The St. Charles Health System, headquartered in Bend, announced it will lay off 105 caregivers and eliminate 76 vacant positions. That’s a roughly 4% cut to its overall workforce. The people who will be laid off had not yet been told their fate on Wednesday afternoon when hospital leaders made their announcement.

St. Charles leaders said challenges brought about by the COVID-19 pandemic have pushed the health system into financial distress and it has incurred $21.8 million in operating losses this year through April, a 6.7% operating loss.

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A person walks down a crowded hallway filled with medical equipment in the emergency room.

The Emergency Department at St. Charles hospital in Bend, Ore., on March 19, 2019, a year before the pandemic began to seriously affect the hospital's finances.

Emily Cureton / OPB

The cost of hiring short-term contract workers, including “traveling nurses” who command a higher rate than local, full-time nurses, contributed to the hospital’s bad financial position, according to a statement released by the hospital Wednesday. Increased equipment and supply costs and federal loan repayment have also contributed.

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Other care providers in rural Oregon have said they too are being hit hard by sky-high contract labor costs due to a nationwide staffing shortage of nurses, certified nurses assistants, and pharmacists that has led to fierce competition for people willing to travel for temporary work.

In south Central Oregon, the Lake Health District has also reported steep operating losses this year due to contract labor costs, and is considering reducing services.

In some cases, the district has no applicants for essential jobs, the Lake County Examiner reported.

In Tillamook County, a nonprofit nursing home operator cited contract labor costs as a major reason for closing two assisted living facilities that had served the county’s Medicaid recipients.

Statewide data on hospital finances shows that many larger health systems have offset their operating revenue losses during the pandemic with gains in the portfolios of stock that they hold.

The St. Charles Health System is the largest employer in Central Oregon.

This is an evolving story. Watch for updates.

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