 60 employees or 12 percent of its workforce in the Springfield area, according to a letter that the hospital CEO sent to a Missouri program that helps displaced workers.

CEO Paul Taylor wrote in the letter, dated Wednesday, that the layoffs began that day. The hospital has about 500 employees in the Springfield area and about 800 employees in the company.

"Beginning today, we are providing notice to employees that we are laying off as many as 60 employees in 60 days," Taylor wrote. "The affected employees will continue to receive their normal compensation and benefits through the 60-day period — though most of them will not be required to come in and work if their patient service department does not need them."

Taylor blamed the layoffs on Missouri's failure to expand Medicaid. He wrote that OCH is hiring in Arkansas.

"Even if Missouri expands Medicaid in the future, it will be virtually impossible for us to recapture this loss of capacity," Taylor wrote. "Hospitals cannot shrink and expand as readily as other industries. I fear that Missouri will never recover the ground it is now losing statewide as a result of political posturing."

OCH is the second Springfield hospital this month to announce layoffs. Mercy has eliminated 42 positions in Springfield in non-patient care support areas.

The 45-bed, for-profit hospital was opened in 2000 by SGOH Acquisition, a Missouri corporation owned by Ozarks Community Hospital CEO Taylor and 21 doctors at the Springfield hospital.

The hospital has struggled financially for years. Occupancy at the hospital dropped from about 44 percent in 2010 to about 36 percent in 2012, according to the state Department of Health and Senior Services. The hospital had a net operating loss of $1.2 million in 2012, the lastest year available, according to DHSS.

SGOH had never been able to pay a dividend to its shareholders, so in 2007 the hospital decided to seek nonprofit status to be able to compete with CoxHealth and Mercy Springfield. The Internal Revenue Service rejected the hospital's application for reasons the agency won't disclose.

In 2011, physicians who owned shares in SGOH Acquisition Inc. divested those shares because of provisions in the new federal health care law. That law prevented most of the doctor-owned hospitals across the United States from expanding.