University of Texas MD Anderson Cancer Center will eliminate roughly 1,000 employees, or about 5 percent of its 20,000-person workforce, the system has announced.
Between 800 and 900 jobs will be cut, and the remaining 100-200 expected job cuts will happen through attrition and retirement, according to the Houston Business Journal. All of the jobs affected are in Houston.
The layoffs, which do not include physicians, will begin this week, according to Ron DePinho, president of The University of Texas MD Anderson Cancer Center.
“The reality is healthcare has changed, and so must we,” DePinho said during a news conference Thursday.
They, as other healthcare institutions, are working to improve patient care while reducing the cost for care delivery, motivated by escalating healthcare costs, reductions in reimbursement of care, and expanding healthcare needs due to an aging population.
DePinho said he and colleagues worked to avoid the layoffs by making changes and improvements, but more was needed to align expenses to revenues.
They launched an electronic health record system in March.
“…Careful monitoring indicates we must further optimize the system to realize productivity gains,” DePinho said. “We are seeing a recovery trend, but more time is needed.”
MD Anderson’s long-term financial health is strong through innovations of novel care delivery models, adopting technologies and diversifying revenue streams, he said.
The cuts are expected to save the institution around $120 million a year, or $10 million a month, according to the Houston Business Journal.
Of the total 1,000 jobs being eliminated, roughly 120 employees are in managerial, leadership or VP roles, officials said, according to the published report. No clinical faculty will be affected by the cuts.
“Despite great effort from our entire MD Anderson community, it has become clear that we must act now to protect our ability to continue investing in our mission to end cancer,” DePinho said. “While this is an action none of us wants to take, today I have accepted a recommendation from our Shared Governance Committee and I am announcing that MD Anderson will implement a less than 5 percent reduction in our roughly 20,000-person workforce – beginning this week.