Montrose hospital restructuring cuts 77 positions

Montrose Regional Health (MRH) reduced its workforce by 77 positions effective Oct. 12 as
part of an organizational restructuring plan. This included 34 current employees and 43
positions left vacant through natural attrition. The reduction included 12 leadership roles,
three physicians, three advanced practice providers, and 59 other positions across the
organization. Of the 77 positions, 36 were direct patient care roles and 41 were non-direct
patient care roles.
MRH experienced approximately 10% growth in patient services over the past year.
However, cash payments from insurance companies remained essentially flat while labor,
supplies, and other operating costs continued to rise. Approximately $25 million in
payments from insurance companies remain outstanding for care already provided. These
pressures are not unique to MRH. Hospitals across Colorado and the nation also face rising
costs and reimbursement that has not kept pace with the cost of care.
Before deciding that a reduction in force was necessary, MRH restricted hiring and capital
spending, reduced operating expenses, limited community sponsorships and donations,
reviewed contracts and purchased services, used rebate programs to lower medication
costs, and pursued overdue insurance payments. These measures helped but did not close
the financial gap.
“Reducing our workforce is one of the most difficult decisions we can make because it
directly affects people who have contributed to MRH and our community,” said Jeff
Mengenhausen, CEO of Montrose Regional Health. “We are incredibly grateful for the
service of the caregivers affected by these changes. At the same time, we have a
responsibility to ensure that MRH remains financially sustainable and able to provide high-
quality healthcare to this community for generations to come.”
“The Board of Directors is committed to maintaining a financially strong and independent
community healthcare system,” said Jack Johnston, board chair. “Rural healthcare systems
face unique challenges in an increasingly complex industry. After careful review, we believe
these steps are necessary to ensure MRH has the structure and resources needed to
protect and strengthen the nationally recognized care our community depends on.”
Patient safety, quality of care, and continuity of care guided MRH’s decisions and remain
priorities as these changes are implemented. MRH does not anticipate changes to critical
hospital-based services as a result of the restructuring. Other service changes include
discontinuing cardiology services in Telluride, reducing pediatric occupational therapy
availability, scaling back several therapy wellness programs, and consolidating the Sleep
Clinic with the Pulmonary Clinic.
The workforce reduction is expected to reduce annual expenses by more than $8 million
while helping MRH align ongoing expenses with sustainable cash collections, improve cash
flow, and pay vendors more consistently. MRH will continue pursuing outstanding insurance

payments, managing expenses, and supporting access to high-quality healthcare
throughout the region.

QUESTIONS-
1. Why did MRH eliminate positions?
MRH continues to face financial pressure because insurance payments have not kept pace
with the growth in services, while labor, supplies, and other operating costs continue to rise.
Approximately$25 million remains outstanding from insurers, and previous cost-saving
measures were not enough to close the financial gap.
2. What did MRH do before eliminating positions?
MRH spent more than a year reducing expenses and improving revenue and collections.
Actions included hiring restrictions, operating and capital expense reductions, limits on
community sponsorships and organizational donations, contract and purchased-service
reviews, reducing medication costs through available rebate programs, and legal efforts to
collect overdue insurance payments. Unfortunately, those measures were not enough to
close the financial gap.
3. How many positions were eliminated, and how many employees were affected?
On Oct. 12, MRH eliminated 77 positions as part of its restructuring plan; 34 employees
were laid off, and 43 positions left vacant through attrition will not be filled.
4. Which types of positions and departments were affected?
The reduction included 12 leadership roles, three physicians, three advanced practice
providers, and 59 other roles across clinical and nonclinical areas. Of the 77 MRH positions,
36 were direct patient care roles and 41 were non-direct patient care roles.
5. Did MRH also reduce traveler contracts?
The 77 positions did not include contracted travelers. Separately, MRH has reduced its use
of contract travelers by 12 assignments since June 1. Some contracts ended early, some
were not renewed, and some planned assignments were canceled before they began. MRH
will continue using travelers in select direct patient care roles where needed to maintain
safe, high-quality patient care.
6. Were other positions eliminated before Oct. 12?
Before Oct. 12, MRH had been reviewing its organizational structure and making changes
as vacancies and other operational opportunities occurred. Those changes included
consolidating responsibilities and eliminating some positions as part of MRH’s broader effort
to operate more efficiently. MRH does not comment on individual personnel matters.
7. How does this help financially?
The workforce reduction is expected to reduce annual expenses by more than $8 million. It
is part of a broader organizational restructuring intended to align recurring expenses with
sustainable cash collections, improve cash flow, address overdue vendor balances, support
more timely vendor payments, and position MRH for long-term financial stability. It will also
help preserve MRH’s ability to invest in the future of local healthcare.
8. What is MRH doing about the unpaid insurance claims?

MRH continues pursuing payment for outstanding insurance claims through collection

efforts and legal action.
9. How were positions selected?
Positions were evaluated based on organizational structure, staffing needs, service
volumes, responsibilities, duplication of work, and management structure. Patient safety,
quality, and access were primary considerations throughout the process. The reduction was
driven by financial and organizational needs. Many talented, dedicated employees were
affected because their positions were eliminated, not because their contributions were
unrecognized or unvalued.
10. Will patient care or services be affected?
Patient safety and quality remain MRH’s priorities, but some services are changing as part
of the restructuring. MRH does not anticipate changes to critical hospital-based services.
MRH has discontinued cardiology services in Telluride, reduced pediatric occupational
therapy appointment availability, and scaled back several therapy wellness programs. The
Sleep Clinic is also relocating and being combined with the Pulmonary Clinic at 715 S. Third
St. Sleep services will continue at the combined location. MRH is communicating directly
with affected patients and referring providers. MRH does not currently have specific
projections for caseload or wait-time changes related to the affected services. Leaders will
monitor scheduling, capacity, and patient access and adjust as needed.
11. Is this related to the Community Hospital partnership?
MRH remains committed to preserving its independence and local decision-making. The
proposed Community Hospital partnership is a separate, long-term strategy intended to help
both organizations preserve their local independence through greater scale, shared
resources, and operating efficiencies. It does not replace the need to address MRH’s
immediate financial challenges.
12. Is MRH the only hospital facing these financial pressures?
MRH’s financial challenges reflect a combination of delayed insurance payments,
reimbursement that has not kept pace with the rising cost of care, and increasing labor,
medication, supplies, and operating costs. Hospitals across Colorado and the nation are
facing many of these same pressures. Nearly 70% of Colorado hospitals are operating with
financially unsustainable margins, and more than 60 hospitals and health systems
nationwide have announced workforce reductions in 2026.
Sources: Colorado Hospital Association, Colorado Hospital Industry Update; Becker’s
Hospital Review, The Hospitals and Health Systems Cutting Jobs in 2026.
13. Will there be additional layoffs?
MRH does not have additional workforce reductions planned at this time. The organization
will continue monitoring its financial position and will communicate openly if circumstances
change.