State budget cuts lead to layoffs at Providence

Staff writerAugust 16, 2011 

The parent group of Olympia’s Providence St. Peter Hospital is set to cut 8 percent of its work force as part of an effort to close a $28 million gap in its 2011 budget, the chief executive of the medical network said this week in a memo to employees.

The budget gap is the result of cuts to Medicaid and other state-funded health care cuts, according to Providence Health & Services, Southwest Washington region.

Job cuts at the regional medical network, which includes Providence Centralia Hospital and Providence Medical Group, amount to 250 full-time-equivalent positions.

About 115 people have volunteered for a severance program and a number of open positions will not be filled, which could reduce the impact of layoffs, Chief Executive Medrice Coluccio said. The number of positions that won’t be filled still needs to be determined, spokeswoman Deborah Shawver said. Layoff notifications will begin Aug. 22.

“These are the most heart-wrenching decisions, as they affect individuals who are dedicated to our mission and have made valuable contributions to our ministries,” Coluccio said.

Affected employees include managers and staffers; the management restructuring began in fall 2009 when some senior executive positions were cut.

Other leadership roles have been consolidated, Coluccio said.

The organization plans other ways it can close the budget gap. Examples include boosting revenue, further reviewing its programs and services and cutting costs by possibly changing certain medical products or renegotiating contracts with vendors.

Providence Health & Services, Southwest Washington, employs 3,539 people; Providence St. Peter Hospital employs 2,366.

The organization announced the voluntary separation package in a letter to employees last month. They had until Aug. 8 to accept the package, which includes a lump-sum bonus based on length of employment.

Capital Medical Center, too, is responding to state budget cuts, Chief Executive Jim Geist said this month. A hiring freeze is in effect for some departments, and hours have been reduced for some positions. The hospital also has cut back on some elective orientation and education programs, he said.

The hospital hasn’t had to cut jobs, Geist said. It employs about 475 people.

Rolf Boone: 360-754-5403

rboone@theolympian.com

www.theolympian.com/bizblog

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