May 13, 2013 4:18 PM by KATC

Hospital layoffs will cost state millions

The state will have to pay about $26 million in annual retirement costs and $42 million in termination pay and unemployment benefits once plans to privatize six of the seven hospitals run by LSU are completed, according to a report released Monday by the Louisiana Legislative Auditor.

Potentially, the state will have to pay $3.8 million in termination pay to UMC employees, and $1.9 million in unemployment insurance. Another $4.5 million would be paid for the ongoing costs of hospital retirees' health and life insurance benefits.

The seven LSU hospitals have already eliminated 1,791 state positions and another 5,287 positions may be eliminated when hospitals are turned over to private companies.

University Medical Center here in Lafayette is among the hospitals that will complete its privatization by June 24. Lafayette General Medical Center will take over UMC.

According to the audit, any active employees will be laid off on the privatization date, meaning the 773 employees left at UMC likely will lose their jobs next month. That is in addition to the 265 positions that have been eliminated over the last three years.


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