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URMC to furlough nearly 3,500 staff as COVID-19 depresses revenues

May 8, 2020

The University of Rochester Medical Center will begin placing 3,473 employees -- just shy of 20% of its staff -- on furlough next week, the hospital system said in a statement on Friday.

Strong Memorial Hospital at the University of Rochester Medical Center will place more than 1,500 employees on furlough starting Sunday, the medical center said.
Credit urmc.rochester.edu

Nearly 700 of those staff will be out of work entirely with no guarantee of returning to their jobs when furloughs end, URMC said. The remaining 80% of furloughed employees will work reduced schedules.

The staff reductions are necessary to offset an estimated $315 million budget shortfall, said URMC communications director Chip Partner.

As hospitals across New York prepared for a surge of COVID-19 patients, the state health department required them to cancel or postpone all non-essential procedures -- a move that URMC said cost millions of dollars in lost revenue each month.

As a result, the medical center -- one of the Rochester region’s largest employers -- initially estimated its budget shortfall at $500 million.

Now, the state has allowed some hospitals to resume some elective procedures. That, along with some assistance from the federal government’s CARES Act, reduced URMC’s estimated budget gap to $315 million, the medical center said.

Administrators at the medical center “anticipate and hope” that the vast majority of people furloughed will return to their usual schedules as URMC regains its financial footing, Partner said, but it could be months before that happens.

“What we hope is that furloughs are pretty much a thing of the past by August,” said Partner.

URMC joins hundreds of other hospitals across the country that have reduced staff because of lost revenue during the COVID-19 pandemic. Of the 20.5 million jobs the American economy shed in April, 1.4 million of them were health care workers.

The staff reductions will span all of the medical center’s divisions. At the Eastman Institute for Oral Health, almost 90% of employees will be furloughed, URMC said. Across the entire medical center, about one-fifth of employees will have their work schedules eliminated or reduced.

URMC said it’s planning for furloughs to last through July, but employees could be called back to work at any time.

Some of the medical center’s highest-paid employees were taking voluntary, temporary pay cuts to help reduce costs, URMC said in its statement.

The statement did not say how many staff were voluntarily reducing their pay or how much money those cuts would save, and Partner said he did not have those figures available.

URMC set up a website for employees to find information about furloughs and pay reductions. The medical center said it was making counseling and emotional support services available to employees and would help staff file unemployment claims.

Beth Adams contributed additional reporting.