- Banner Health has completed a major restructuring that resulted in elimination of 500 jobs, including chief administrative officer, Becker’s Hospital Review reports.
- The Phoenix-based health system also created a new position, chief strategy officer, and shifted additional responsibilities to the chief operating officer and chief clinical officer.
- In March, Banner said it hopes to save $65 million this year through a voluntary worker termination program.
Uncertainty about the future of the Affordable Care Act (ACA) has sent health systems looking for ways to rein in spending, and labor costs are a key target. Last year, both MD Anderson Cancer Center and Catholic Health Initiatives announced layoffs in response to operating losses.
Cleveland Clinic CEO Toby Cosgrove said recently that 52% of U.S. hospitals face similar concerns — including his own, which suffered a 71% drop in operating income in 2016. He blamed the situation in part on new regulatory and administrative burdens that health systems were inadequately funded for.
A December analysis by healthcare economics firm Dobson DaVanzo found that repealing the ACA without an immediate replacement plan could cost hospitals $165.8 billion in federal payments through 2026. While the House has now passed legislation to repeal and replace the ACA, it’s estimated the American Health Care Act would lead to as many as 20 million people losing health insurance and would drastically reduce Medicaid funding.
Hospitals in states that expanded Medicaid under the ACA have seen finances improve, but the current uncertainty has led to frozen capital expenses as well, former CMS acting Administrator Andy Slavitt said in a tweetstorm earlier this year. Medicaid expansion led to less debt and reduced ER visit rates in most states
The Senate is drafting its own ACA repeal bill, but there is no clear timeline for moving that forward.