UPMC is shedding 1,000 jobs

Pittsburgh-based health care giant UPMC said Wednesday it is cutting 1,000 jobs because of post-pandemic challenges.

The reductions will impact just over 1% of UPMC’s more than 100,000-member workforce systemwide, according to Paul Wood, vice president and chief communications officer.

“The entire health care industry continues to face the realities of a still-evolving, post-pandemic marketplace,” Wood said in a statement. “UPMC is responding to these challenges and opportunities while remaining true to its mission of providing exceptional care for patients, employees, members and communities.”

Layoffs primarily are taking place among non-clinical, administrative staff who don’t deal directly with patients. Staff cuts also will be realized through attrition, closing of open positions, elimination of redundancies and other actions, he said.

Wood said the moves will not change UPMC’s investments in communities, facilities, clinical care, research, growth or benefits.

UPMC is providing enhanced severance pay and benefits coverage for affected employees.

UPMC did not elaborate on the exact number of people who will lose their jobs, nor in what departments they work or when the layoffs would occur. Spokespeople also did not detail what percentage of the staff cuts would be realized through attrition or closing open positions.

The health care system employs more than 5,000 physicians at its 40 hospitals and 800 doctors’ offices and outpatient sites. It reported a $198 million operating loss for 2023, down from an operating income of $162 million for the previous year. Total operating revenues for 2023 were $27.7 billion, up from 25.5 billion in 2022.

In November, UPMC attributed its operating losses to rising labor costs and supply markets, increases in medical claims as more patients accessed care, pharmaceutical expenses and legal settlements.

These kinds of losses are not exclusive to UPMC. Reports indicate Independence Health System, formed by the merger of Excela and Butler health systems, saw $74.1 million of operational losses in 2023.

Allegheny Health Network saw an operating loss of $173 million in 2023, a slight improvement from its $180 million operating loss from a year earlier. Nursing shortages and persistent inflation are continuing challenges for AHN, officials said in March.

The layoffs at UPMC come as the system is in the midst of acquiring Washington Health System, about 28 miles southwest of Pittsburgh.

Washington Health System employs more than 2,000 people and provides services at its 278-bed hospital in Washington and 49-bed WHS-Greene Hospital in Waynesburg. WHS also operates more than 40 off-site locations throughout three counties and other outpatient facilities. The merger is awaiting approval from the state attorney general.

In a statement Wednesday, state Rep. Tim O’Neal, R-Washington, said he had spoken to UPMC leaders, who said their “commitment to Washington Health System will not change as a result of this announcement.”

“UPMC promises to retain all WHS staff for at least 10 years if the merger is approved,” O’Neal said. “While today’s news is upsetting, without this merger, we risk losing local access to health care. I again urge Gov. Josh Shapiro to encourage the attorney general to approve the plan.”