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Reimbursement cuts, more charity care prompt layoffs at MultiCare
These are very challenging times in health care. MultiCare Health System is facing major cuts in reimbursement from Medicare and Medicaid, as are all health systems across the country. We also are seeing more laid-off workers seeking health care who have lost their health insurance due to the struggling economy.
Since the recession began in 2008, MultiCare has worked hard to weather the faltering economy and reduced reimbursements, while providing excellent care to the people in the South Sound.
We have implemented cost-savings programs across our health system and will continue to do so.
But we also need to take immediate action to re-size our organization in response to current realities. We will reduce our workforce by about 300 to 350 FTE employees out of our total workforce of 9,400 employees effective Sept. 30. These will not be across-the-board cuts, but instead careful, selected reductions in areas where cost-savings opportunities exist.
To minimize the need to lay off workers, we have asked for volunteers to leave the organization. We are providing severance packages and health insurance benefits to affected employees and other transitional assistance.
State budget cuts for the 2011-2013 biennium will result in $37.6 million less to MultiCare with $10 million of those cuts occurring in 2011. About half of the patients seen in MultiCare hospitals and clinics use Medicare or Medicaid, therefore cuts to those programs have a significant impact.
Through May of this year, our Charity Care that we provide to those in the community who ask for assistance combined with write-offs for patients who cannot pay are $14.8 million dollars more than the same period last year.
Reducing our staff is a difficult but necessary action for us to take. None of these reductions will affect the quality of care we provide every day or our commitment to providing care for people regardless of their ability to pay.
As a not-for-profit locally governed health system, MultiCare has been providing care services to our community for 130 years since the opening of Tacoma's first hospital. We continue to be dedicated to providing quality care to our region and making care more efficient and affordable for our patients.
Posted on Jul 12, 2011 in