Fairview Health Services is eliminating 240 jobs throughout its system as it experiences low patient volumes and significant operating losses.
Ryan Davenport, a spokesman for the Minneapolis-based health system, said in a Thursday phone interview that 70 of the job cuts will involve layoffs, while the remaining 170 positions will simply go unfilled after employees retire or leave for other reasons.
The cuts represent about 1 percent of the system's 21,000-employee work force. Affected employees will be notified between now and June, and the layoffs will be staggered throughout the next couple of months, Davenport said. The company will reach out to affected employees about career counseling opportunities.
The cuts don't target a specific division or job type. Davenport said that employees will be affected at the health system's corporate level as well as each of its hospitals-which include Fairview Lakes Medical Center, Fairview Maple Grove Medical Center, Fairview Northland Medical Center, Fairview Red Wing Medical Center, Fairview Ridges Hospital, the University of Minnesota's Medical Center and Amplatz Children's Hospital, and the Fairview University Medical Center-Mesabi. Fairview also has a 25-percent ownership stake in Maple Grove Hospital, but Davenport said that there aren't currently plans for cuts at that location.
Davenport said that the job reduction is the result of several factors. "We've been facing lower than expected patient volumes, and compared to quarter one of 2010, our operating performance is behind what we've planned for." He said that the company also is anticipating significant cuts to its funding. Fairview reported an operating loss of $3.44 million for the first quarter of this year. During the same period a year ago, the system reported operating income of $28.96 million. Inpatient hospital admissions fell 4.7 percent in the first quarter from last year.
In addition to lowering headcount, Fairview is reducing some discretionary spending, duplication of efforts, and supply costs, among other cost-saving measures. "We need to continue to focus on growing our volumes and improving operating performance," Davenport said. "We certainly don't take lightly the act" of reducing Fairview's work force.
Other local hospitals cut jobs last year. North Memorial Medical Center eliminated 200 positions, and Children's Hospitals and Clinics of Minnesota cut between 200 and 250 jobs.