Kaiser Permanente Cuts 1,850 California Jobs, Unions Express Concern
On Tuesday, Kaiser Permanente announced that it has eliminated 1,850 positions in California in response to declining membership, reductions in Medicaid reimbursements and other financial concerns, the Sacramento Bee reports (Kasler, Sacramento Bee, 8/12).
The Oakland-based HMO cut about 650 administrative and service positions in Southern California and about 1,200 positions in the northern region of the state.
The job cuts will not affect any physician positions (Hsu, Los Angeles Times, 8/12).
Marc Brown, Northern California spokesperson for Kaiser, said the affected employment classifications include:
- Health information management clerks;
- Housekeeping staff;
- Local business office workers;
- Medical and transcription secretaries;
- Pharmacy clerks and technicians; and
- Unit assistants (Rauber, San Francisco Business Times, 8/11).
During the first half of the year, Kaiser's membership declined by 36,000 members, the company said last week.
During the same period, Kaiser reported a gain in net income compared with the first six months of 2008. However, the company also noted that its second-quarter operating profits declined by 18% compared with the previous year.
Earlier in the year, Kaiser attempted to cut costs by canceling open job positions, deferring certain merit pay increases, laying off non-union personnel and reducing staff numbers through attrition and limited hiring (Los Angeles Times, 8/12).
Effect on Unionized Workers
Dave Regan -- trustee for the Service Employees International Union-United Healthcare Workers West -- said Tuesday that Kaiser and his union have an agreement that prevents the company from laying off union members.
He said in a statement, "We are disappointed that Kaiser saw fit to send out notices to individual employees notifying them that their positions were being cut. This will unnecessarily alarm those individuals, even though we have negotiated strong options to avoid actual layoffs" (San Francisco Business Times, 8/11).
What's Next for Affected Workers?
For employees affected by the position eliminations, Kaiser will provide 52-week severance packages, extended health benefits and assistance finding new positions within the organization.
The health provider also will offer incentives to encourage certain employee groups to resign voluntarily (Avalos, Bay Area News Group/Oakland Tribune, 8/11).
Gay Westfall, Kaiser senior vice president for human resources, said, "Our hope is that the number of people who choose voluntary separation will help reduce the number of employees affected by the positions eliminations" (Goldeen, Stockton Record, 8/12).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.