Ochsner Health is eliminating 770 positions immediately in an effort to curb financial challenges, the New Orleans-based health system announced Thursday.
The positions represent about 2% of Ochsner's 36,000 staff members across its 47 hospitals and more than 370 health and urgent care centers in Louisiana and Mississippi. Thursday is the last day of work for affected employees.
Ochsner Health CEO Pete November pointed to mounting labor costs, a clinician shortage, high inflation and the end of federal COVID-19 funding as reasons for the cuts.
The layoffs mostly affect management and non-direct patient care roles. Physician roles will not be cut, and affected employees with active clinical credentials will be offered direct patient care positions, said November, who moved into Ochsner’s top role last year.
“It is the hardest change we have ever had to make at Ochsner, but one we must to ensure we continue to be a strong organization with the resources to fulfill our purpose and lead the way for clinical excellence and innovation,” November wrote in a message to staff at the nonprofit health system.
Ochsner reported a $96 million operating loss in 2022, according to the health system. Annual revenues increased 8.18% to $6.39 billion. Expenses increased 12.45% to almost $6.49 billion. Last year, 46% of its total expenses went toward salaries and wages.
A spokesperson said the cuts represent the first systemwide reduction in force for Ochsner, and no additional systemwide cuts are planned. Executives declined interview requests.
Health systems nationwide have had to reconsider where they allocate money to keep their finances and operations afloat. Many have chosen to cut non-clinical roles, especially as they continue to struggle to fill clinical positions.
Rapid City, South Dakota-based Monument Health laid off 80 staff members last week, which amounts to about 1.5% of its workforce. Most of the affected employees held corporate service roles such as billing, marketing and human resources. Last year, Renton, Washington-based Providence reduced its seven regional divisions to three, cutting some executive leadership positions in the process.
