Staff cuts at Memorial Medical Center to affect about 165 employees

kcarlson@modbee.comNovember 15, 2012 

— Staff cuts at Memorial Medical Center will affect 165 employees as the Modesto hospital scales down its work force to deal with economic realities in the health care sector, hospital officials said Thursday.

According to a statement released by hospital officials, about 40 employees at the 423-bed facility will lose their jobs.

About 125 other employees will have their work hours cut, or their positions will be eliminated and they will be offered other jobs.

Some of those employees will be offered positions that do not include benefits, Memorial's official statement said.

The staff reductions, to take effect Jan. 15, are across more than 25 clinical and nonclinical departments at the medical center, located at Briggsmore Avenue and Coffee Road. About 5 percent of the center's 2,900 employees are affected.

Daryn Kumar, chief executive officer at Memorial, said the cuts announced Thursday are entirely related to a decrease in patients this year and an associated decline in payments from insurers. Memorial's patient census has dropped 8 percent this year, he said.

"It's about (restructuring) our staff so we have the right amount of staffing for the patients we have," Kumar said. "Our economy is catching up with us. Health care is not immune to our economy."

Kumar said that most other hospitals in Stanislaus, San Joaquin and Merced counties have seen an 8 percent to 12 percent decrease in patient census in the last two years.

Experts have said that job losses during the recession caused many people to lose their insurance and fall back on government health programs; in addition, a trend toward insurance plans with higher deductibles results in people delaying elective surgeries.

It appears that additional job cuts are coming at Memorial, a hospital affiliated with Sutter Health of Sacramento.

Kumar said Thursday's announcement was not related in any way to Sutter's plans to consolidate billing, human resource, purchasing and other business functions at a new administrative services center in Roseville, which is set to open next year. Currently, those services are spread over dozens of Sutter facilities from the Central Valley to the Bay Area.

Kumar said he could not estimate how many local positions would be lost as a result of streamlining administrative services in Sutter's health system. "We are working through the process now," he said.

In the past several months, Memorial has taken other steps to cut expenses, such as reducing supply costs and temporarily closing some units. Kumar said the hospital has left some management and administrative positions vacant because of the budget problems.

He assured the restructuring won't have a negative impact on patient care; the hospital is simply scaling down clinical staff to care for a smaller number of patients.

Today, the hospital's management plans to hold meetings with employees in different departments to discuss more details of the restructuring. Some employees told The Bee they were afraid to talk about the job cuts. As a general policy, the nonunion hospital tells its employees not to speak with the media.

One employee said Thursday that some of her co-workers were told their hours would be cut to less than 30 per week. It will not only reduce their pay but result in higher deductions from their paychecks for health benefits, she said.

"Everybody has been on pins and needles," the employee said. "We are all stressed, and morale has been at an extreme low."

In its statement, Memorial said that affected employees were receiving information about severance packages and extended health coverage. They also will receive information about resource fairs, recruitment services and other resources to help with job searches.

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

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