San Diego-based Scripps Health recently revealed it will lay off 69 employees.
The layoffs, which will take place May 20 through Oct. 4, affect employees in the human resources and marketing departments.
Scripps Health President and CEO Van Gorder, who has reinforced a no-layoff philosophy over the duration of his tenure, recently spoke with Becker's Hospital Review about the layoffs.
Question: What were the circumstances surrounding the layoffs?
Chris Van Gorder: Revenues have flattened out due to healthcare reform and payer mix changes and we are seeing an increase in government sponsored patients. Volume is up, costs are up and revenues are flat. Since we need to hit our financial targets to generate enough capital to comply with California's SB1953, which requires upgrading or replacement of our hospitals by 2030, we need to control our costs. But it's also the right thing to do for our patients. Lower costs means more affordable access for our patients.
Q: How will employees and various departments be impacted?
CVG: We are lowering our costs within corporate departments so there should be no impact on patient care. In fact, the intent is to lower costs in administrative functions to make sure we have the necessary resources for patient care.
Q: All affected employees will be offered the opportunity to use the system's Career Resource Center. What is the center and how does it work?
CVG: We have a no-layoff philosophy but with all the changes going on in healthcare we can't promise any employee that they will have the same job at the same location their entire career. So we created the Career Resource Center more than a decade ago. Experts in talent management, HR [Human Resources], EAP [Employee Assistance Program] and others assist staff whose positions are eliminated at no fault of their own to update their skills and obtain another position at Scripps. The impacted staff retain their salaries while in the CRC. In the more than 10 years we have had the CRC, more than 1,000 employees have participated, and I'm told more than 90 percent were successful in finding a new position.
Q: Is the CRC a novel idea? Do a lot of other systems have similar centers?
CVG: It's very unique. I don't know of any other.
Q: What are your goals moving forward?
CVG: Our goals are to rebase our cost structure by lowering our costs for the good of our patients and our staff. This will make sure Scripps remains financially strong so we are here for our patients when they need us while remaining a secure employer for our staff. We are also a major part of the San Diego and community economy. We provide many jobs at Scripps and even more for people who provide services to Scripps.
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