Contract Termination Brings End to Years of Outsourcing
*KALAMAZOO, MI* — More than 260 contract employees who provide services for Beacon Health System will need to reapply for their positions if they wish to keep them, according to WARN notices filed with the Michigan Department of Labor and Economic Opportunity.
The 262 employees, who work for TouchPoint Support Services and parent group Compass Group USA, are being laid off as Beacon prepares to bring nutritional, environmental and transport services in house in Southwest Michigan.
The layoffs will take effect on July 1, the same day that Beacon's contract with TouchPoint ends, according to a Worker Adjustment and Retraining Notification notice filed with the state.
Compass Group USA filed a similar notice with the state last May, when a series of WARN notices announced the layoff of 244 employees prior to Beacon Health System acquiring the Ascension health care system. Those layoffs never occurred, however, confirmed Elizabeth Long, Beacon Health System spokesperson for Southwest Michigan.
"While TouchPoint had communicated the potential workforce reductions in advance of the acquisition, that agreement averted any layoffs and no workforce reductions occurred then," Long said.
Instead, Beacon Health worked with TouchPoint and Compass Group USA to establish a new service agreement prior to the July 1, 2025 acquisition.
"As a locally-owned, locally-led system, integrating these services allows us to better align with our mission, improve efficiency and reinvest resources when they matter most," Long said.
Four Hospitals and Fitness Center Affected
Beacon will offer employment opportunities in these service areas and encourages current TouchPoint employees to apply through Beacon's standard hiring process.
The WARN notices detail the following facilities and the approximate number of employees impacted at each location:
Beacon Kalamazoo — 222 employees:
- 91 housekeepers
- 73 involved in food and dining service, including cashiers, cooks, dishwashers, and chefs
- 29 involved with patient transport
- 11 dietitians of all levels
- Five shift supervisors
- Three in retail
- 10 other positions
Beacon Allegan — 13 employees:
- Six housekeepers
- Seven in food and dining service
Beacon Dowagiac — 11 employees:
- Six in food and dining service
- One dietitian
- One shift supervisor
- Two housekeepers
- One janitor
Beacon Plainwell — 9 employees:
- Four in food and dining service
- Four housekeepers
- One director of environmental services
Beacon Health and Fitness Center, Kalamazoo — 7 employees:
- Six housekeepers
- One shift supervisor
Acquisition and Integration Timeline
The acquisition included hospitals in Kalamazoo, Dowagiac, Plainwell and Allegan, 35 outpatient clinics and an ambulatory surgery center.
While Beacon extended the agreement with TouchPoint for one year, it is now moving its nutritional, environmental and transport services in house across those four hospitals and a health and fitness center in Kalamazoo.
"Beacon will offer employment opportunities in these service areas and encourages current TouchPoint employees to apply through Beacon's standard hiring process," Long said.
Impact on Local Workforce
The exact number of each position that will be available and recreated by Beacon is not known at this time, Long said.
This announcement comes after Beacon Health System acquired the Ascension health care system, which included multiple facilities across Southwest Michigan. The integration of services has been ongoing since the acquisition closed in July 2025.
The transition represents a significant shift in how Beacon Health delivers essential services, moving from a contractor-based model to an in-house approach that aligns with the system's locally-owned, locally-led philosophy.
What This Means for Employees
The WARN notices list the following positions as being eliminated by Compass Group USA across Beacon facilities:
- Housekeeping staff
- Food service workers and culinary staff
- Patient transport personnel
- Dietitians at various levels
- Shift supervisors
- Retail employees
- Administrative assistants
- Custodians and janitorial staff
- Environmental services directors
Beacon Health System has not yet announced when applications will open for the repositioned roles or what the application process will entail.
Current TouchPoint employees are being encouraged to apply through Beacon's standard hiring process, though the exact number of positions available in each category remains undetermined.
Beacon's Statement
Beacon Health System spokesperson Elizabeth Long provided the following statement regarding the workforce changes:
"Beacon Health System is bringing nutritional, environmental and transport services in-house at Beacon Kalamazoo, Beacon Allegan, Beacon Dowagiac and Beacon Plainwell hospitals, as well as Beacon Health and Fitness Kalamazoo, effective July 1, 2026, upon conclusion of an agreement with Compass Group USA, Inc.
"While TouchPoint had communicated the potential workforce reductions in advance of the acquisition, that agreement averted any layoffs and no workforce reductions occurred then.
"Beacon Health System is a locally-owned, locally-led system, and integrating these services allows us to better align with our mission, improve efficiency and reinvest resources when they matter most."
Community Impact
The announcement affects facilities across Calhoun County, Allegan County, and Van Buren County, with the largest concentration of impacted workers at Beacon Kalamazoo's 1521 Gull Road location.
The transition represents a significant change in Beacon's operational structure, as the system moves from outsourcing essential services to managing them directly with its own staff.
Sources
- https://www.mlive.com/news/kalamazoo/2026/03/262-beacon-support-staff-face-layoffs-as-contract-ends-must-reapply-for-jobs.html
- https://wwmt.com/news/local/beacon-layoffs-compass-group-usa-inc-workers-lose-jobs-262-kalamazoo-allegan-plainwell-dowagiac-health-hospital-wwmt