Tufts Medicine to cut hundreds of jobs as it outsources lab services
Hundreds of employees at Tufts Medicine will be let go as part of the sale of its laboratory business, according to state disclosures released on Friday, however the health system said many of those affected will be offered other jobs.
The health system, which has faced prolonged financial difficulties, on Aug. 3 announced the sale of its Tufts Medicine Outreach Laboratory business and some operating assets to Labcorp of North Carolina.
According to Rebecca Deusser, a spokeswoman for Tufts Medicine, the deal is the first step of an envisioned larger strategic partnership to expand patient specimen collection across its network.
As a result, the health system told state officials that all of its lab employees could be affected, including 242 at Tufts Medical Center, 251 at Lowell General Hospital, and 81 at Melrose-Wakefield Hospital.
“Our intention is to have the majority of laboratory employees receive comparable job offers,” Deusser said.
Duesser said that those who will be offered jobs at Labcorp will continue working for Tufts until they transition. A spokesperson for Labcorp wasn’t immediately available for comment Friday evening.
The deal comes amid an urgent need for Tufts Medicine to improve its operations to avoid defaulting on an $800.8 million agreement with bondholders. If the system fails to meet required metrics by the end of September, bondholders could bring in a third party to restructure the health system, analysts say.
Executives had hinted at working toward such a deal, saying they were exploring potential partnerships, selling assets, or outsourcing what CEO Michael Dandorph said were “noncore” aspects of Tufts’s operations, to reduce the system’s expenses and bring in more revenue.
The health system had also pressed the state for funding, advocacy that may have proven successful. Legislators recently approved $180 million to go to struggling hospitals, though the state hasn’t detailed specific allotments for health systems.
Executives have been working diligently to turn around operations in other ways before the September deadline. In January, the system announced it would lay off 70 people and eliminate another 170 vacant positions. The system has also put a partial hiring freeze on new administrative roles, and is looking to consolidate other administrative work.
An outside consultant, hired by Tufts as part of bond requirements, has helped the system strengthen operations, including taking advantage of its new medical record system to improve its billing processes.
The system has also worked to find new ways to increase revenue, opening 12 new medical/ surgical beds at Tufts Medical Center in Boston and two new outpatient surgery centers in Medford and Chelmsford in partnership with its physicians.