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Hurt by Pandemic's Financial Losses, Cape Cod Healthcare Furloughs 600 Employees

Alecia Orsini
Cape Cod Healthcare furloughed more than 600 employees on Thursday.

Cape Cod Healthcare furloughed more than 600 employees Thursday in an effort to heal financial wounds caused by the pandemic.

CEO Mike Lauf said he could no longer keep paying everyone in the face of mounting losses.

“Today was a bad day for Cape Cod Healthcare,” he said.

The furloughs will last at least 30 days.

Hospitals have suspended revenue-generating services and spent money to prepare for a potential surge in patients, which, on Cape Cod, never really materialized.

Lauf said the furloughs cut across the health care system’s multiple locations and affect all types of positions.

At the same time, he announced that his salary and those of executive vice presidents will be cut by 12.5 percent. He took no salary for the month of April.

He said Cape Cod Healthcare will also reduce salaries by 10 percent for vice presidents, 7.5 percent for directors, and 5 percent for managers for the rest of the fiscal year.

“The financial losses that this health care system and this community are taking are historic,” he said. “And I hope that governments at both the federal and state level understand the heavy toll that independent community health systems like ours are facing while being there for our communities.”

The health system operates Cape Cod Hospital, Falmouth Hospital, and numerous outpatient medical centers and physicians’ offices. Revenue has dropped 41 percent.

Lauf said the system received a $26 million government grant, but may have to repay $7 million. Meanwhile, he expects losses to hit $74 million.

He said Cape Cod Healthcare will continue to pay the employer share of workers’ benefits during the 30-day furlough, and he hopes to bring employees back.

“They won’t be taking a salary, but they’ll still be a Cape Cod Healthcare employee,” he said. “And we want to bring them back. It wasn’t our intent to furlough them.”

It’s not clear how much the financial picture could change by this time next month.

Jennette Barnes is a reporter and producer. Named a Master Reporter by the New England Society of News Editors, she brings more than 20 years of news experience to CAI.