Generally woodpeckers only use rotten or dead trees to build in. I expect the tree is barely hanging in there and you might as well leave it for the birds. Sorry. lmw

I don't know what the problem is with your tree (what species, by the way?) but it's not woodpecker damaage. The only woodpecker in your neck of the woods that feeds of healthy trees would be the yellow-bellied sapsucker, which makes dozens of small holes in the bark, in parallel rows, to make the sap run and attract bugss. Sapsuckers can damage trees under some circumstances -- smaller trees in fruit orchards, for example -- but that doesn't sound like your situation.

If woodpeckers are digging 8" holes in your tree, there is either a good supply of insects living in your tree or else the tree is rotten enough to be a candidate for a nest hole. The bugs could either be the problem themselves or (more likely) they have moved into dead tissue caused by disease. Either way, the woodpeckers are more of an indicator of a problem than the cause.

If the tree is important to you, you should hire a professional arborist to evaluate the problem.