UC San Diego Health laid off about 230 workers, approximately 1.5% of its workforce, on Monday, citing mounting financial headwinds and concerns about potential policy change in Washington.
“The decision was made solely in response to mounting financial pressures caused by federal impacts to health care, regulatory uncertainty, and rising costs of providing care combined with reimbursement rates from Medicare, Medicaid, and insurers that fail to keep pace with the true cost of care,” a spokesperson said by email.
The University Professional and Technical Employees, a union which represents some of the impacted workers, said that the layoffs affected some front line positions and could jeopardize patient care.
The union said the cuts came even though University of California holds more than $26 billion in liquid reserves, in an effort to tie the financial health of the medical system to the larger academic system.
UC San Diego Health stressed that it is not alone in conducting workforce adjustments, noting “reductions in personnel are being experienced by health systems across the nation.”
This year, PeaceHealth, Providence, NewYork-Presbyterian Health System, University of New Mexico Hospital, Penn Medicine, Yale New Haven Health, Mass General Brigham, Jefferson Health and Lehigh Valley Health Network have all let workers go or consolidated their leadership teams, citing concerns about growing headwinds and financial challenges.
Health systems are shedding workers as they await the final fallout of Congress’ reconciliation bill, which would slash funding for Medicaid.
The House narrowly passed the legislation late last month, which called for significant cuts to the program, work requirements and increased eligibility checks. This month, Senate Republicans released their own version of the bill, which included even deeper cuts to Medicaid.
Should the legislation pass, it could have drastic impacts on providers’ revenue, experts say. Additional healthcare layoffs would likely follow, warns a report from the Commonwealth Fund and the George Washington University Milken Institute School of Public Health.
Nearly 500,000 healthcare workers would lose their jobs if cuts to Medicaid and food assistance pass in Congress, including those working in hospitals, physician offices, pharmacies and long-term care facilities, according to the report.
