Providence Health & Services Layoffs Part of Plan to Balance Budget

Job Cuts

The Providence Health & Services Company Readies Layoffs

Providence Health & Services seeks to make massive cuts in order to balance its budget, all while the impending healthcare reform bill leaves many uncertain about the future of hospitals and healthcare in the U.S.

Providence posted an annual loss of more than $255.0 million, filings show. While detailed numbers have not been disclosed, the cutbacks will include layoffs that may span the seven-state network of the hospital chain.

In the past two years, Providence added 15,000 new employees. It has a total of 111,000 currently working. In Oregon alone, the company employs 21,500 people, making it the largest private-sector employer in the state.

The stress of the budget deficit comes at a time of great uncertainty in the medical business in general, as a Republican health care replacement for the Affordable Care Act (ACA) is currently being considered in the Senate.


If the bill passes, many of the Medicaid provisions promised in the ACA will be rolled back, leaving millions uninsured and hurting hospitals further.

Providence’s 50 hospitals took in more than one million Medicaid patients in 2016, with a good portion of that unfunded by the government. This leaves the hospital on the hook for over $1.0 billion in subsidies for those treatments, which are generally focused on the poor.

In the past, however, the influx of insured patients under the ACA and expanded Medicare helped Providence and many other large hospitals experience profit surges, as millions of Americans were able to attend hospitals that had been previously scared off by the lack of insurance. Oregon added over 400,000 to the Medicaid program.

As profit surged, however, so did competition for the best staff, leading to higher payrolls and therefore slimmer margins.

With the current healthcare bill still coming through the Senate, some studies have shown that millions will lose their coverage, while the healthcare industry in general will see massive reductions in terms of profits and jobs.

The bill is being highly contested at the moment and is facing opposition from members of the GOP. As it stands, the Senate is divided, with 52 Republican Senators to the 48 Democrats, meaning that at least three Republicans need to defect in order to defeat the bill. However, some have been open in their willingness to stand against the bill.



Providence plans aggressive cost-cutting, layoffs, amid health care high anxiety,” The Oregonian, July 10, 2017.