Montefiore Hospital Replaces 12 Nurses with AI Software

A Bronx hospital has laid off a dozen nurses and replaced them with artificial intelligence software, according to their union, in what may be one of the first AI-driven workforce reductions in American nursing.

Marilyn Shuler, a utilization review nurse with 39 years at Montefiore hospital, was among 12 nurses terminated on a Sunday in early July. The New York State Nurses Association (NYSNA) says the hospital deployed AI-powered software to perform work these nurses had done for decades—reading patient charts and coordinating with insurance companies over coverage decisions.

Contract dispute emerges

The layoffs arrive months after a major nurses strike across multiple New York City hospitals in January 2026. Union representatives say the new contracts negotiated after those strikes included explicit protections against AI displacement.

Shaiju Kalathil, a Montefiore nurse and union executive committee member, called the terminations a direct contract violation. "These dedicated nurses are being replaced by AI," Kalathil said in a statement. "This is a violation of the contract that we recently won by going on strike."

Shuler and her colleagues noticed workflow changes when they returned from the strike in February, but received no explanation from management. After the union sent an inquiry email, the hospital remained silent until May 28, when all 12 nurses received 45-day termination notices.

Clinical judgment versus automation

Utilization review nurses handle complex communications around medication adjustments, discharge planning, and insurance authorization—tasks Shuler argues require human expertise. "AI should be a tool used in conjunction with the clinical expert, not to replace," she said. "We're not against technology. The issue is with new tech without evidence."

Montefiore senior vice president Joe Solmonese defended the changes, stating the hospital is "always investing in new technology to ensure the best care and outcomes for our patients." He characterized the AI implementation as affecting a "nonclinical program involving paperwork," though he did not address the layoffs directly.

Why it matters

This case represents an early collision between healthcare AI adoption and labor protections. National Nurses United, NYSNA's parent organization, has developed an AI bill of rights and pushed for legislative guardrails, warning that hospitals will use automation to cut costs at the expense of care quality. President Jamie Brown noted that "hospital employers will find any opportunity to cut costs and cut corners on patient care and nurse staffing."

The outcome of this dispute could establish precedent for how AI displacement is handled under collective bargaining agreements in healthcare—a sector where automation is accelerating but clinical judgment remains critical.

These details were first reported by The Guardian.