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The parent company of Harvard Pilgrim Healthcare and Tufts Health Plan cited rising medical and drug costs as the reason for the layoffs.

On Monday, Point32 Health announced that it would be laying off 254 employees, marking the second round of job cuts this year. This move, according to the nonprofit organization, is aimed at cutting down administrative expenses, as the costs associated with medical care and pharmaceuticals continue to climb at unprecedented rates.

Earlier in the year, in March, the company had already reduced its workforce by 110 positions. “This was an extremely difficult decision because it will affect so many talented and dedicated colleagues,” stated Patrick Gilligan, President and CEO of Point32 Health.

Currently, the company employs around 4,000 people and serves nearly 2 million members across the state, as reported on their website. Gilligan emphasized, “Our members are at the heart of everything we do. It’s crucial to manage costs that are within our control.”

Point32 recently reported an operating loss of $96 million on revenues of $4.9 billion, mainly attributed to steep expenses related to drugs for diabetes, oncology, and targeted treatments for autoimmune and heart conditions. Interestingly, while this loss is significant, it did improve compared to the same period last year when the company faced a $155 million operating loss on revenues of $4.7 billion.

It’s not just Point32 feeling the pinch. Blue Cross Blue Shield of Massachusetts, the largest insurer in the state, revealed earlier this month that they are offering retirement incentives to employees aged 55 and over with at least a decade of service. They’ve stated that while they don’t currently plan to layoff staff, they haven’t ruled out that possibility either.