Mercy Iowa City to layoff 29 employees

The layoffs, which impact positions across the hospital, will be effective Nov. 21

A temporary COVID-19 testing facility outside the emergency entrance is seen at Mercy Iowa City in Iowa City on Wednesda
A temporary COVID-19 testing facility outside the emergency entrance is seen at Mercy Iowa City in Iowa City on Wednesday, March 18, 2020. (Andy Abeyta/The Gazette)

IOWA CITY — Mercy Iowa City plans to lay off 29 employees as a result of financial losses due to the COVID-19 pandemic.

According to a WARN notice filed with the Iowa Workforce Development, the layoffs are effective Nov. 21. Mercy Iowa City, an affiliate MercyOne health system, employs 992 full-time and 196 part-time staff members across its hospital and clinics.

Affected positions come from “a variety of non-specific areas in the hospital,” Hospital Spokesman Aaron Scheinblum wrote in an email to The Gazette.

He noted these layoffs are not specifically tied to the hospital’s inpatient mental and behavioral health unit, which officials plan to close before the end of the year.

The notice was filed Sept. 23, days before hospital officials announced to employees it would close the unlocked inpatient unit. Officials will accept the last patient to the unit on Nov. 1.

The Behavioral Health Unit staffed between 10-12 beds over the past year, according to an inpatient psychiatric bed tracking system by the Iowa Department of Human Services.

“Due to the financial impact of COVID-19, we are in the process of transitioning our unlocked Inpatient Behavioral Health unit in favor of expanding our outpatient service where there is greater community need,” according to a previous statement to The Gazette.


Like all hospitals across the state, the pandemic has had a major impact on Mercy Iowa City’s bottom line. When the first cases of COVID-19 first appeared in March, all Iowa hospitals halted elective procedures — which are health systems’ biggest profit-makers.

The state’s hospitals were expected to lose up to $1.26 billion through the end of June as a result of mitigation measures around the pandemic, according to a cost analysis released by the Iowa Hospital Association earlier this year. After a 395 percent decline in operating margins between March and April, the vast majority of Iowa’s hospitals were operating in the red, according to the analysis.

State law requires companies to post a 30-day notice when 25 or more employees are laid off in a period exceeding six months.

“We reported with a 60-day notice to provide our colleagues more time beyond the mandatory notice to continue to receive pay while seeking current alternative options within the organization or outside of it,” Scheinblum said.

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