While there are still plenty of healthy sectors in the healthcare industry, hospitals have been taking it on the chin lately. In fact, financial cutbacks and layoffs have been skyrocketing of late, with some 50 hospitals or health systems in 21 states publicly announcing layoffs totaling about 3,400 positions, according to the Healthcare Financial Management Association.
Here are some of the larger, more important cuts:
- Vanderbilt University Medical Center cut about 1,000 jobs in late 2013. According to executives there, this round of layoffs is part of the organization's plan to cut $250 million operating budget over the next two fiscal years.
- Alta Bates Summit Medical Center is planning to lay off 358 employees at its Berkeley and Oakland campuses and close its skilled nursing facility and infusion center. The medical center's average daily patient count dropped 18.3% between 2010 and 2013, and labor hours fell a disproportionate 5.7% during the same period. Executives there say that the layoffs and service cuts are part of a long-term effort to restore the system to financial health.
- Cleveland Clinic announced late last year that they would be offering 3,000 buyouts to employees in an effort to cut costs. Executives laid part of the blame on the ACA, but also the $9.9 billion in government sequester for Medicare, hospital debt and states' refusals to expand Medicaid.
- In New York, two hospitals may be making massive cuts to their staff roster early this year. In one instance, the financially troubled Long Island College Hospital filed a notice with the state Department of Labor that as many as 1442 employees could be laid off by early February. Meanwhile, bankrupt Interfaith Medical Center was planning to fire 1545 workers until the state promised to give funding to keep the hospital opened through March 7.
Many other hospitals are planning or have already executed staff cuts. With cash now freed up for new activities, 2014 is looking like the year hospitals begin executing their turnaround plans in earnest. The question is, will more massive layoffs or other reductions in force be necessary this year, too?