Hospitals, a reliable source of employment growth in the recession and its aftermath, are starting to cut thousands of jobs amid falling insurance payments and inpatient visits.
The payroll cuts are surprising because the Affordable Care Act (ACA), whose implementation took a big step forward this month, is eventually expected to provide health coverage to as many as 30 million additional Americans.
Health care providers announced more layoffs than any other industry last month — 8,128 — largely because of reductions by hospitals, according to outplacement firm Challenger Gray and Christmas. So far this year, the health care sector has announced 41,085 layoffs, the third-most behind financial and industrial companies.
Total private hospital employment is still up by 36,000 in the past 12 months, but it's down by 8,000 since April, and more staff reductions are expected into next year.
This month, Indiana University Health laid off about 900 workers as part of a move to trim its budget by $1 billion over five years. Vanderbilt plans to eliminate 1,000 jobs by the end of the year to help shave operating costs 8% a year. The Cleveland Clinic is offering buyouts to 3,000 employees as it shaves its annual operating costs by $330 million. Read more >>