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Tuesday, September 16, 2014 - 10:42am

University Medical Center eliminates 56 jobs

KTSM
News

POSTED: Saturday, July 26, 2014 - 11:43am

UPDATED: Monday, July 28, 2014 - 2:21pm

UMC: "Budgetary pressures...as a result of investments in El Paso Children's Hospital that have yet to be repaid."

UPDATE:

Fifty six people are now without a job at University Medical Center.

UMC officials said the layoffs are the result of "mounting budgetary pressure" caused by the children’s hospital - next door.

The UMC CEO, James Valenti, said this is the worst day he has had while in charge of the medical center.

"If there were any other options to avoid this, I would have done it," said Valenti.

The 56 laid-off workers affect 25 departments including food services, administration, public affairs, engineering and staff services.

"The associates I have been proud to work with, because everything I have asked them to do, they have done and more," he said.

The main reason Valenti said they were forced to let the employees go was because of the investments it has made in El Paso Children's Hospital, which have yet to be repaid.

"Because children's can't pay, we are subsidizing the children's hospital."

Officials learned earlier this year that the children's hospital would not be able to repay them in 2014 or 2015.

The layoffs are expected to save UMC more than $2 million.

“I just think that is horrible,” said Veronica Murray, whose brother is being treated at the hospital. “Especially because some of these people have been here for over 20 years, so I really feel bad for them; I’m really sad for that."

“They are losing their jobs. The economy is really tough. Everyone needs a job, and to find a job at this time, it's not too easy," said Daniel Hernandez, who’s sister-in-law just had a baby at UMC.

Officials added they have not started a hiring freeze.

They expect to continue to hire doctors and nurses as needed.

"There is a lot of hope on this campus," said Valenti.

County Commissioners will be taking on UMC's budget head on when they start hearings.

County Judge Veronica Escobar in a statement said the court will be meeting with hospital officials to discuss the 2015 budget.

Valenit also said they tried a number of options, like cutting overtime, eliminating open positions, and reducing overhead, but in the end it wasn't enough.

"We have made a significant investment in children’s, and they have not been able to pay" he said.

The children's hospital declined to comment on the issue, instead they released a statement saying:

“It is the policy of El Paso Children's Hospital not to comment about the internal decision-making of other organizations."

ORIGINAL:

Fifty-six employees of University Medical Center lost their jobs today as a result of what the hospital calls "mounting budgetary pressures."

UMC officials announced the move Friday morning saying the employees will get severance pay and will receive payment for accumulated vacation time, all according to hospital policy. They added that  the areas impacted included support and ancillary staff, as well as management.

UMC President and CEO James Valenti released the following statement regarding the layoffs:

"It is with a very heavy heart that I must tell you that UMC had to reduce the size of our workforce today," said UMC President & CEO James Valenti in a message to staff. "This is the first time in my 10 years with the Hospital District that we have been forced to eliminate positions. Please know that this action is in no way a reflection of your work. Each of you has contributed so much to our incredible transformation during the last decade. Our patient volumes are at record highs as are our patient satisfaction scores. Our quality measures have exceeded our goals. Our payer mix and market share are both up and UMC's cash collections have never been higher. You accomplished all of that and I am so appreciative of your efforts, which is why this decision was so very difficult."

The statement went on to say that "the hospital's positive momentum has not been enough to overcome the budgetary pressures it faces as a result of the investments it has made in El Paso Children's Hospital that have yet to be repaid."

UMC officials added that they have not implemented a hiring freeze, and they expect to "continue to hire clinical staff to keep pace with its growing patient volumes and clinical service lines" both this year and next.

In addition to the layoffs, UMC officials say they also implemented several cost cutting measures earlier this year in order to conserve their cash-on-hand.

UMC's statement to the media also states that the Medical Center stopped "all but emergency capital acquisitions, reduced overtime, eliminated open positions and reduced many other overhead and supply expenses." In the end, officials say that  those measures "were not enough to eliminate the need for additional action."

The news release goes on to state: "Other cost cutting initiatives have been identified and will be presented to the UMC Board during final budget preparations later this month. UMC's Board and administrative team continue in earnest negotiations with their counterparts at El Paso Children's Hospital regarding repayment terms."

Below is UMC CEO's letter to employees:

July 25, 2014

Dear Associates,

It is with deep regret that I must inform you that University Medical Center today was forced to reduce the size of its workforce because of mounting budgetary pressures. Fifty-six Associates were laid off today. They will receive severance pay and payment of accumulated vacation time based on hospital policy. Please know that the hospital has not implemented a hiring freeze. UMC’s focus is and will continue to be on the delivery of high quality patient care. This year and next, the Medical Center will continue to hire clinical staff to keep pace with our growing patient volumes and clinical services lines.

This is the first time in my 10 years with the Hospital District that we have been forced to eliminate positions. Please know that this action is in no way a reflection of our Associates’ work. Each of you has contributed so much to our incredible transformation during the last decade. Our patient volumes are at record highs as are our patient satisfaction scores. Our quality measures have exceeded our goals. Our payer mix and market share are both up and UMC’s cash collections have never been higher. You accomplished all of that and I am so appreciative of your efforts, which is why this decision was so very difficult.

UMC is experiencing budgetary pressures because of issues beyond your control, primarily the significant investments we have made in El Paso Children’s Hospital that have yet to be repaid. That’s why we began implementing cash conserving measures early this year. As you have no doubt noted, we have halted all but emergency capital acquisitions, reduced overtime, eliminated open positions and reduced many other overhead and supply expenses. Those measures have not been enough, though, to eliminate the need for additional action. The areas impacted by today’s reduction in force include support and ancillary staff as well as management positions.

The loss of our co-workers is very difficult, but each of us must remember why we are here. The people who rely on UMC for high quality healthcare still need us. They are not the cause of our budget issues. I ask you to please remember that as you interact with your patients. They are the reason we get out of bed each morning and they continue to deserve our all.

Lastly, I want you to know that UMC’s Board and management team are working around-the-clock to identify solutions to the monetary difficulties we face. Our negotiations with our counterparts at El Paso Children’s Hospital continue in earnest.

Sincerely,

James N. Valenti
President & CEO

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