HCMC cuts 100 jobs as state funds are reduced

Minnesota's biggest safety-net hospital is cutting 100 jobs and freezing capital spending at a time when demand for its services is growing.

Hennepin County Medical Center (HCMC) blamed the moves on reductions in state funding announced last month.

The 100 jobs, which represent 3 percent of the hospital workforce, will disappear by the end of February. About 80 percent of them are vacant; the rest will come from a combination of layoffs and reduced hours.

"There's a lot of belt-tightening," HCMC Chief Executive Lynn Abrahamsen said Monday.

HCMC is one of many health care organizations that have reported cutbacks as a result of the recession. Late last year, Fairview Health Services, Park Nicollet Health Services, Allina Hospitals and Clinic and North Memorial Health Care collectively cut more than 1,000 jobs.

But HCMC is particularly vulnerable to state budget reductions. Nearly three fourths of its revenue comes from state and federal government programs such as Medical Assistance, MinnesotaCare and Medicare. Because HCMC is a "safety-net" hospital, demand for its services rises as the economy plummets.

Last month, faced with a yawning budget deficit, the state cut $73 million in funding for Health and Human Services. Of that, $12 million was dedicated to training residents and medical students and to provide care for Medical Assistance patients at HCMC.

HCMC said it will delay investments in certain support services. For example, it will reduce the number of employees who provide training on its new electronic medical-record system, and delay expansion of a clinic call center.

The call-center delay will mean some patients could be on hold longer, a scenario that is "at best, frustrating, and at worst, endangering," Abrahamsen said.

Last year, the number of patients seeking care at HCMC rose by almost 10 percent to 37,463. HCMC gave away $49.5 million in free care last year, based on discounted rates. That's up 6.4 percent from 2007.

As the recession deepens and employers shed workers, many of these workers who have lost their health benefits along with their jobs are showing up at HCMC for free care.

"If we have to do too many reductions, I'm concerned we won't be there for our patients," said Abrahamsen.