UC DAVIS: Layoffs a ‘Course Correction’ for Financial Health
The University of California at Davis Health System announced Thursday it intends to eliminate 100 positions in "a course correction needed to assure the institution's continued financial health," the Sacramento Bee reports. Although currently the system is financially healthy -- it reported a surplus of $29.2 million last year -- the move is seen as a precautionary measure against shrinking reimbursements from Medicare and private insurers. Not-for-profit UC Davis health system employs about 9,000 people statewide and expects to cut roughly $12 million in staffing costs by the end of the fiscal year. For the current fiscal year, the system allocated almost $295 million for employee salaries and benefits. System director and COO Martha Marsh said, "The good news is that we're in a strong financial position to do this deliberately, rather than just wrenching a whole lot of employees out of the system." In a letter announcing the 30 layoffs and the elimination of 70 currently vacant positions, top officials said, "Regrettably, additional layoffs will be necessary. While it's likely that many reductions can occur through attrition ... we expect to have a significant number of layoffs." UC Davis has set aside $150,000 to retrain laid-off workers for other medical positions and will contact Sacramento County and other regional employers for potential job leads (Fisher, 10/22).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.