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 cost-savings 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.