PORT ST. LUCIE — Liberty Medical Supplies announced Tuesday plans in two months to lay off 250 employees from its Port St. Lucie location after the company's new owners opted to exit the Medicare fee-for-service business in early 2013.
Employees will be given severance packages depending on their positions, Chief Executive Officer and Chairman Frank Harvey said. Some of the company's outgoing business will turn over to Coral Springs-based Arriva Medical. Harvey said Arriva Medical probably will hire several hundred employees from Liberty Medical for at least six months.
Liberty Medical also announced the company will layoff 200 employees at Salem, Va. where the company has about 350-400 employees, Harvey said.
The company now has between 1,200 and 1,300 employees at its Port St. Lucie location, Harvey said.
"It's a really tough decision," Harvey said. "We didn't want to let the company get too far down the line so it wasn't able to come back and we (would have) had so much debt on us that we weren't able to be profitable and had to face a bankruptcy.
"So before we went into that situation, we just wanted to make sure that we focused on the profitable areas for the company, so we could have a company that can be here for a long period of time and one that can employ over 1,000 employees."
Less than two weeks ago, a group of executives working for the Port St. Lucie-based company bought Liberty Medical from its new parent company, Express Scripts Inc. Local officials applauded the move as a sign the county's top private employer would remain in Port St. Lucie.
The pharmacy benefit giant Express Scripts had announced plans to look at different options regarding Liberty Medical, and employees have faced layoffs and uncertainty after its parent company, Medco Health Solutions, merged with Express Scripts in April. Liberty Medical was a tiny portion of the $29 billion deal, and Express Scripts made it clear the diabetes equipment supply company would not be part of future plans.
Harvey said that Medicare reimbursement cuts in certain products have made those products unprofitable, but the company will remain in Medicare Advantage. The company will focus on selling supplies in the commercial diabetes sector, insulin pumps, home-care products such as catheters and pharmacy areas.
"We have to make the decisions sooner rather than later . . .to stay profitable and stay in business," Harvey said.
Harvey said the company has no plans for future layoffs.
"Our hope is that by the end of third and fourth quarter of this coming year as we grow in these other areas, we can start to hire some of these employees back into the organization," he said.