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UMMC announces layoffs, budget shortfall

The University of Mississippi Medical Center has announced its financial action plan to address unanticipated reductions to patient care reimbursement and other revenues currently totaling $32.7 million.

The Medical Center has identified $24 million in savings through a combination of reduced spending and enhanced revenues to be realized by June 30, the end of the fiscal year. That includes the loss of approximately 195 jobs and the elimination of vacancies totaling 85 positions, all spread proportionately across the organization. In addition, a number of faculty took pay reductions.

“Unfortunately, it was not possible to reach savings of this magnitude without reductions in staffing,” said Dr. LouAnn Woodward, vice chancellor for health affairs and dean of the School of Medicine. Her only conditions for the plan, Woodward said, were that leaders make adjustments “without negatively impacting the patient experience or academic integrity.”

All other options were available to meet the target.

“The people who lost their jobs are good, hard-working people who will be missed as team members, and we appreciate their service,” Woodward said.

The employees who are impacted represent all facets of the organization, including the health system; the academic, research and service areas; and the faculty all across the state.

“We have arranged outplacement services to assist them with job searches, benefits or transition to retirement, when applicable,” Woodward said.

Much of the savings will come from restructuring. For example, the duties associated with multiple positions performing similar tasks have been consolidated into fewer positions, Woodward said. A number of programs are being modified to run more efficiently, she said.

“We have placed additional constraints on the hiring process – not an outright freeze, but a more carefully managed review,” Woodward said. “The principal exception is for new hires viewed as crucial to patient care.”

The decisions “have been extremely difficult,” Woodward said. “But it is imperative that we align our costs with our revenues. Academic medical centers are facing many unknowns. We have to take precautions to respond proactively.”

Savings of $24 million won’t completely solve the Medical Center’s current financial problems, Woodward said. “We expect these pressures on our revenues to continue, so our emphasis on efficiency, growing revenues and finding new ways to provide the same or better services at a reduced cost will continue through fiscal year 2018.”

She stressed that the financial challenges with UMMC’s operations will have little or no effect on strategic priorities such as clinical quality improvement, health professions workforce growth, and the $180 million children’s hospital expansion, which includes a $100 million fundraising goal. “Now more than ever, community philanthropic support is critical to our efforts to meet our mission and create a healthier Mississippi,” she said.

The state’s only academic medical center is on a journey that “presents worlds of opportunity and, occasionally, difficult challenges,” she said. “We will surmount this current challenge and, together, continue our journey toward a leaner, more efficient and better organization for our staff, for our patients, and for Mississippi.”

 

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