The Health Center recently announced that it will eliminate as many as 160 positions before the end of the year, as part of a comprehensive effort to correct pressing financial shortfalls. Cuts will be announced in stages, and began last week. Every effort will be made to keep job loss at a minimum through attrition and by not filling open positions.

"This is certainly a very difficult decision in the midst of very difficult times for the Health Center - and for hospitals and academic medical centers across the country," said Peter J. Deckers, dean of the School of Medicine.

The Health Center currently employs about 4,000 people. The job reductions will affect all levels within the institution, including management. The Health Center includes the John Dempsey Hospital and its outpatient practice, the University Medical Group, as well as the School of Medicine, the School of Dental Medicine, and central administration.

"Patient care will not be diminished by these changes," Deckers said, noting that when necessary, the Health Center will continue to hire staff in critical, patient-care areas.

The workforce reduction announced October 22 is expected to save approximately $8 million annually, and does not reflect staff reductions within the faculty. Those reductions are expected to begin early next year.

The Health Center ended its fiscal year on June 30 with a $14 million shortfall, and anticipates a $16 million deficit this year. Losses stem largely from the John Dempsey Hospital, which has been reeling from reduced reimbursements by HMOs and from drastic reductions in Medicare reimbursements due to the Balanced Budget Act of 1997.

"We are now in the midst of an aggressive, ongoing effort to eliminate the deficit through revenue enhancements and cost savings," Deckers said. "This is a rigorous and comprehensive process of strengthening the organization so we can make sure the Health Center can continue its core mission of excellence in medical education, research and patient care."

Deckers said that, with about 70 percent of the Health Center's overall expenses directly tied to employee costs, substantial reductions in the workforce are an "unfortunate necessity." He also noted that the Health Center has instituted a hiring freeze and limits on capital purchases.

Historically, academic medical centers have relied on revenues generated by their hospitals and clinics to offset the cost of maintaining education and research programs, as tuition only covers a fraction of the costs of medical and dental education.

"When one part of our institution suffers, we all feel the pain," Deckers said. "This is not a question of seeing fewer patients. Rather, it's a matter of receiving fewer dollars every time we provide care. And when our clinical services are placed in financial jeopardy, our schools are threatened as well."

None of the reductions announced will affect self-supporting, grant-funded research positions, he said.

Employees have been notified of the workforce reduction.