This story has been updated with additional reporting.
Providence is cutting 134 jobs in Oregon and more than 450 across six other states, the not-for-profit health care system disclosed Thursday afternoon. It cited expected cuts in federal support for Medicare and Medicaid, higher costs for labor and supplies, and “denials and delayed payments from commercial insurers.”
In Oregon, Providence management this week told 134 employees, including some union workers, that their jobs were being eliminated, a spokesperson said in an email. The system will help some find other jobs within the system, though the system has identified dozens of open jobs in the state that will not be filled. In Washington, 250 jobs were eliminated.
The cuts are just the "first round,” Providence Oregon's chief executive, Jennifer Burrows, told The Lund Report. “We're going to see more changes occur throughout the year, and, and so, but we're working with our teams to find them, you know, available positions if they want to stay with the organization.”
Systemwide, Providence employs 125,000 people, including 23,800 in Oregon.
Providence did not identify which jobs and services it would cut, but a prepared statement said the cuts fall mostly on “non-clinical, administrative functions, though some patient-care roles are also impacted.” Providence Oregon also said it was cutting spending on travel, sponsorships and internal celebrations. Providence calls the cuts part of a systemwide restructuring.
The news comes as health care providers in Oregon and around the country are bracing for shocks to the health care system driven by proposed cuts and changes to Medicaid and commercial health insurance now being considered by the U.S. Senate.
“We have seen year over year losses, which was already unsustainable, and we've been working hard to get that turned around,” Burrows said. “With more federal cuts looming, it puts us on a faster timeline to need to resolve this discrepancy that we're seeing between cost of care and and what we're seeing in reimbursements.”
Providence operates 51 hospitals and 1,014 clinics in Oregon, Washington, Alaska, California, and, through affiliates, in New Mexico and Texas. In Oregon it uses the Providence name, while facilities in other states operate as Providence, Swedish, Kadlec or Covenant Health.
In Oregon, Providence has medical centers or hospitals in Portland, Milwaukie, Medford, Hood River, Newberg, Seaside and Oregon City. It also operates the Providence Medical Group, its network of clinics and employed physicians, and the Providence Health Plan, its health insurance arm.
Providence officials do not rule out making further cuts, with its Oregon spokesperson noting the “challenging work” of reducing expenses will continue in Oregon through the year.
In its announcement, Providence Oregon laid part blame with the Oregon Legislature, which has “limited our options to achieve financial sustainability,” according to the system. System officials claim Oregon’s hospital nurse-staffing law has forced Providence to incur some of the highest staffing levels and labor costs in the country. Alluding to other Oregon laws, the statement said lawmakers have made it harder to form “innovative” partnerships and required that Providence provide extensive free and discounted care.
In February, Providence nurses ended a six-week strike against Providence Oregon with a new contract that included wage increases of from 22% to 42%, plus back pay, union officials said.
