MEDPARTNERS: Cuts Staff, Southern California Physician Pay
Birmingham, AL-based MedPartners Inc., "attribut[ing] much of its financial woes to its difficulties controlling costs in Southern California after several large acquisitions," has announced layoffs in order to "return to profitability." The Los Angeles Times reports that "the nation's largest manager of physician groups" announced yesterday that it plans to "fire 1,045 employees, including 45 doctors." In addition, 950 MedPartners doctors in Southern California have agreed to a "temporary 7% pay cut." In October, MedPartners fired 600 Southern California workers, "including 120 doctors." The company employs 9,500 workers in Southern California, serving 1.3 million health plan subscribers "through the Mullikin, Friendly Hills, Talbert and other medical groups." MedPartners suffered "a startling $840-million fourth-quarter loss in March" and last week reported a $25.7 million first-quarter 1998 loss while facing a potential buyout. A MedPartners spokesperson said that "patients whose physicians are fired will be 'transitioned' to other doctors" (Olmos, 5/15).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.