Cuts looming at Memorial Medical Center of Modesto

MODESTO -- Employees at Memorial Medical Center of Modesto are bracing for staff cuts or the possibility their jobs are being relocated to the Sacramento area.

For months, the hospital's parent organization, Sutter Health of Sacramento, has been working to streamline operations such as finance, billing, human resources and purchasing at its medical centers in Northern California, a move expected to result in staff reductions.

But the cost-cutting could go deeper. Employees in some patient-care areas at Memorial said managers have told them to expect staff cuts as early as next month.

"There have already been patient-care-related jobs cut and there are more coming," said a Memorial employee, who did not want to be identified, for fear of being fired. "That has been told to us several times by our managers and administration. ... They are cutting throughout the entire hospital."

The employee said the cuts are related to tighter budgets in hospital departments. Hospital employees said they are expecting from 150 to 200 job losses. A Sutter spokesman said he had no information about potential job cuts at Memorial.

An undetermined number of Memorial employees will be affected when Sutter Health opens an administrative services center in Roseville early next year. The center will function as a central service hub for finance, billing, human resources and other nonpatient services. Currently, those services are spread over dozens of locations stretching from the Central Valley to the Bay Area.

In an announcement Wednesday, Sutter said a first group of 200 to 300 employees will move into the Roseville facility in the first quarter of 2013 and more will follow. Sutter said the center is expected to employ more than 1,000 administrative support staff over the next 18 months.

Bill Gleason, a Sutter Health spokesman, said it's not known yet how many positions will be eliminated at Memorial or other facilities in the Central Valley region as operations are moved to Roseville. But affected workers should be informed in the coming weeks. The consolidation will result in a reduction of Sutter's overall work force in Northern California, he said.

"There will be fewer employees providing these services," Gleason said. "We informed employees (Wednesday) that we will begin the process of notifying them in November about impacts on specific individuals."

He said current employees will be given preference for positions in Roseville, but Sutter expects that some employees might not choose to relocate.

Sutter will try to find jobs within its nonprofit health system for employees whose jobs are eliminated by the consolidation, Gleason said. In recent months, "we have filled a number of available positions with temporary help to preserve as many jobs as we could for affected employees," he said.

Employees who are unable to find suitable positions in the Sutter network will be eligible for severance pay, he added.

More efficiency sought

According to Sutter, the streamlining process was designed to help Sutter operate more efficiently, lower overall costs and ensure the cost reductions are passed on to patients who use Sutter doctors and hospitals.

Gleason said decisions about patient-care staffing are made at the local hospitals affiliated with Sutter. "Regarding the rumors about layoffs at Memorial Medical Center, I can tell you that there has been no announcement about any layoffs," hospital spokesman Craig Baize said in an e-mail.

A representative for the California Nurses Association, Marti Smith, said that nurses at Memorial were told in July that staffing numbers could decrease. "We are hearing mixed reports from across Sutter facilities, with some managers telling nurses there could be layoffs," said Smith, noting the union is doing organizing work at Memorial. She said she doubted Sutter could cut nursing staff because of the patient-care workload.

While some Memorial employees said they were told hospital revenue was down, Smith said Memorial is profitable, according to financial data reported to the state.

Jeff Rowe, director of Alliance Worknet in Stanislaus County, said he would encourage affected office workers to follow their jobs to the Sacramento area if they are offered positions.

"The job market still is very tough here," Rowe said. "We are talking about back-office medical office work and medical billing. We have had some layoffs in that area in the last few years and it will be difficult to find a job (locally) that is similar to what they have."

Health care was considered a rare bright spot in the job market when the economy went into recession in late 2007, but there has been a definite slowdown in the availability of health care jobs, Rowe said.

He said the Alliance Worknet had not been notified of potential job cuts at Memorial. The agency offers retraining services and other help to people who lose their jobs.

The Sacramento Bee contributed to this report.

Bee staff writer Ken Carlson can be reached at kcarlson@modbee.com or (209) 578-2321.