At Detroit Medical Center, the six-hospital for-profit health system's goal of laying off nearly 330 employees has nearly been accomplished this year. When layoffs the previous three years are added, DMC has about 1,000 fewer employees than in 2015, or under 11,000.
The stated goal for the layoffs and reorganization this year by CEO Tony Tedeschi in his last memo to employees on March 19 has been to prepare for a future where patients and insurers rely less on inpatient services and more on outpatient care. DMC staffing levels also are moving toward industry standards, officials said.
"As new patient admissions flatten overall, hospitals are caring for more government-subsidized patients at a time when government reimbursements are declining," Tedeschi told DMC employees. "What's more, patients are becoming more like consumers in other industries as they seek more convenience and value in care. As a result, hospitals are investing to embed more outpatient services deeper into communities, closer to the people they serve."
Tedeschi said DMC is cutting costs by an unspecified amount to "invest in care." It is not clear how he is doing that, however, based on layoffs the past few months of unit nursing clerks, nurse practitioners and physician assistants, dietary and food service workers, pharmacy personnel, maintenance and security employees and social service workers.
But DMC also has laid off a number of managers and is reorganizing its pharmacy department, human resources and nursing administration.
"In just eight weeks, we have freed up resources for care by reducing administrative costs significantly," Tedeschi said. "We have removed management layers between leadership and front-line care providers to nurture more impactful communication."
Tedeschi has not announced hirings in clinical care areas and several key sources told Crain's that they know of none planned. He has not specified the percentage of laid-off management employees compared with front-line and clinical workers.
"We have eliminated redundant or unnecessary administrative work to make decision-making faster and care delivery simpler," Tedeschi said. "We have expanded the responsibilities of managers and moved people and resources from the group level into our hospitals, which best understand the needs of their patients and local communities."
In his last memo, Tedeschi announced that longtime DMC employee Tonita Cheatham has been promoted to DMC director of communications and will serve as group lead to support all hospitals. Melanie Moss, former DMC media relations manager, has left to become first lady of her church, Living Waters in Detroit, Cheatham said.
To increase transparency with employees, Tedeschi also promised to communicate DMC's plans for change more often with employees, presumably in his Monday "special message" to employees.
Tedeschi declined to comment to Crain's for this story.
John Truscott, an external DMC spokesman with Truscott Rossman in Lansing said most of the layoffs have already taken place and there are a few more coming to achieve the health system's goal to reduce 3 percent, or 330, of 11,000 employees.
In an email to Crain's Friday, Truscott said the layoffs and reorganization of some departments is to bring DMC in line with industry staffing and management standards. However, Truscott did not specify the number of people laid off in various service areas or departments.
Nearly half a dozen sources at DMC, who asked for anonymity, have told Crain's that employees laid off so far include managers, vice presidents, nursing unit clerks, maintenance engineers, pharmacists and pharmacy technicians, and employees in human resources, nursing, dietary and food service, social services and security areas.
In a March 19 email to employees, Scott Steiner, CEO of DMC's Detroit Receiving and Harper-Hutzel hospitals, said a search is underway to find a new chief nursing officer to replace Christine Bowen, who left earlier. DMC just hired Sandra Emeott to serve as interim CNO. DMC Group CNO Shawn Levitt had been subbing the past few months.
Truscott confirmed the CNO at Huron Valley Sinai Hospital in Commerce Township has left, but he said there is an interim CNO in place while DMC seeks to recruit a permanent one. Huron Valley nurses have been negotiating a union contract the past 16 months.
Two sources said Monica Butler, M.D., COO of Children's Hospital of Michigan, resigned last week. DMC did not comment on Butler's departure or any other specific management changes.
But three sources tell Crain's that about a dozen pharmacists and pharmacy technicians have been laid off or resigned. DMC is moving to reduce costs and has been planning to move toward a more community-based pharmacy department, sources said. Crain's previously reported that DMC has considered offers from Walgreens and CVS.
Truscott disputed there have been any widespread pharmacy layoffs. He said one pharmacist technician retired. "There have been a few staffing changes, but it has mainly been to align ourselves with industry accepted productivity standards," he said.
Sources told Crain's that three pharmacists and technicians, including those in mail-order pharmacy and the transitions of care pharmacist at Detroit Receiving have left. Others laid off include an SICU pharmacist, nephrology/transplant pharmacist and neurology pharmacist at Harper University Hospital; and at least one pharmacist at Children's Hospital.
A pharmacist, clinical coordinator emergency pharmacy specialist and nursing manager have left DMC Huron Valley Sinai Hospital, two union nurses at Huron Valley said.
DMC also have reduced hours of pharmacists in the ER and OR and social workers with the exception of Children's Hospital, sources said.
Sources also tell Crain's the "stat lab" at Harper will no longer process urine analysis and samples will be sent to the core lab, which will take longer to process, slowing up ER care. In addition, the director of respiratory therapy for DMC and a respiratory care manager at Detroit Receiving were let go.
DMC also have reduced hours of pharmacists in the ER and OR and social workers with the exception of Children's Hospital, sources said.
Last year, social workers were laid off who served the pediatric intensive care unit. Several more have been laid off systemwide and their hours cut, further reducing the availability at Detroit Receiving Hospital and Children's Hospital of Michigan, sources said.
At Huron Valley, the human resource department was transferred to DMC downtown, two union nurses told Crain's.
Truscott said all changes in departments has to do with improving efficiencies at DMC and bringing the hospital into industry standards for staffing.
"Recruiting (human resource) function in all the hospitals is being aligned with corporate so we can collaborate better with our broader Tenet organization," Truscott said. "We still have recruiting staff located in Detroit and the hospitals still have an HR department."
Truscott said at some hospitals the HR staff is paid through the corporate budget rather than the local hospital budget. "This is happening in several departments, where corporate is covering the costs, but employees are still local," he said.
"DMC close to completing layoffs" originally appeared in Crain's Detroit Business.
