UPMC of­fers 3,500 staffers buy­outs to cut la­bor costs

Modern Healthcare - - REGIONAL NEWS - —Me­lanie Evans

In Pitts­burgh’s fiercely com­pet­i­tive health­care mar­ket, UPMC an­nounced vol­un­tary buy­outs to re­duce its la­bor costs.

The sys­tem—which in re­cent months has also cut its hos­pi­tal ca­pac­ity—of­fered 3,500 work­ers vol­un­tary buy­outs to “achieve cost­sav­ings for UPMC by ad­just­ing our work­force to meet the de­mands of the health­care mar­ket­place,” spokes­woman Glo­ria Kreps said.

UPMC is a month away from the June 30 end of its fis­cal year, dur­ing which the sys­tem has seen slow growth in pa­tient rev­enue and a drop in hos­pi­tal ad­mis­sions. The end of June will also mark six months since the breakup be­tween UPMC, which owns a health plan, and High­mark, Pitts­burgh’s largest health in­surer. High­mark owns Pitts­burgh’s com­pet­ing health sys­tem, Al­legheny Health Net­work.

UPMC of­fi­cials said early fall­out from the split was “very min­i­mal” and re­ported flat pa­tient rev­enue in the first quar­ter. Health plan rev­enue, how­ever, in­creased 16% com­pared with the same pe­riod a year ago.

Kreps said UPMC of­fi­cials do not have a sav­ings tar­get for the buy­outs. Em­ploy­ees who ac­cept the buy­out of­fer must be at least 60 years old and have worked with UPMC for 10 years or more. Those who agree to the of­fer are ex­pected to leave UPMC within three months.

The par­ent of UPMC Pres­by­te­rian in Pitts­burgh is of­fer­ing worker buy­outs.

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