HealthPartners is shutting down a home care service based in St. Paul and eliminating about 70 jobs, the third example in six weeks of cutbacks by the Bloomington-based health insurer and care system.
Officials said the upcoming closure of Integrated Home Care, which HealthPartners confirmed Thursday to the Star Tribune, stems from financial challenges at the home care service, including an expected cut next year in federal reimbursements.
The move was blasted by the union representing many home care workers, which called the shutdown “an example of a health system putting their profit margin before people.” A HealthPartners spokeswoman said the health system must “care for and serve people in a financially sustainable way.”
“We don’t anticipate further layoffs this year,” said Rebecca Johnson, the HealthPartners spokeswoman, via e-mail. “We’re committed to delivering high quality health care that is affordable for the people we serve.”
HealthPartners is one of the state’s largest nonprofit groups with about $7 billion in revenue last year and 26,000 employees. It operates Regions Hospital in St. Paul, Methodist Hospital in St. Louis Park and dozens of clinics under the names HealthPartners and Park Nicollet.
In November, HealthPartners said it would eliminate 300 jobs while closing 30 retail pharmacies and its mail-order pharmacy due to competition from large pharmacy operators. Also last month, the health system said it would eliminate about 75 jobs in a number of areas including information services technology due to diminished revenue from Medicare health plans.
Integrated Home Care provides skilled nurses as well as physical, occupational and speech therapists to patients in their home. The service often works with patients discharged from Regions. It has operated for more than 30 years and provides about 32,000 home visits and related services each year in the Twin Cities and western Wisconsin.
“As we put together our 2020 budget, we had to make adjustments to ensure that our organization would able to care for and serve people in a financially sustainable way,” Johnson said in the e-mail. “We reduced other expenses, found efficiencies and left open positions unfulfilled to avoid layoffs.”
A majority of workers in the pharmacy division as well as at the home care business are represented by the Service Employees International Union (SEIU), said Josh Keller, a spokesman for the group.
“This is the opposite of the behavior we expect from an organization that claims to be committed to promoting health,” said Phillip Cryan, executive vice president of SEIU Healthcare Minnesota, in a statement. “The SEIU members at HealthPartners have been very proud of the work they’ve done caring for families in our community and of the organization they worked for, for many years.”
HealthPartners has been selling health insurance and running clinics in Minnesota for more than 50 years. Through the first three quarters of 2019, total revenue at HealthPartners is down less than 1% compared with the year-ago period primarily due to a decline in health insurance membership, according to a November financial statement.
Year-to-date premium revenue at HealthPartners is down $203 million, or 7%, to $2.56 billion. At the same time, patient care revenue through the end of September is up about 5%, or $112 million, to $2.38 billion.
While investment income through the first three quarters has more than doubled, overall net income at HealthPartners is down about $49 million, or 31%, to about $129 million.