John Muir Health Offers Workers Voluntary Buyouts Ahead of ACA
On Thursday, a California health care system announced that it will offer workers at two hospitals voluntary severance packages in an effort to save money ahead of Affordable Care Act implementation, the Contra Costa Times reports.
The move comes one week after the not-for-profit company said that it plans to sell its MuirLab business and lay off 540 employees in the division.
Details of Buyouts
John Muir Health announced that it will offer buyouts to employees at facilities in Walnut Creek and Concord. The health system hopes to cut about 200 full-time positions.
Ben Drew -- a spokesperson for Muir Health -- said that the health system is not asking doctors to leave.
The company seeks to cut $23 million in labor costs as part of a plan to save $52 million over the next two years.
The voluntary buyout program would reduce Muir's workforce by about 4%.
Drew said that layoffs could occur if there are not enough employees who take the voluntary buyouts.
Effects of the ACA
Drew said that the company is "being paid less" under the ACA and that it needs to "make changes for the future."
In a letter sent to employees on Tuesday, Muir President and CEO Cal Knight wrote that the company's "current costs are not sustainable in the long run," adding, "We must take proactive steps to preserve our ability to deliver great care in the midst of growing patient concerns about health care costs and the most profound changes to health care in decades."
Knight also said that Muir currently has higher staffing rates than 75% of hospitals with "similar recognitions for quality" (Gafni, Contra Costa Times, 9/12).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.