Children's Minnesota considering 'significant' layoffs, consolidation of services

Citing mounting financial pressure from the pandemic, demographic shifts and policy changes, Minneapolis-based Children's Minnesota is eyeing "significant" layoffs and service consolidations, according to the Star Tribune. 

Children's Minnesota said it is considering moving some pediatric services from its inpatient hospital in St. Paul, Minn., to its Minneapolis campus. Some of the services that may be consolidated into one location include pediatric intensive care services, neurology services and diabetes care.

Children's Minnesota CEO Marc Gorelick, MD, said the consolidation is one strategy in a plan that also includes investing more into virtual care, better procurement of supplies and improved financial services. 

"When we talked [at an employee meeting] about the need for layoffs and we indicated that they would be significant. That's across all the changes that we are contemplating across all of these work streams — and those are all works in progress," Dr. Gorelick told the Star Tribune."We’ve had such a long period of stability and growth, the idea that that's going to look different — we knew that that's going to be news for people."

Although the specific number of layoffs has yet to be determined, the Minnesota Nurses Association says the consolidation alone could result in more than 100 jobs lost.  

Dr. Gorelick told the Star Tribune that the changes are not only a result of the financial pressures from COVID-19, but also a need to respond to longer-term trends such as declining birthrates and reimbursement changes as value-based care becomes more prevalent. 

The children's healthcare provider saw a $10 million operating loss during the first half of 2020, due mainly to a revenue dip of $96.8 million attributed to the pandemic, according to the report.

Read the full report here.

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